Bottled water is a global commodity and is a profitable business if well – managed. Water is like the air we breathe in. Since the outbreak of the COVID-19 virus, bottled water demand has increased sharply. Consumers spent the year working and studying from home to try and limit its spread.
The U.S. market is the largest bottled water consumer market. Americans drank over 14 billion gallons of bottled water in 2019, according to IBWA, 2020. In 2018, the industry generated a total amount of 18.36 billion dollars. According to Statista (2020), the market should grow by 8.0% from 2021 to 2025. Furthermore, the Bottled Water segment will show a revenue growth of 12.4% by 2022.
More individuals and companies have shown interest in this profitable business venture. This is due to the If you intend venturing into the bottled water business. I’ve discussed in detail all it entails to produce bottled water.
Running a Bottled Water Production Plant
In simple terms, the production of bottled water involves two major processes. The Purification and packaging of water for consumption. The basic process of producing bottled water is usually the same for all plants. But there are different type of products and applications. All you need to do is to adapt your equipment to fit your specific requirements. I have explained the steps involved in the production of bottled water below.
The source of water plays a key role in bottled water production. Both the quantity and quality of water one wants to produce, as well as profitability. You must ensure that you have an excellent water source on quality and quantity. I recommend a local well or municipal water supply. You must carry out all the required tests to aid decision-making. You must also ensure that you carry out routine checks on the water source to track anomalies.
Water is a very delicate product, and contamination is a possible occurrence. Chemical pollution, as well as microbiological contaminants, affect water quality. The process of production is quite simple. Yet, you must take necessary precautions to avoid pollutants.
You will face some challenges as a producer. Some of them are due to Pathogenic organisms and protozoa contamination. These pollutants could taint water quality. They also reduce the shelf life of bottled water. These pollutants could also be a pathogenic threat to customers. Strict production control is critical. This is to avoid contamination from pathogenic bacteria or protozoa.
Quality control is a vital part of bottled water production. Producers must ensure that they produce only water of recommended quality. The water treatment section of the plant is very essential, and you must treat it as such. There are different processes involved in water treatment, including Activated Carbon Filtration. This is the removal of Chlorine and Trihalomethanes through a daily-monitored filtration process. Demineralization is then done to remove unwanted minerals in the water, a process called Reverse Osmosis. Water is then transferred to the Storage tank for further processing. You must ensure that the air in the tank is void of microorganisms. This helps to ensure that the water stored is not polluted. You then add minerals to the water according to consumers’ taste. The final process of treatment is micro-filtration and ultra-violet filtration.
Packaging involves filling treated waters into plastic or bottles. You must maintain the quality of your water. You must ensure that your packaging materials are not contaminated. The water used to wash and rinse these bottles must be clean before filling. Your filling room must be hygienic to ensure bottling in a controlled environment. You can carry out quality assurance of product via human inspection.
Cost of Operating a Bottled Water Plant
Starting a bottled water production plant is a capital-intensive process. The bulk of the expenses is on getting a facility to locate your plant. The cost of acquiring the various machines required is also capital-intensive.
The operating cost is lower than the start-up capital. These are the expenses incurred daily in the operation of a business.
Labor is a significant operating cost in any business. A bottled water production plant employs an average of 24 employees. These workers include Plant operator, machine operator, Watchman, Mechanic, Electrician, Quality Technician, etc.
The average wage in bottled water production is $17.33 per hour (Payscale, 2020). See https://www.payscale.com/research/US/Industry=Bottled_Water_Manufacturing/Hourly_Rate for full details.
For a 16-hour production cycle per day, $277.28. You can have your working period for 6 days. So, the total wage demand per week will be $1,363.68. The monthly wage demand will range from $5,454.72 to $6,818.4 for a 5-week month
The manufacturing sector of the United States of America is energy-consuming. The sector used 32% of the total energy consumption in 2019. In 2019, the average power cost for industrial consumers was $0.0683 per kilowatt-hour of electricity. (Sönnichsen, 2020). Manufacturing facilities use and average of 95.1 kilowatt-hours (kWh) of electricity per day. For a production day, the total cost of electricity is $6.495. For a production day, the total cost of electricity is $ 6.495. The total monthly electricity cost will be $ 155.88 for a 6-working day bottling plant.
You can make efforts to cut your electricity cost. To reduce cost, always switch off electrical appliances that are not in use. You must instruct your workers to switch off lights after the close of work.
Rent for Facility
You will spend a bulk of the start-up capital on acquiring a facility. Most plant owners rent this facility or get them through leasing. The average rent paid for warehouses for manufacturing in 2019 was $ 6.36 per square foot of the warehouse. For a 5000 sq. ft. warehouse, the average cost of rent is $31,800 monthly.
Packaging goes a long way in a bottled water production business. Apart from water quality, the packaging is also capital-intensive. After the machinery’s initial investment, the Cost Per Unit could range from $ 0.15 to $ 0.65.
You must choose a bottle design that meets your business goals. You must also consider the raw materials which account for 70% of the bottle cost. Other factors are the power required and the amount of high-pressure air you need to blow the container. See https://inter-techltd.com/how-much-does-it-cost-to-produce-plastic-bottles/ to learn how to cut bottle production costs.
Effective maintenance and operation will ensure the sustainability of the business. You must ensure that you carry our routine maintenance activity on your plant. I’ll recommend a quarterly check to ensure the longevity of the different machines.
The average maintenance cost of a plant is between 2-3% of the total value of the machines in the plant. Under poor operations, maintenance costs over 5% of the asset replacement value yearly.
Please click below to watch the production process of bottled water production.