...Bottled Water Case #1. Some key economic characteristics of the bottled water industry include its attractiveness to the market. The expected growth rate continues to rise and that makes it an opportunity for those willing to break into the market. The population is a key economic factor because they are becoming more conscientious of drinking water that had been provided by the municipalities, there are also concerns for the amount of sugar in soft drinks, so these are some of the reasons they are turning towards the bottled water industry. Bottled water is a more convenient way to a healthy drink readily available and its popularity continues to grow around the globe. This industry has an economic growth rate predicted at annual rates of 20% or more, and this makes the industry profitability rates continue to grow in the billions. The bottled water industry is highly competitive and most of the top contenders are soft drink companies that got into the market when they started seeing a consumer changeover to bottled water. The gain shelf space at the grocery markets, the sellers of bottled water have to compete aggressively to offer the lowest prices to distributers. Supermarkets and discount outlets were able to force the industry to pay slotting fees while also forcing them to lower their prices. Some retailers were even willing to offer rebates for shelf space in convenience stores. #2 a. Suppliers—plastic bottle producers, water treatment facilities, spring...
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...The Bottled Water Industry and Its Impacts on Our Environment and Health Comparing with Tap Water in North America INTRODUCTION The world nowadays has a rapid increase in population, thus it leads to a drastic demand for water resources. However, in reality, there is only 2.5% of the Earth’s water is freshwater, and 98.8% of them is still in ice and groundwater (Peter H. Gleic, 1993). The water resources are distributed unevenly due to the geographic locations. There are about 884 million people do not have access to clean and safe water. (World Health Organization, 2012). At the meantime, studies shows that limited availability of safe drinking water, and growing awareness among people to safeguard their health using bottled water, the bottled water industries boomed over those developed countries (Anisur Rahman, 2007). From 2001 to 2011, the United States alone had produced 5,185.3 millions of gallons of water to 9,107.3 millions of gallons of water, and had an increasing revenues from 6,808.4 millions of dollars to 11,083.8 millions of dollars (Beverage Marketing Corporation, 2006). As the bottled water market grows mature, it accounts for 1% of total GDP of the United States and Canada respectively in 2011. This paper is aimed at critically examining the overall bottled water production and its side effects on human health and environment in North America. It is organized as follows: it discusses where the water from and how it was processed and its affects on health...
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...Mark Hancock Environmental Economics Bottled Water Environmental and Economical Effects Introduction Since the early 1990’s American’s have been consuming large amounts of bottled water. Most American’s don’t realize the effects of the bottled water industry on the environment or on their wallet. Individuals believe that bottled water is more pure and of a higher quality than that of their conventional tap water. In reality this is false. We as a country are wasting money on bottled water and harming the environment in the process. Without a change of consumption habits our environment will see some dramatic changes. This is an important environmental and economical issue that will effect future generations as well as the current. Brief History Bottled water has become a part of many Americans life. Perrier started this trend with their introduction of bottled water in the early 1980’s. Ever since the early 1990’s when Coke and Pepsi got into the bottle water market because they saw their market share for soda declining Americans have been consuming bottled water at an alarming rate. These companies tried to glamorize their product saying it will make you skinny and healthy and associating it with big name celebrities and athletes. They stated that they were not in competition tap water because they provided a product that was portable, convenient and pure. In 2007 it was an 11.35 billion dollar business. The American people certainly bought into this...
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...The Bottled Water Industry Threat of entry of new competitors is low. Firstly, the competitors that currently exist are large, dominating companies who already own a huge market share of the industry. New entrants attempting to enter the market will have compete with established brands such as Coca-Cola, PepsiCo, and Nestle. These brands have decades of experience in the food & beverage industry, have developed brand recognition & loyalty and have achieved low-cost production and distribution capabilities that cannot be easily matched. Secondly, it is expensive to initially develop the infrastructure to produce the product. The case states that prices for bottle-filling lines range from $125,000 to over $100 million, not to mention the costs associated with “source certification, road grading, and installation of pumping equipment …” which require approximately $300,000 worth of investment. Threat of substitute products/services is high. Numerous bottled and non-bottled products that can easily substitute bottled water. The main factor that differentiates bottled water from other soft drinks is that it caters to a health-conscious market because it has no sugar and no calories. However, today, there are several healthy soft drinks that are ‘zero-sugar added’, ‘zero-calorie’ alternatives to water. Coke zero, crystal light powders, diet sodas, zero-calorie energy drinks, etc. are just some examples. Tap water is also a substitute product because many people simply trust the...
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...Case Study: Bottled Water Industry Team 3 James Barlow, Julianne Schneider, Robyn Sumner & Katie Austin GBA 490 Dr. Drnevich 26 March 2008 EXECUTIVE SUMMARY The strengths of The Coca-Cola Company’s Dasani brand include its availability and convenience, prominence of the parent company, geographic coverage, financial stability, assets, distribution channels, and image of social responsibility. Dasani’s availability and convenience stems from the fact that the brand is virtually in every supermarket, convenience store and vending machine. Consumers are bombarded with the brand, which makes it very recognizable and well known. Its recognition factor is partly due to the great success of its parent company, since The Coca-Cola Company is so well established and respected in the beverage industry. Another strength is Dasani’s geographic coverage. It is available in 200+ countries in localized flavors, which further extends the brands marketability. Dasani is obviously financially stable, as it is backed by one of the most successful beverage companies in the industry. Its financial stability allows for high cost advertising, marketing, and development. As part of the Coca-Cola family, Dasani reaps the benefits of readily available assets and distribution channels. Assets include water sources, processing systems, and bottling and manufacturing suppliers. Assets like bottling and manufacturing equipment can...
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...Review on Myanmar Bottled Water Industry with Porter’s Five Forces Review on Myanmar Bottled Water Industry with Porter’s Five Forces Introduction Bottled drinking water used to be a prestige product till 1990s in Myanmar. Then, the use of bottled water has grown considerably since factories were first set up in the mid-1990s. According to Myanmar Food and Drug Administration (FDA), there are 657 bottled water factories in 2013 which were rose form 320 factories in 2008. Bottled water culture has penetrated even into rural areas of Myanmar where majority of people previously held the view that bottled water was a waste of money. It is due to increasing urbanization, limited time to boil tap water, increasing suppliers and better delivery, convenience and portability. Myanmar bottled drinking water industry is currently dominated by Alpine which has 65% market share, according to the company reports. Analysis with Porter’s Five Forces An industry's competitive dynamics and profitability can be deducted by analyzing with Porter's Five Forces. (1). Rivalry among existing competitors Even though, Alpine has dominated the market, competition among second-tier brands such as Oasis, PMG, KTM , ICE, Sampar Oo, Max'2'0, Imperial Jade, KA is high. As bottled water has become a commodity-like product, customer switching...
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...There are mainly two styles of bottled water: sparkling, and still water. But there are many variations of these waters, which undergo different processes and encompass different characteristics. Sparkling or carbonated water, is usually consumed as a refreshment beverage, whilst still or non-sparkling waters are consumed as drinking water. WHO IS DRINKING BOTTLED WATER? Consumer research suggests that bottled water is consumed by people of varying age groups and occupations. The large majority however tend to be young singles and couples, in particular females aged between 14-35 years. Generally bottled water consumers can be described as being more health conscious, contemporary and socially aware. SO WHY DO PEOPLE DRINK BOTTLED WATER? YOU NEED IT Regardless of the seasons and the weather, your need for water remains the same. Remember that 95% of human blood is water. HEALTHY CONCIOUS LIVING In these health conscious days water makes a great contribution to overall hydration.It is fat and kilojoule free and a great thirst quencher, which makes it a great choice for the health conscious consumer. Many people wish to get back to basics and drink something that is refreshing and pure. Some people also wish to avoid certain chemicals used in the treatment of public water supplies, such as chlorine and fluoride, and are therefore turning to the chemical free alternative. CONVENIENCE With the development of more widespread leisure and activities and the expansion of...
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...The Bottled Water Industry Threat of entry of new competitors is low. Firstly, the competitors that currently exist are large, dominating companies who already own a huge market share of the industry. New entrants attempting to enter the market will have compete with established brands such as Coca-Cola, PepsiCo, and Nestle. These brands have decades of experience in the food & beverage industry, have developed brand recognition & loyalty and have achieved low-cost production and distribution capabilities that cannot be easily matched. Secondly, it is expensive to initially develop the infrastructure to produce the product. The case states that prices for bottle-filling lines range from $125,000 to over $100 million, not to mention the costs associated with “source certification, road grading, and installation of pumping equipment …” which require approximately $300,000 worth of investment. Threat of substitute products/services is high. Numerous bottled and non-bottled products that can easily substitute bottled water. The main factor that differentiates bottled water from other soft drinks is that it caters to a health-conscious market because it has no sugar and no calories. However, today, there are several healthy soft drinks that are ‘zero-sugar added’, ‘zero-calorie’ alternatives to water. Coke zero, crystal light powders, diet sodas, zero-calorie energy drinks, etc. are just some examples. Tap water is also a substitute product because many people simply trust...
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...Topic: The Bottled Water Industry Specific Purpose Statement: To convince Americans to stop buying bottled water and start drinking from our taps; the bottled water industry his hoaxing us into believing that bottled water is healthier for us and better for our environment. Central Idea: To stop Americans from buying bottled water and to have them start drinking from their taps, because the bottled water industry a hoaxing us into believing that bottled water is healthier for us and better for our environment. _____________________________________________________________________________________ Introduction: “Whiskey is for sippen and water is for fighten” This quote from author Mark Twain, is exactly my mission today. I have done the research and am one of the few people who know and understand the truth behind the bottled water industry. I am here to explain to you why we must fight for the world’s most valued resource, stop purchasing bottled water, and to start drinking from our taps. (Connective: Before I begin to tell you why and how to solve the problem I first would like to expose to you all, the problems hidden within the bottled water industry.) Body: I. Bottled water industries are eliminating the access to clean drinking water. A. Nestle is the world’s largest food processing company. 1. Nestles owns 6 water companies: Poland Spring, Deer Park, Zephyrhills, Ice Mountain, Ozarka, and Arrowhead. ...
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...is partly due to the great success of its parent company, since The Coca-Cola Company is so well established and respected in the beverage industry. Another strength is Dasani’s geographic coverage. It is available in 200+ countries in localized flavors, which further extends the brands marketability. Dasani is obviously financially stable, as it is backed by one of the most successful beverage companies in the industry. Its financial stability allows for high cost advertising, marketing, and development. As part of the Coca-Cola family, Dasani reaps the benefits of readily available assets and distribution channels. Assets include water sources, processing systems, and bottling and manufacturing suppliers. Assets like bottling and manufacturing equipment can be used interchangeably among several types of beverage productions, which saves Dasani from having the purchase brand new equipment or separate bottle and manufacturing suppliers. Its largest distribution channel is supermarkets, which also sell several different types of beverages in The Coca-Cola Company family. Transporting a full load of company owned brands, including, Dasani, is cheaper than transporting each individually. Among Dasani’s weakness are its incurable environmentally unfriendly practices. Though Dasani strives to be socially responsible, the industry will never rid...
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...The Water Bottle Industry Markets Water is something that anyone around the world could get from the tap for free, but now it is all the rage for the beverage industry. Bottled water has become the industry's fastest growing segment, both in volume and profits. Due to the consumer's needs and wants for a healthier lifestyle, the beverage industry provides a necessary product to the consumers, which is bottled water. Water is essential and with the demand to participate in a healthy lifestyle, the water industry will be successfully profitable. The market size for this industry has been growing and will continue to grow in a rapid pace. Over the past ten years, bottled water has moved from being the preserve of a relatively small market into the U.S. mainstream, with sales of about $7.5 billion, and that's only for water in bottles of 1.5 liters or less (Durr). According to the International Bottle Water Association, Americans spend $5.6 billion in 2000 on bottled water. By 2005, Americans will consume 7.2 billion gallons of bottled water, up from about 5 billion gallons in 2000, the association reported. A factor that will continue to drive the bottled water market is foremost the desire to live a healthy lifestyle. Which leads to the concerns of contaminants found in the tap water. People will pay high prices for water, just to be ensured that it is safe to drink the water that they purchased. Drinking lots of water also prevents dehydration. According to the Bottled...
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...Bottled Water Beware Water is the top third industry in the world today – a powerful commodity for business, “the Blue Gold of the Future!” But actually water is a top requirement for human survival and with our increasing environmental issues destroying our water reserves, many people on the planet are having a hard time surviving as their ability to access water is becoming difficult and expensive, and the quality of clean water is becoming unhealthy with industrial pollution especially in poor countries. The bottled water industry is worth $170 billion in the world today. It seems the whole water bottle industry was a marketing dream sold to the people as a necessity to ward off the problems of tap water – labeling tap water the inferior competition. “Scaring us, seducing us and misleading us – these strategies are the core parts of manufacturing demand.” Scaring us by telling us tap water is dirty, seducing us with images of pure water running off mountains on water labels and misleading us with their attacks on tap water. When in fact, most bottled water comes from the tap and treated with chemicals for taste and odor effects. In Canada, there are two categories of bottled water: 1) spring/ mineral water and 2) water other than spring or mineral water. Bottled water is regulated by the Food and Drugs Act & Regulations (FDAR) because it is considered a food. Health Canada also regulates bottled water by controlling the packaging, labeling, advertising and other safety...
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...Specialty Industries Specialty Industries spotlight ○ Bottled Water Industry January 2001 RAPID GROWTH AND CONSOLIDATION The bottled water industry has seen significant mergers and acquisition activity in the last four years. While industry revenues grew by more than 13% last year, consolidation of small and midsize bottled water companies continues to increase the margin pressures now felt by regional firms. The premium valuations currently being paid for bottled water companies present owners with a viable alternative to future earnings pressure from the industry’s larger players. Furthermore, access to a strategic partner’s capital and mature marketing and distribution channels is a way for bottlers and distributors to capitalize on their strong regional presence and take their company to the next level. Mirus’ research of recent disclosed M&A transactions shows that bottled water companies are valued at an average of 11x EBITDA with a corresponding price-to-sales ratio between 1.2x and 2.9x sales. It is important to note that firms with healthy EBITDA margins drove the most value from a price-to-sales standpoint. ○ ○ ○ ○ ○ ○ ○ ○ ○ INDUSTRY TRENDS The dynamic growth of the U.S. bottled water industry has been driven by a number of trends including favorable demographics and a societal increase in health consciousness. The matured tastes of older generations are seeking more natural, less caloric beverages. Additionally,...
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...Bottled Water report Autor: Marlon- Pavel End ID:12074541 Written on the 14 – 15. 2. 2013 Contents page 1. Introduction and Background Information Page 1 2. Demand & Supply Factors a. The economic crises Page 1 b. Weather- Global warming Page 2 c. Advertisement Page 3 d. The environment Page 4 3. Elasticity or inelasticity of demand and supply related to the factors above Page 5 4. competitive and pricing strategies e. water drunk at home Page 7 f. water drunk outside Page 7 5. Conclusion Page 7 6. References Page 9 Introduction and Background information This report was requested by my summer internship company and contains information about the current market situation of bottled water drunk in the home and bottled water drunk outside the home. The report will focus in these two markets, on supply and demand factors, concepts of elasticity of demand and of supply related to the factors and competitive and pricing strategies. The information given in the report are researched in databases, books, websites, internet articles and YouTube clips. Supply and demand factors in the markets. The economic crises The economic crises, started in 2008 caused a decrease in the PDI (Personal Disposable Income) which led to a decrease in general household spending (Kirkup, 2011) The bottled water market was affected by the economic...
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...Australian Beverages Ltd-Pre-seen case study information A Introduction to Australian Beverages Ltd In 1937, Australian Beverages Ltd (ABL) commenced manufacturing soft drinks [non-alcoholic drinks rather than 'hard' drinks that contain alcohol]. During the 1970s and 1980s, the company expanded its beverage portfolio by entering into other non-alcoholic beverage categories, such as fruit- and milk- based drinks. In 2011, the company was Australia's largest supplier of non-alcoholic beverages. Tom Dwyer, the current Managing Director, has been with the company since 2008. He joined the company at a time when carbonated soft drinks (CSDs) growth was stagnating and shareholder confidence in the company was waning. Dwyer established a strategic planning team within the company to assess the current product portfolio and identify organic and acquisition growth opportunities. From this review the importance of operational excellence was identified and strong investment was made in world-class manufacturing facilities and systems. Process re-engineering was implemented to reduce the costs of manufacturing and time-to-market. Given the declining consumption of CSDs, Managing Director Tom Dwyer has sought to reduce ABL's reliance on them, focusing on growing new products and entering new non-alcoholic beverage categories since his appointment in 2008. Alongside significant investment in product development of other non-alcoholic beverages, several acquisitions have been made to...
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