Start-up Funding | |
Start-up Expenses to Fund | $22,350 |
Start-up Assets to Fund | $444,223 |
Total Funding Required | $466,573 |
Assets | |
Non-cash Assets from Start-up | $320,000 |
Cash Requirements from Start-up | $124,223 |
Additional Cash Raised | $0 |
Cash Balance on Starting Date | $124,223 |
Total Assets | $444,223 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $21,354 |
Long-term Liabilities | $180,000 |
Accounts Payable (Outstanding Bills) | $61,409 |
Other Current Liabilities (interest-free) | $16,810 |
Total Liabilities | $279,573 |
Capital | |
Planned Investment | |
Jim Hunt | $56,000 |
Mike Pacek | $36,000 |
New Investors | $75,000 |
Other | $20,000 |
Additional Investment Requirement | $0 |
Total Planned Investment | $187,000 |
Loss at Start-up (Start-up Expenses) | ($22,350) |
Total Capital | $164,650 |
Total Capital and Liabilities | $444,223 |
Total Funding | $466,573 |
The facilities are located in a rented building on an industrial estate in Newark, California.
A description of the technology involved in the production can be found in section 3.5 (Technology). The following is a description of the production layout.
The company is in the water purification business. H20 Industries is engaged in a specific branch of this business called “Service deionization.” Within this branch, the company plans to emphasize a further service specialization known as “segregated regeneration,” as opposed to “bulk regeneration.” This concept is explained in the following sections.
The service products offered by H20 Industries are segregated as well as bulk regeneration of portable H20 Industries exchange tanks. The service is offered in three tank sizes of 3.6, 2.5, and 1.4 cubic feet (cu ft). In these sizes, the company will offer:
The application of portable deionized water is broad. Practically all industries using water in processing are potential accounts. Size of company is rarely a determining factor. There are applications in electronics and high pressure boilers where flow rates of several hundred gallons per minute are provided by portable exchange systems. The main unique benefits are:
Providing the service to a customer is simple, usually requiring only minimal equipment. H20 Industries is available from a large competitor, US Filter and a few small competitors, such as Fluid Solutions of Lowell, MA. However, none of the competition can provide segregated regeneration (See Competitive Analysis below).
In the Northern California area, outside of a small company in Lowell which has to farm out its regeneration business to a “DI” company in Nevada, Simply Clean in Oregon, and a couple of independent Culligan agents, there is only the very large, fully-integrated US Filter (owner of Culligan) to compete with. This company, by virtue of its size and involvement in all fields of water treatment, is not suited to satisfying small users of DI, nor are they able to respond to niche needs. For example, US Filter cannot handle segregated resin. All resin treated by US Filter is regenerated on a bulk basis, which means that various customers’ depleted resin tanks are combined. This is not a problem for many users of DI, but the dialysis department of a hospital might well object to their resin being co-mingled with resin used in the metal plating industry. H20 Industries plans to specialize in portable segregated resin service. US Filter can try to service customers with a desire for segregated DI by promising to always supply tanks with new resin, however, there are technical problems with this.
US Filter’s prices for cation and anion regeneration are $31.25/cu ft and mixed bed $43.05/cu ft. H20 Industries’s prices for the same bulk regeneration are $32 and $43, respectively. The primary market thrust of H20 Industries’s sales will be the segregated regeneration which US Filter does not offer. This product sells at a premium ($57/cu ft and $63/cu ft, respectively). Some small players in the market offer regenerated resin (not segregated) in a price range of $63 to $80 per cu ft (mixed bed).
Sales literature will be written and printed. A provision for this has been made in the projected sales and marketing expenses.
The service provided by H20 Industries is the regeneration of ion exchange portable tanks. The tanks themselves are supplied to customers on either a monthly rental basis or offered for sale. These tanks, and any other hardware, are readily available from a number of suppliers. By virtue of the owners’ long involvement in the industry, they are fully knowledgeable of existing sources for all hardware, including resin, as well as the supply of the two major chemicals used in the process of regeneration. The only other variable cost of production is the salt used in the brine bath, this is also readily available from a number of suppliers.
Ion exchange is a major means of purifying water for industrial purposes. The degree of purity depends on the source of the water and it’s use. Companies, ranging from car washes to the pharmaceutical and semiconductor industries all need various amounts and degrees of purified water. Ion exchange is a chemical process by which ions, or ionic substances that are considered “undesirable” in water, are reduced or removed from water by use of ion exchangers or resins. Most ground water contains unwanted dissolved substances, such as calcium and magnesium, whose molecular structure contain charged ion particles.
The most common impurities with ions of a positive charge are: sodium, calcium, magnesium, potassium, iron, and manganese. These are called cations. The unwanted dissolved substances having negative ion charges, known as anions, are: bicarbonate, chloride, carbonate, sulfate, nitrate, and bisilicate. When a substance separates into ions, each ion is now able to combine with another ion with opposite charge, even if that ion is from a totally different type of molecule. Substances only separate into ions when immersed in water molecules. For example, a molecule of hydrochloric acid is made up of a hydrogen atom and a chloride atom. Hydrochloric acid (HCL), when immersed in water, will split apart into one positively charged hydrogen cation (H+) and one negatively charged chloride anion (CL-). If sodium hydroxide (NaOH) were added to this solution, the NaOH would split into Na+ and OH-, which would combine with the opposite charges of the hydrochloric acid ions to form sodium chloride, better known as “table salt” (Na+CL-) and leftover hydrogen and hydroxide atoms (H+OH-). The field of deionization, known as DI for short, utilizes this natural phenomenon by designing a cation exchange resin which will substitute hydrogen atoms (H+) for virtually all of the other cations, and designing an anion exchange resin which will substitute hydroxyl ions (OH-) for virtually all of the other anions. By means of this process we end up with only H+ and OH- which is equivalent to H2O (water). By forming this demineralized water, we create water which is no longer a conductor. We can measure the purity using an ohm meter. Ohms measure resistance. The higher the ohm count, the lower the conductivity. H20 Industries is routinely formed to 18 mega ohms per centimeter, which is very close to zero conductivity (18.23 at 25 degrees Centigrade). Without giving lengthy chemical explanations, what happens in the process is as follows:
The regeneration process can take place at the location where the water is being purified, however, most users of H20 Industries do not install the expensive equipment to do this but simply arrange for a service provider, such as H20 Industries, to replace the tanks and perform the regeneration process off-site.
As high-tech industries, such as electronics, communications, and pharmaceuticals, continue to grow, there will almost certainly be increasing use of deionization technology and deionized water. As instrumentation and analysis procedures improve, controlling and monitoring the deionization process will be easier and more efficient, and this will, undoubtedly, help create new uses for deionization that have not yet appeared, as well as make H20 Industries more affordable to sectors now using other methods of purification. As more people in the water treatment industry become familiar with the DI process, the industry for H20 Industries and equipment will benefit.
In addition to bulk and segregated portable H20 Industries, the company plans to expand sales of filters and DI cartridges. These sales have been disregarded in this business plan, but they could become more significant in the future. These products lend themselves to mail order type sales, as they are small and lightweight. Cartridges are disposable items. H20 Industries also has plans to develop a reusable shipping container for its smallest (8″ x 18″) DI exchange tank so that this can also be shipped via UPS. This product will be marketed on a website, as well as through conventional direct mail and yellow page advertising.
In the future, a logical off-shoot of the DI business is reverse osmosis (R/O) used in conjunction with DI exchange tanks. The inclusion of R/O in front of the DI tanks will extend the capacity of an exchange tank by 1000%. This addition to the product line could become a substantial element of total company sales.
Reverse osmosis and electric reversing deionization are beginning to compete with exchange tank DI technology. H20 Industries plans to offer service contracts to maintain this equipment at the customer’s location. This equipment may to either sold or leased.
The total market in Northern California for H20 Industries is between 670,000 and 925,000 cu ft of resin annually. H20 Industries’s total productive capacity will be only 36,400 cubic feet, or 3.9-5.4%. Since H20 Industries will have the unique capability of performing segregated regeneration, which is of special interest to the medical industry (dialysis, labs and pharmaceutical), the company will emphasize sales efforts in this segment for high purity H20 Industries. This segment is estimated at 167,000 cu ft annually. Next in terms of marketing emphasis will be the electronic (223,000 cu ft) and machine tool industries.
The market for H20 Industries encompasses many industries, and within them there is a wide range of purity needs. At the low end, a car wash might use H20 Industries in the final rinse only. Their need for purity might be only .5 Megohms (Ohms measure resistance). Water is only a good conductor because of the quantity of dissolved solids in the water. As the ion exchange process lowers the level of total dissolved solids (TDS) the resistance, measured in ohms, increases.
A purity level of .5 Megohms is pure enough for a car wash final rinse cycle, but not even close to pure enough for a electronics wafer manufacturer. They would need 18 Megohms, at which point the water would be pure and incapable of acting as a conductor. Generally speaking, those sectors of the market that need the highest levels of purity are the customers for H20 Industries’s main niche product of segregated DI exchange service. This means that the resin coming back from the customer is never mixed with any other company’s resin. This is a very strong sales feature when dealing with dialysis units of a hospital, labs and pharmaceutical manufacturers, and electronics makers. These customers are happy to pay a premium over the price charged for bulk DI regeneration service because they do not want their resin co-mingled with resin coming from a metal plater or a car wash.
Quantifying the market for segregated portable H20 Industries is not easy. Unlike the market for used cars, metal furniture, or nearly every product one can think of, there are no readily-available statistics on the market for portable DI exchange. There is overwhelming agreement that US Filter has the commanding market share of DI exchange business, opinions range from 85 to 95% majority.
According to the publisher of ULTRAPURE WATER®, (May-June 1999 volume 16, number 5) US Filter had sales of $1 billion in 1990, and has grown to $5 billion in 1999. Portable DI exchange is only a small portion of their business. Sales in Northern California of only DI portable exchange is estimated at $25 million. This has been confirmed from several sources. Firstly, one of the owners of H20 Industries is a former employee of US Filter. In 1996, their DI exchange business reached $12 million. This was only 65% of the market. Then the company acquired Culligan, adding another $8 million in portable DI exchange business in Northern California, and bringing the total to $20 million. It is assumed that sales have grown to $25 million over the past several years.
The relationship between input water and DI exchange capacity is charted. Assuming in-coming water quality of 200 parts per million of TDS in the far left column, a 3.6 cu. ft tank of regenerated resin can handle 10,800 gallons. This means that an average user with a flow rate of 10 gallons per minute would use up a 3.6 cu ft tank in 2.57 days, or 1.4 cu ft per day. Assuming the salesman was accurate in his statement of 2,000 customers, this would work out to 840,000 cu ft of regenerated portable DI exchange business per year. This figure is somewhat greater than the figure of 610,000, however, the subject of this business plan, H20 Industries, will have a productive capacity of only 140 cu ft per day, which represents between 4.5% and 6.3% of the total market in Northern California.
Taking the midpoint estimate for the total Northern California market of 780,000 cu ft annually, these high purity users would represent a market 558,000 cu ft
Hospital Dialysis Units and Stand alone Clinics:
California lists 16 stand-alone dialysis clinics, many of whom have multiple locations with varying numbers of stations. Every dialysis clinic, as least in Michigan according to BESCO, use H20 Industries for polishing, after initially running the water through a reverse osmosis system. Hospitals also have dialysis units. In addition, there is blood analysis work which is normally done using “wet” analysis equipment that requires H20 Industries. Assume this sector represents only 10% of the high purity market, or 55,000 cu ft annually.
Labs and pharmaceutical Manufacturers:
A list of labs and pharmaceutical makers in Northern California contains 330 names. A sample calling indicated that some use no pure water, others use such small qualities (10 gals/months) that they buy the water from suppliers like Hubbard-Hall, already made up. Others use so much H20 Industries that they have their own built-in DI system. The rest who have flow rate needs of between one and 20 gallons per minute are in the range most economically serviced by portable DI exchange. Assume this to represent 20% of the 558,000, or 112,000 cu ft.
Electronic Manufacturers:
Semiconductor manufacturers and other makers of electronic components need pure water to flush with. As microprocessors use wafers of ever-decreasing size, the requirements for pure water to rinse with increase, as do various other additional micro filtering. A list of electronics manufacturers in Northern California names 189 makers. Assume this sector represents 40% of 558,000, or 223,000 cu ft.
Machine Tools and Parts:
This is one of the fasting growing sectors as more and more manufacturers conform to the ISO 9000 standard, which requires delivered parts to be clean (defined as rinsed thoroughly with water of one Megohm purity or better). This category includes a need for H20 Industries in machines consuming cutting oil, any machine with cooling systems, and other uses. Assume this sector represents 30% of 558,000, or 167,000 cu ft.
This sector of the market will represent the market for DI exchange water lower than one Megohm in purity. Assume that the following industries take up the remaining 30% of the total market. Some industries that would be included in this “other” category would be:
The chart and table below summarize the total market potential for the DI exchange services in Northern California.
Market Analysis | |||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |||
Potential Customers | Growth | CAGR | |||||
Dialysis Units | 2% | 55,000 | 56,100 | 57,222 | 58,366 | 59,533 | 2.00% |
Labs and Pharmaceuticals | 5% | 112,000 | 117,600 | 123,480 | 129,654 | 136,137 | 5.00% |
Electronics Manufacturers | 0% | 223,000 | 223,000 | 223,000 | 223,000 | 223,000 | 0.00% |
Machine Tool and Parts | 7% | 167,000 | 178,690 | 191,198 | 204,582 | 218,903 | 7.00% |
Other | 10% | 222,000 | 244,200 | 268,620 | 295,482 | 325,030 | 10.00% |
Total | 5.43% | 779,000 | 819,590 | 863,520 | 911,084 | 962,603 | 5.43% |
The target markets that will receive the most attention will be the sectors which require the highest levels of pure water. This means the 70% of the market that wants quality of one Megohm or better. Within this sector, quantified as 558,000 cu ft annually, H20 Industries will emphasize those users wanting the top echelon of purity (18 Megohms).This sector of the market might be only one third of the 558,000, but even at one third (186,000), it totals more than 300% of H20 Industries’s total capacity, including its bulk portion.
One notable trend in industries is to out-source. Chief financial officers analyze the costs of producing something in-house versus the costs of farming it out. Water purification is no exception. Although many large users of H20 Industries will want to set up their own in-house capacity, the capital costs, the maintenance costs, and the costs of dealing with regenerate waste often make DI portable exchange a more economical solution. Down-sizing within a company with its own pure water manufacturing capability often will lead to a management decision to shut down their in-house plant and switch over to portable service.
Another trend is for more and more industries to need higher degrees of purity in their manufacturing process, which results in an ever-growing market for H20 Industries.
The reasoning behind the attention to the highest purity sector of the market is that H20 Industries is able to provide segregated DI exchange service. A customer’s in-coming tanks for regeneration are tagged, and after regeneration, the same resin is returned to the customer. This specialized service is a major selling feature over US Filter, who must co-mingle customers’ resin in a bulk regenerating facility. Also, bulk regeneration will not achieve the same deionization capacity as H20 Industries’s segregated method which utilizes more chemicals and longer regeneration times. A customer dealing with blood can easily be sold on segregated resin as he would not feel comfortable that his resin would be co-mingled with resin used in a totally different industry.
In addition to the feature mentioned above, H20 Industries will concentrate on those customers who place a premium on response speed and intensity of service. Again, mainly the higher quality users of H20 Industries exchange, where a shut-down would be very expensive, will demand the highest degree of quality available. Segregated exchange service from a smaller supplier is much more likely to satisfy than a huge conglomerate like US Filter where portable exchange can only be done on a bulk batching basis and represents only a small part of their overall business.
The market growth percentages used in the market analysis table were obtained from various articles appearing in ULTRAPURE WATER®, the definitive journal of high-purity water. Specific articles can be located from an index on their website, www.talloaks.com/.
The industry for providing portable H20 Industries service is dominated by one very large company–US Filter. US Filter controls between 90 to 95% of the H20 Industries service business in Northern California. The company has grown from $1 billion to over $5 billion in the past six years, primarily through an acquisition binge. The company is now finalizing its sale to Vivendi’s Generale des Eaux water subsidiary which will result in combined sales of $12 billion, making it the largest water business in the world. Originally, US Filter’s primary focus was industrial and high purity water. Its acquisitions in other areas include drinking water, waste water, municipal water, and water supply.
Now, less than 20% of its activities relate to technologies and markets connected with high purity water. A much smaller percentage is connected with H20 Industries, and a still-smaller percentage concerned with DI exchange service. After their merger, the percentage will drop even further from 20% to eight percent. This situation has resulted in a growing dissatisfaction with US Filter’s services for H20 Industries exchange. Both owners of this project have been hearing complaints from US Filter customers for quite some time. This is not just a condition evident in Northern California, other sections of the country have noticed it and competitors to US Filter’s DI exchange business have started to grow.
Users of H20 Industries have had little choice in regards to their provider. It is regenerated on a bulk basis only, with no option for segregated regenerated resin (see section on Market Segmentation). Some small customers have obtained the DI exchange service through their local Culligan man or similar water serviceman who in turn obtains it from US Filter. The fact that some small players in the market can capture some of this DI exchange business from US Filter despite a higher price ($63-$80 per cu ft versus $40 per cu ft from US Filter) is a good indication of the importance that service plays in the buying decision. Rarely does the price of H20 Industries represent a significant variable production cost in a manufacturing process. Much more of a factor is worry about quality level and service response time.
In reaction to the service complaints of customers for US Filter’s DI exchange, a couple of small competitors have sprung up in Northern California. Fluid Solutions in Lowell is one such company. This company has been supplying customers with H20 Industries exchange although they have no regeneration facilities of their own. They merely service the customers and send the tanks to a regeneration facility of another DI exchange company in Pennsylvania.
The prices charged by all local companies to regenerate are between $63 and $80 per cu ft for mixed bed. They charge $20 to $30, depending on tank size, as a monthly rental charge.
The market in Northern California is ripe for growth in competitors to US Filter which does not provide segregated regeneration and whose regenerated resin, on a bulk batch basis, will not serve as high a flow rate as non-bulk regeneration.
Industry participants are varied, as there are several means of obtaining purified water. There are companies which design and engineer reverse osmosis equipment. This equipment has a sizable share of the water market at the end close to the municipal water inlet. Reverse osmosis (R/O), in conjunction with carbon filtering and ultraviolet light, is used (for example in dialysis) to bring the TDS down to a lower level. Ion exchange, either fixed or portable, is then used to polish away the remaining impurities. Other companies may supply e-cell equipment which deionizes electrically. This technology has not advanced sufficiently to compete with traditional H20 Industries but is still occasionally sold in conjunction with a R/O system as the e-cell can only handle small levels of TDS. Some industry participants are primarily engaged in water softening and water filtration for drinking and household purposes. These companies may also utilize green sand to remove iron and magnesium hardness derived from aging municipal piping systems.
In short, there is a full range of industry participants from the local Culligan service representative mainly involved in private households, to large companies involved in engineering, design, consulting, component manufacturing, waste water treatment, etc. With respect to the narrower market for H20 Industries, there are chemical companies who supply (by the gallon) H20 Industries to very small users. There are a few small companies engaged in DI exchange service who do this only as an adjunct to their main business, such as water softening, and who only act as a distributor of DI exchange regeneration facilities located outside of Northern California.
Besides direct sales effort to large users of H20 Industries, a major element of the company’s marketing efforts will be to develop a distributor network through existing local water service companies. These companies provide local water service to small companies and homes throughout Northern California. Most of their business takes the form of water filtering, water softening, reverse osmosis maintenance, swimming pool service, etc. The best of these will be recruited to add H20 Industries service to their product line.
H20 Industries will offer segregated resin regeneration to customers wanting the highest levels of water purity. Segregated regeneration is not offered by any other company in Northern California and indications are, based on present pre-start-up sales, that users of H20 Industries are willing to pay a substantial premium for it. It represents a form of peace of mind which dialysis units, laboratories, etc. feel is important.
The second most important value proposition is service response. When H20 Industries tanks need changing customers insist on, and will receive, an immediate response.
H20 Industries’s ability to segregate a customer’s resin and return it to him regenerated to the maximum limit, should put the company in a strong competitive position.
Approximately all of H20 Industries’s business will be directed at the portable service DI market. This market emphasis should quickly be noticed by users of H20 Industries, who at present rely on US Filter. US Filter’s product range growth through acquisition and buy-outs has de-emphasized the importance of its H20 Industries exchange service.
Hence, the two major aspects of the firm’s competitive advantage would be high quality segregated resin regeneration and fast service response. It will be important to stress these advantages in the sales literature.
H20 Industries’s marketing strategy will be to execute and communicate its value proposition of service and market segmentation advantage in providing segregated regeneration of customers’ resin.
Wherever H20 Industries cannot economically sell directly, due to distance or quantities, it will utilize a network of water service companies. These companies will be carefully chosen for their quality of service. An arrangement will be set up whereby the distributor will offer DI exchange service along with its other water services. The installations can easily be handled by them. They would tag the tanks and return and pick up from the H20 Industries plant. Being able to offer this service increases the image of the local water service company. It fosters a feeling a one-stop shopping. A 33% discount off the retail price should be adequate to satisfy the distributors.
H20 Industries’s ability to regenerate resin on a segregated basis, rather than only bulk, is a capability that should provide quick and easy entry into the user market where the highest water purity is needed. These users, blood analysis, hemodialysis units, and medical laboratories for example, are especially sensitive to contamination risks. Simply pointing out to these users that bulk regeneration involves the co-mingling of their resin with resin used in the metal-finishing and car wash industries usually is quite convincing. Segregated regeneration results in the further advantage of achieving a higher DI capacity per cubic foot as greater quantities of chemicals are used during a longer regeneration period.
The second most important position statement is H20 Industries’s concentration on the DI exchange business. This concentration will force H20 Industries to provide a higher level of service, and more quickly, too. It must be remembered that the cost for H20 Industries in the market for the highest level of water purity is not a significant cost element in the overall cost structure. However, a service shutdown, for quality or for service reasons, would be very costly to high technology users of H20 Industries.
In line with the conclusions drawn in the positioning statements, H20 Industries can charge a higher price for its segregated regenerated resin. There is virtually no competition for this product in the Northern California market.
Charging $63 per cubic foot (mixed bed), as used in the sales projections, is more than a 65% increase over the price for US Filter’s bulk resin price for mixed bed. H20 Industries is currently successfully charging in excess of $70 for this product. It is essential that H20 Industries place a premium price consistent with its superior product.
Wholesale prices have been established to encourage the quick formation of a dealership network. Dealers are afforded a 33% discount.
The main focus of promotion will be two-pronged: promotion to H20 Industries end users, and promotion to wholesalers.
Promotion to wholesalers should receive primary stress due to the extended reach made possible by the wholesaler network with its existing customer base. The sales force of these wholesale distributors needs to be educated on H20 Industries’s positioning statement so that they all understand the important sales advantages of segregated resin. Being able to offer DI exchange service to a distributor’s customer list is a great advantage to the distributor, and this fact needs to be clearly spelled out to them. Therefore, the H20 Industries relationship with a dealership network is one in which both sides benefit.
H20 Industries should strive to create a small-town, friendly relationship with its customers. Company brochures will show a map with all the H20 Industries locations, including each newly acquired distributor. The distributor trucks, as well as H20 Industries vehicles, would carry the H20 Industries logo, helping all to achieve name recognition. Cost savings would result through sharing literature, leads (by territory and/or industry), co-op marketing costs, and the sharing of technical expertise.
Direct marketing to customers within easy reach of H20 Industries should stress service. As a major supplier of resin stated: “US Filter is a huge concern that closes down at 5 P.M. on Friday.” Customers for H20 Industries need to feel that they can get service after hours, and even on a Saturday if need be. These customers feel much more comfortable dealing with an exchange service that is closer in size to the customer, and where the exchange service is an important portion of total sales revenue of the supplier. Prompt deliveries, trouble-free installations, good technical advise, etc. are main building blocks of the promotion strategy.
The sales strategy is to concentrate on that segment of the market most easily captured by the following sales feature: segregated regeneration of portable resin. In addition, the fastest way to reach the sales goal for the first several years is by actively working to develop a dealership network for H20 Industries.
Sales Projections:
Sales (July 1999) are running at less than 15% capacity monthly, exclusive of rental revenue. This approximates 285 cubic ft per month. The plant capacity will be 100 cu ft per day, on a one-shift basis. Based on the potential market outlined in the Marketing Section of this plan, growth in sales of regenerated segregated resin should reach 433 cu ft per month by October (equals 20 cu ft/day) which is this plan’s starting point, and growing steadily each month until 80 cu ft per day is reached (80% capacity) by the end of the first year. Total production of segregated resin is assumed to be split into equal quantities of anion, cation, and mixed bed.
Once the 80% capacity utilization level is reached (October 2000), unit sales will grow modestly in year two and year three. This growth can be achieved within the capacity limits of 100 cu ft daily (26,000 cu ft per annum) without increases in production labor. Further increases in segregated regeneration would require overtime labor charges. Also, for the projection purposes, direct unit costs for years two and three remain at the level of year one.
The bulk regeneration pad will have a capacity of 20 cu ft and can handle two batches during an eight-hour shift, totaling 40 cu ft/day. We will assume sales for bulk regeneration will grow at the rate of 5 cu ft/day in the first month reaching capacity of 40 cu ft/day after eight months. Sales are split between mixed bed (50%), 25% anion, and 25% cation. Sales of bulk resin will grow 15% each of the first three years. As the bulk regeneration, unlike the segregated regeneration, is not labor intensive, this 15% growth can be achieved without increases in production labor.
In projecting unit prices per ten cu ft. Prices will be assumed at:
The above prices will be reduced for dealers who will deliver and pick up at the factory to:
We will assume that 50% of all sales will go through dealers, so the unit price weighted average of the retail and dealer prices will be:
Variable Unit Costs:
The costs connected with one cubic foot of segregated anion treatment involve the cost of:
Cost of replacing small amounts of lost resin.
Experience indicates that with each regeneration it is necessary to replace approximately two percent of the resin. Anion resin costs $130 per cu ft. Cost is $2.60 per cu ft of anion serviced.
Summary of Anion servicing costs:
Total for anion servicing: $10.74
The costs connected with servicing one cubic foot of segregated cation treatment involve the cost of:
Experience indicates that in the process of regeneration about 2% of the resin needs to be replaced. Cation resin costs $30 per cu ft. Cost is $.60 per cu ft of cation serviced.
Summary of Cation servicing costs:
Total: $8.78 for cation servicing.
Costs of servicing one cubic foot of mixed bed:
A mixed bed tank is more time-consuming as it requires a separation stage prior to regeneration. City water (not DI) is mixed with salt. This solution is used to bathe the anion and cation resin in a cone until the two resins separate, at which point the cation and anion are treated in the regeneration stage in the same manner as the single bed anion and cation. One mixed bed contains twice as much anion as cation. This aspect results in a weighted cost of $10.09 per cu ft Salt consumption: every cubic foot of mixed bed needs 1.5 cu ft of brine solution. There are 7.48 gallons per cu ft This comes to 11 gallons of brine needs. A 22% salt solution in this quantity of water would amount to amount two pounds. Salt is supplied by Hubbard-Hall Inc. at $.095 per pound. Adding the cost of the two pounds of salt to the weighted average cost of $10.09 comes to $10.28.
Total cost of mixed bed serving: $10.28 per cu ft.
Tank Rental Income:
Because of the high costs of purchasing tanks, many new customers opt for renting tanks on a monthly basis. For purposes of these projections we will assume that:
Tank Sales:
It is assumed that those customers who do not opt to rent their tanks will already have their own tanks or will purchase tanks from H20 Industries. Sales of tanks is assumed at only five percent of the number of monthly rental tanks. Sales price is $1,200. Cost equals $450.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Unit Sales | |||
Segregated Anion Service 10 cu ft | 445 | 728 | 764 |
Segregated Cation Service 10 cu ft | 445 | 728 | 764 |
Segregated Mixed Bed 10 cu ft | 445 | 728 | 764 |
Bulk Regen 10 cu ft (MB) | 367 | 598 | 687 |
Bulk Regen 10 cu ft (Cat) | 183 | 299 | 344 |
Bulk Regen 10 cu ft (An) | 183 | 299 | 344 |
Tank Rentals (each 3.6 cu ft): | 1,436 | 2,347 | 2,546 |
Tank Sales: | 67 | 117 | 127 |
Other | 0 | 0 | 0 |
Total Unit Sales | 3,572 | 5,844 | 6,340 |
Unit Prices | Year 1 | Year 2 | Year 3 |
Segregated Anion Service 10 cu ft | $476.00 | $476.00 | $476.00 |
Segregated Cation Service 10 cu ft | $476.00 | $476.00 | $476.00 |
Segregated Mixed Bed 10 cu ft | $526.00 | $526.00 | $526.00 |
Bulk Regen 10 cu ft (MB) | $359.00 | $359.00 | $359.00 |
Bulk Regen 10 cu ft (Cat) | $267.50 | $267.50 | $267.50 |
Bulk Regen 10 cu ft (An) | $267.50 | $267.50 | $267.50 |
Tank Rentals (each 3.6 cu ft): | $40.00 | $40.00 | $40.00 |
Tank Sales: | $1,200.00 | $1,200.00 | $1,200.00 |
Other | $0.00 | $0.00 | $0.00 |
Sales | |||
Segregated Anion Service 10 cu ft | $211,820 | $346,528 | $363,664 |
Segregated Cation Service 10 cu ft | $211,820 | $346,528 | $363,664 |
Segregated Mixed Bed 10 cu ft | $234,070 | $382,928 | $401,864 |
Bulk Regen 10 cu ft (MB) | $131,753 | $214,682 | $246,633 |
Bulk Regen 10 cu ft (Cat) | $49,080 | $79,983 | $92,020 |
Bulk Regen 10 cu ft (An) | $49,080 | $79,983 | $92,020 |
Tank Rentals (each 3.6 cu ft): | $57,440 | $93,880 | $101,840 |
Tank Sales: | $80,400 | $140,400 | $152,400 |
Other | $0 | $0 | $0 |
Total Sales | $1,025,462 | $1,684,911 | $1,814,105 |
Direct Unit Costs | Year 1 | Year 2 | Year 3 |
Segregated Anion Service 10 cu ft | $107.40 | $107.40 | $107.40 |
Segregated Cation Service 10 cu ft | $87.80 | $87.80 | $87.80 |
Segregated Mixed Bed 10 cu ft | $102.80 | $102.80 | $102.80 |
Bulk Regen 10 cu ft (MB) | $61.40 | $61.40 | $61.40 |
Bulk Regen 10 cu ft (Cat) | $69.50 | $69.50 | $69.50 |
Bulk Regen 10 cu ft (An) | $72.50 | $72.50 | $72.50 |
Tank Rentals (each 3.6 cu ft): | $0.00 | $0.00 | $0.00 |
Tank Sales: | $450.00 | $450.00 | $450.00 |
Other | $0.00 | $0.00 | $0.00 |
Direct Cost of Sales | |||
Segregated Anion Service 10 cu ft | $47,793 | $78,187 | $82,054 |
Segregated Cation Service 10 cu ft | $39,071 | $63,918 | $67,079 |
Segregated Mixed Bed 10 cu ft | $45,746 | $74,838 | $78,539 |
Bulk Regen 10 cu ft (MB) | $22,534 | $36,717 | $42,182 |
Bulk Regen 10 cu ft (Cat) | $12,752 | $20,781 | $23,908 |
Bulk Regen 10 cu ft (An) | $13,302 | $21,678 | $24,940 |
Tank Rentals (each 3.6 cu ft): | $0 | $0 | $0 |
Tank Sales: | $30,150 | $52,650 | $57,150 |
Other | $0 | $0 | $0 |
Subtotal Direct Cost of Sales | $211,347 | $348,769 | $375,852 |
The relationship between dealerships and H20 Industries could be called a strategic alliance. These water service companies have an extensive customer base. Most of the customers have needs such as water softening, filtration, reverse osmosis maintenance, swimming pool maintenance, etc., however, many dealership customers have H20 Industries needs as well. At present, these water service companies must direct their customers to US Filter or supply the customer through US Filter. Forming a relationship between H20 Industries and these dealerships would quickly result in substantial sales increases for H20 Industries and would result in increased prestige and profits for the dealerships.
The management of H20 Industries is made up of individual shareholders with extensive expertise in the water treatment industry, as well as commercial and financial background.
The management team is uniquely qualified to implement this business plan. The founders, John Jones and Dave Smith, have been active in the water treatment industry for years. John’s experience working with dealers in application engineering and sales has prepared him well to present the H20 Industries dealership to water service companies that he already knows. His years of calling on dealerships in all aspects of the water industry have allowed him a birds-eye view of the prevailing marketing and business practices.
Dave has been involved in the manufacturing sector of the water industry and is well respected and connected there. His training and certification as a Professional Engineer give him an advantage when consulting with customers and prospective customers.
The person planned for the position of general manager has wide-ranging experience in finance and manufacturing. He is a former vice president of Chase Manhattan Bank, team leader of a development bank (Saudi Industrial Development Fund), and founder/general manager of a factory which, after 10 years of profitable operations, was bought out in 1989.
The production manager is a chemical engineer by education and professional experience, and has demonstrated his know-how by successfully managing the production activity in the factory despite the challenges presented by the present incomplete production line.
Regeneration Personnel : A production manager must be a skilled chemical engineer with experience in water treatment applications. This person must be a hands-on individual supervising two assistants. The production manager will label the tanks as they are received to assure customer segregation and supervise the proper regeneration cycle, from separation through backwash, draw, flush, mix, and testing. The assistants will primarily be kept busy moving tanks from one stage in the regeneration cycle to the next, connecting the hosing, performing the chemical mix and draw according to the instructions of the production manager, adding salt to the brine tank, etc. The production manager is in place. One assistant is now in place. A second is needed.
An engineer/fitter is also needed to maintain the equipment and to make installations. This person is in place.
Sales and Marketing Personnel : It is planned that both owners will continue to maintain their present positions. These sales positions require them to move about the territory which provides an excellent source of knowledge of customers for H20 Industries. This information will be communicated to the sales and marketing manager who will spend his time calling and visiting potential H20 Industries users. He will be paid a base salary plus commissions. The commission will be higher for landing a new customer, and lower for repeat sales. The commission schedule will be constructed in such a way as to permit an annual total compensation that will encourage excellent sales results.
General and Administrative : An office manager is needed. Answering phones, primary contact with customers, incoming and outgoing mail, etc. He will be the main connection between the owners and the operations of the facility. Within six months, a part-time assistant will need to be added to keep pace with bookkeeping and management.
Delivery Personnel : One driver, who has additional responsibilities, is now in place. A second will need to be added after approximately four months.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Production Personnel | |||
Production Manager | $41,604 | $41,600 | $41,600 |
Assistant | $20,796 | $20,800 | $20,800 |
Assistant | $20,796 | $20,800 | $20,800 |
Engineer/fitter | $31,200 | $31,200 | $31,200 |
Drivers | $54,198 | $58,400 | $58,400 |
Other | $0 | $0 | $0 |
Subtotal | $168,594 | $172,800 | $172,800 |
Sales and Marketing Personnel | |||
Sales Manager (base) | $24,000 | $24,000 | $24,000 |
Sales Manager (commissions) | $38,660 | $51,000 | $60,000 |
Name or title | $0 | $0 | $0 |
Other | $0 | $0 | $0 |
Subtotal | $62,660 | $75,000 | $84,000 |
General and Administrative Personnel | |||
Office Manager | $39,996 | $40,000 | $40,000 |
Bookkeeper (part-time) | $9,100 | $15,600 | $15,600 |
Name or title | $0 | $0 | $0 |
Other | $0 | $0 | $0 |
Subtotal | $49,096 | $55,600 | $55,600 |
Other Personnel | |||
Name or Title | $0 | $0 | $0 |
Name or title | $0 | $0 | $0 |
Name or title | $0 | $0 | $0 |
Other | $0 | $0 | $0 |
Subtotal | $0 | $0 | $0 |
Total People | 9 | 9 | 9 |
Total Payroll | $280,350 | $303,400 | $312,400 |
As of August 1999, stockholder equity stood at $112,000. Additional infusion of equity from new shareholders will boost the equity capital.
To complete the necessary planned additions to plant and equipment, a 5-year term loan will be required from a financial institution. The projected cash-flow is sufficient to repay this loan in quarterly installments. This term loan should be sufficient to cover the increases in accounts receivable, as well as to support growth in inventory of rental tanks.
Tax rate reflects the present sliding scale:
Inventory Turnover:
Since this is a service business, the only inventory is that of chemicals and some resin, both of which do not need to be stored more than two weeks. Average is one week (inventory turnover rate of 48).
General Assumptions | |||
Year 1 | Year 2 | Year 3 | |
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 10.00% | 10.00% | 10.00% |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% |
Tax Rate | 2.50% | 0.00% | 2.50% |
Other | 0 | 0 | 0 |
The following table and chart show the Monthly Units and Monthly Revenue Break-even calculations based on the Average Per-Unit Revenue, Average Per-Unit Variable Costs and the Estimated Monthly Fixed Costs, as drawn from the other financial tables in this plan.
Break-even Analysis | |
Monthly Units Break-even | 119 |
Monthly Revenue Break-even | $34,235 |
Assumptions: | |
Average Per-Unit Revenue | $287.08 |
Average Per-Unit Variable Cost | $59.17 |
Estimated Monthly Fixed Cost | $27,179 |
The following table and charts give the yearly projected profit and loss statement for H20 Industries. For a monthly analysis, please see attached appendix.
Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $1,025,462 | $1,684,911 | $1,814,105 |
Direct Cost of Sales | $211,347 | $348,769 | $375,852 |
Production Payroll | $168,594 | $172,800 | $172,800 |
Other | $0 | $0 | $0 |
Total Cost of Sales | $379,941 | $521,569 | $548,652 |
Gross Margin | $645,521 | $1,163,342 | $1,265,453 |
Gross Margin % | 62.95% | 69.04% | 69.76% |
Operating Expenses | |||
Sales and Marketing Expenses | |||
Sales and Marketing Payroll | $62,660 | $75,000 | $84,000 |
Advertising/Promotion | $16,500 | $12,000 | $12,000 |
Travel | $3,600 | $6,000 | $6,000 |
Fuel/oil for Vehicles: | $11,520 | $12,000 | $12,500 |
Vehicle Repair: | $20,004 | $20,000 | $20,000 |
Uniforms | $1,200 | $1,200 | $1,200 |
Miscellaneous | $10,800 | $10,800 | $10,800 |
Total Sales and Marketing Expenses | $126,284 | $137,000 | $146,500 |
Sales and Marketing % | 12.31% | 8.13% | 8.08% |
General and Administrative Expenses | |||
General and Administrative Payroll | $49,096 | $55,600 | $55,600 |
Sales and Marketing and Other Expenses | $0 | $0 | $0 |
Depreciation | $36,000 | $36,000 | $36,000 |
Leased Equipment | $15,252 | $15,252 | $15,252 |
Utilities | $2,250 | $2,250 | $2,250 |
Insurance | $11,796 | $11,800 | $11,800 |
Business Liab. Insurance: | $12,000 | $12,000 | $12,000 |
Printing and Postage: | $3,600 | $3,600 | $3,600 |
Telephone Expenses: | $8,004 | $8,000 | $8,000 |
Auditing: | $2,400 | $2,400 | $2,400 |
Rent | $24,000 | $24,000 | $24,000 |
Payroll Taxes | $35,464 | $38,380 | $39,519 |
Other General and Administrative Expenses | $0 | $0 | $0 |
Total General and Administrative Expenses | $199,862 | $209,282 | $210,421 |
General and Administrative % | 19.49% | 12.42% | 11.60% |
Other Expenses: | |||
Other Payroll | $0 | $0 | $0 |
Consultants | $0 | $0 | $0 |
Contract/Consultants | $0 | $0 | $0 |
Total Other Expenses | $0 | $0 | $0 |
Other % | 0.00% | 0.00% | 0.00% |
Total Operating Expenses | $326,146 | $346,282 | $356,921 |
Profit Before Interest and Taxes | $319,375 | $817,060 | $908,533 |
EBITDA | $355,375 | $853,060 | $944,533 |
Interest Expense | $19,755 | $12,323 | $9,948 |
Taxes Incurred | ($4,643) | $0 | $22,465 |
Net Profit | $304,263 | $804,737 | $876,120 |
Net Profit/Sales | 29.67% | 47.76% | 48.29% |
Cash Flow is an intrinsic projection for H20 Industries. We must maintain a suitable cash balance in the bank in order to be successful. The chart and table below outline our basic cash flow assumptions.
Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $0 | $0 | $0 |
Cash from Receivables | $774,831 | $1,523,736 | $1,782,529 |
Subtotal Cash from Operations | $774,831 | $1,523,736 | $1,782,529 |
Additional Cash Received | |||
Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
New Current Borrowing | $50,000 | $6,250 | $6,250 |
New Other Liabilities (interest-free) | $0 | $0 | $0 |
New Long-term Liabilities | $0 | $0 | $0 |
Sales of Other Current Assets | $50,000 | $0 | $0 |
Sales of Long-term Assets | $0 | $0 | $0 |
New Investment Received | $0 | $0 | $0 |
Subtotal Cash Received | $874,831 | $1,529,986 | $1,788,779 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $280,350 | $303,400 | $312,400 |
Bill Payments | $439,684 | $559,027 | $590,514 |
Subtotal Spent on Operations | $720,034 | $862,427 | $902,914 |
Additional Cash Spent | |||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $56,252 | $0 | $0 |
Other Liabilities Principal Repayment | $16,810 | $0 | $0 |
Long-term Liabilities Principal Repayment | $60,000 | $30,000 | $30,000 |
Purchase Other Current Assets | $63,450 | $10,350 | $9,450 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $916,546 | $902,777 | $942,364 |
Net Cash Flow | ($41,715) | $627,209 | $846,415 |
Cash Balance | $82,508 | $709,717 | $1,556,132 |
The projected balance sheet for H20 Industries is presented below.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $82,508 | $709,717 | $1,556,132 |
Accounts Receivable | $250,631 | $411,806 | $443,382 |
Inventory | $28,886 | $47,669 | $51,370 |
Other Current Assets | $103,450 | $113,800 | $123,250 |
Total Current Assets | $465,476 | $1,282,992 | $2,174,135 |
Long-term Assets | |||
Long-term Assets | $220,000 | $220,000 | $220,000 |
Accumulated Depreciation | $36,000 | $72,000 | $108,000 |
Total Long-term Assets | $184,000 | $148,000 | $112,000 |
Total Assets | $649,476 | $1,430,992 | $2,286,135 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $45,461 | $45,991 | $48,763 |
Current Borrowing | $15,102 | $21,352 | $27,602 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $60,563 | $67,343 | $76,365 |
Long-term Liabilities | $120,000 | $90,000 | $60,000 |
Total Liabilities | $180,563 | $157,343 | $136,365 |
Paid-in Capital | $187,000 | $187,000 | $187,000 |
Retained Earnings | ($22,350) | $281,913 | $1,086,650 |
Earnings | $304,263 | $804,737 | $876,120 |
Total Capital | $468,913 | $1,273,650 | $2,149,770 |
Total Liabilities and Capital | $649,476 | $1,430,992 | $2,286,135 |
Net Worth | $468,913 | $1,273,650 | $2,149,770 |
The following table gives standard business ratios for the water treatment equipment manufacturer industry, as determined by the Standard Industry Classification (SIC) Index code 3589. The last column, Industry Profile, presents specific information and important ratios for this industry.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | 64.31% | 7.67% | 8.10% |
Percent of Total Assets | ||||
Accounts Receivable | 38.59% | 28.78% | 19.39% | 25.10% |
Inventory | 4.45% | 3.33% | 2.25% | 21.60% |
Other Current Assets | 15.93% | 7.95% | 5.39% | 25.80% |
Total Current Assets | 71.67% | 89.66% | 95.10% | 72.50% |
Long-term Assets | 28.33% | 10.34% | 4.90% | 27.50% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 9.32% | 4.71% | 3.34% | 35.50% |
Long-term Liabilities | 18.48% | 6.29% | 2.62% | 21.30% |
Total Liabilities | 27.80% | 11.00% | 5.96% | 56.80% |
Net Worth | 72.20% | 89.00% | 94.04% | 43.20% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 62.95% | 69.04% | 69.76% | 32.10% |
Selling, General & Administrative Expenses | 33.28% | 21.28% | 20.22% | 17.80% |
Advertising Expenses | 1.61% | 0.71% | 0.66% | 0.90% |
Profit Before Interest and Taxes | 31.14% | 48.49% | 50.08% | 3.40% |
Main Ratios | ||||
Current | 7.69 | 19.05 | 28.47 | 2.12 |
Quick | 7.21 | 18.34 | 27.80 | 1.20 |
Total Debt to Total Assets | 27.80% | 11.00% | 5.96% | 56.80% |
Pre-tax Return on Net Worth | 63.90% | 63.18% | 41.80% | 4.50% |
Pre-tax Return on Assets | 46.13% | 56.24% | 39.31% | 10.40% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 29.67% | 47.76% | 48.29% | n.a |
Return on Equity | 64.89% | 63.18% | 40.75% | n.a |
Activity Ratios | ||||
Accounts Receivable Turnover | 4.09 | 4.09 | 4.09 | n.a |
Collection Days | 56 | 72 | 86 | n.a |
Inventory Turnover | 10.91 | 9.11 | 7.59 | n.a |
Accounts Payable Turnover | 9.32 | 12.17 | 12.17 | n.a |
Payment Days | 31 | 30 | 29 | n.a |
Total Asset Turnover | 1.58 | 1.18 | 0.79 | n.a |
Debt Ratios | ||||
Debt to Net Worth | 0.39 | 0.12 | 0.06 | n.a |
Current Liab. to Liab. | 0.34 | 0.43 | 0.56 | n.a |
Liquidity Ratios | ||||
Net Working Capital | $404,913 | $1,215,650 | $2,097,770 | n.a |
Interest Coverage | 16.17 | 66.31 | 91.33 | n.a |
Additional Ratios | ||||
Assets to Sales | 0.63 | 0.85 | 1.26 | n.a |
Current Debt/Total Assets | 9% | 5% | 3% | n.a |
Acid Test | 3.07 | 12.23 | 21.99 | n.a |
Sales/Net Worth | 2.19 | 1.32 | 0.84 | n.a |
Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |
Sales Forecast | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Unit Sales | |||||||||||||
Segregated Anion Service 10 cu ft | 0% | 14 | 19 | 23 | 27 | 31 | 35 | 40 | 44 | 48 | 52 | 56 | 57 |
Segregated Cation Service 10 cu ft | 0% | 14 | 19 | 23 | 27 | 31 | 35 | 40 | 44 | 48 | 52 | 56 | 57 |
Segregated Mixed Bed 10 cu ft | 0% | 14 | 19 | 23 | 27 | 31 | 35 | 40 | 44 | 48 | 52 | 56 | 57 |
Bulk Regen 10 cu ft (MB) | 0% | 5 | 11 | 16 | 22 | 26 | 33 | 38 | 43 | 43 | 43 | 43 | 43 |
Bulk Regen 10 cu ft (Cat) | 0% | 3 | 5 | 8 | 11 | 13 | 16 | 19 | 22 | 22 | 22 | 22 | 22 |
Bulk Regen 10 cu ft (An) | 0% | 3 | 5 | 8 | 11 | 13 | 16 | 19 | 22 | 22 | 22 | 22 | 22 |
Tank Rentals (each 3.6 cu ft): | 0% | 37 | 54 | 70 | 86 | 101 | 118 | 135 | 151 | 160 | 168 | 178 | 178 |
Tank Sales: | 0% | 2 | 2 | 3 | 4 | 5 | 5 | 7 | 7 | 8 | 8 | 8 | 8 |
Other | 0% | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Total Unit Sales | 92 | 133 | 174 | 214 | 251 | 294 | 336 | 376 | 398 | 419 | 442 | 443 | |
Unit Prices | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Segregated Anion Service 10 cu ft | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | |
Segregated Cation Service 10 cu ft | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | $476.00 | |
Segregated Mixed Bed 10 cu ft | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | $526.00 | |
Bulk Regen 10 cu ft (MB) | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | $359.00 | |
Bulk Regen 10 cu ft (Cat) | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | |
Bulk Regen 10 cu ft (An) | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | $267.50 | |
Tank Rentals (each 3.6 cu ft): | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | $40.00 | |
Tank Sales: | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | $1,200.00 | |
Other | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | |
Sales | |||||||||||||
Segregated Anion Service 10 cu ft | $6,807 | $8,806 | $10,805 | $12,804 | $14,804 | $16,803 | $18,802 | $20,801 | $22,800 | $24,800 | $26,799 | $26,989 | |
Segregated Cation Service 10 cu ft | $6,807 | $8,806 | $10,805 | $12,804 | $14,804 | $16,803 | $18,802 | $20,801 | $22,800 | $24,800 | $26,799 | $26,989 | |
Segregated Mixed Bed 10 cu ft | $7,364 | $9,731 | $11,940 | $14,149 | $16,359 | $18,568 | $20,777 | $22,986 | $25,195 | $27,405 | $29,614 | $29,982 | |
Bulk Regen 10 cu ft (MB) | $1,939 | $3,877 | $5,834 | $7,772 | $9,334 | $11,668 | $13,606 | $15,545 | $15,545 | $15,545 | $15,545 | $15,545 | |
Bulk Regen 10 cu ft (Cat) | $722 | $1,445 | $2,173 | $2,889 | $3,478 | $4,347 | $5,069 | $5,791 | $5,791 | $5,791 | $5,791 | $5,791 | |
Bulk Regen 10 cu ft (An) | $722 | $1,445 | $2,173 | $2,889 | $3,478 | $4,347 | $5,069 | $5,791 | $5,791 | $5,791 | $5,791 | $5,791 | |
Tank Rentals (each 3.6 cu ft): | $1,480 | $2,160 | $2,800 | $3,440 | $4,040 | $4,720 | $5,400 | $6,040 | $6,400 | $6,720 | $7,120 | $7,120 | |
Tank Sales: | $2,400 | $2,400 | $3,600 | $4,800 | $6,000 | $6,000 | $8,400 | $8,400 | $9,600 | $9,600 | $9,600 | $9,600 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Sales | $28,241 | $38,669 | $50,131 | $61,549 | $72,295 | $83,255 | $95,925 | $106,156 | $113,924 | $120,451 | $127,059 | $127,808 | |
Direct Unit Costs | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Segregated Anion Service 10 cu ft | 0.00% | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 | $107.40 |
Segregated Cation Service 10 cu ft | 0.00% | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 | $87.80 |
Segregated Mixed Bed 10 cu ft | 0.00% | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 | $102.80 |
Bulk Regen 10 cu ft (MB) | 0.00% | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 | $61.40 |
Bulk Regen 10 cu ft (Cat) | 0.00% | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 | $69.50 |
Bulk Regen 10 cu ft (An) | 0.00% | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 | $72.50 |
Tank Rentals (each 3.6 cu ft): | 0.00% | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
Tank Sales: | 0.00% | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 | $450.00 |
Other | 0.00% | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
Direct Cost of Sales | |||||||||||||
Segregated Anion Service 10 cu ft | $1,536 | $1,987 | $2,438 | $2,889 | $3,340 | $3,791 | $4,242 | $4,693 | $5,144 | $5,596 | $6,047 | $6,090 | |
Segregated Cation Service 10 cu ft | $1,256 | $1,624 | $1,993 | $2,362 | $2,731 | $3,099 | $3,468 | $3,837 | $4,206 | $4,574 | $4,943 | $4,978 | |
Segregated Mixed Bed 10 cu ft | $1,439 | $1,902 | $2,334 | $2,765 | $3,197 | $3,629 | $4,061 | $4,492 | $4,924 | $5,356 | $5,788 | $5,860 | |
Bulk Regen 10 cu ft (MB) | $332 | $663 | $998 | $1,329 | $1,596 | $1,996 | $2,327 | $2,659 | $2,659 | $2,659 | $2,659 | $2,659 | |
Bulk Regen 10 cu ft (Cat) | $188 | $375 | $565 | $751 | $904 | $1,129 | $1,317 | $1,505 | $1,505 | $1,505 | $1,505 | $1,505 | |
Bulk Regen 10 cu ft (An) | $196 | $392 | $589 | $783 | $943 | $1,178 | $1,374 | $1,570 | $1,570 | $1,570 | $1,570 | $1,570 | |
Tank Rentals (each 3.6 cu ft): | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Tank Sales: | $900 | $900 | $1,350 | $1,800 | $2,250 | $2,250 | $3,150 | $3,150 | $3,600 | $3,600 | $3,600 | $3,600 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Direct Cost of Sales | $5,846 | $7,843 | $10,266 | $12,679 | $14,960 | $17,072 | $19,939 | $21,906 | $23,607 | $24,859 | $26,110 | $26,260 |
Personnel Plan | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Production Personnel | |||||||||||||
Production Manager | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | $3,467 | |
Assistant | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | |
Assistant | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | $1,733 | |
Engineer/fitter | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | $2,600 | |
Drivers | $3,467 | $3,466 | $3,467 | $4,866 | $4,867 | $4,866 | $4,867 | $4,866 | $4,867 | $4,866 | $4,867 | $4,866 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $13,000 | $12,999 | $13,000 | $14,399 | $14,400 | $14,399 | $14,400 | $14,399 | $14,400 | $14,399 | $14,400 | $14,399 | |
Sales and Marketing Personnel | |||||||||||||
Sales Manager (base) | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | |
Sales Manager (commissions) | $960 | $1,500 | $2,000 | $2,500 | $3,000 | $3,700 | $3,850 | $3,950 | $4,100 | $4,250 | $4,350 | $4,500 | |
Name or title | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $2,960 | $3,500 | $4,000 | $4,500 | $5,000 | $5,700 | $5,850 | $5,950 | $6,100 | $6,250 | $6,350 | $6,500 | |
General and Administrative Personnel | |||||||||||||
Office Manager | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | |
Bookkeeper (part-time) | $0 | $0 | $0 | $0 | $0 | $1,300 | $1,300 | $1,300 | $1,300 | $1,300 | $1,300 | $1,300 | |
Name or title | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $4,633 | $4,633 | $4,633 | $4,633 | $4,633 | $4,633 | $4,633 | |
Other Personnel | |||||||||||||
Name or Title | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Name or title | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Name or title | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total People | 7 | 7 | 7 | 7 | 8 | 9 | 9 | 9 | 9 | 9 | 9 | 9 | |
Total Payroll | $19,293 | $19,832 | $20,333 | $22,232 | $22,733 | $24,732 | $24,883 | $24,982 | $25,133 | $25,282 | $25,383 | $25,532 |
General Assumptions | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Plan Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |
Current Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
Long-term Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
Tax Rate | 30.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | |
Other | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Pro Forma Profit and Loss | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Sales | $28,241 | $38,669 | $50,131 | $61,549 | $72,295 | $83,255 | $95,925 | $106,156 | $113,924 | $120,451 | $127,059 | $127,808 | |
Direct Cost of Sales | $5,846 | $7,843 | $10,266 | $12,679 | $14,960 | $17,072 | $19,939 | $21,906 | $23,607 | $24,859 | $26,110 | $26,260 | |
Production Payroll | $13,000 | $12,999 | $13,000 | $14,399 | $14,400 | $14,399 | $14,400 | $14,399 | $14,400 | $14,399 | $14,400 | $14,399 | |
Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Cost of Sales | $18,846 | $20,842 | $23,266 | $27,078 | $29,360 | $31,471 | $34,339 | $36,305 | $38,007 | $39,258 | $40,510 | $40,659 | |
Gross Margin | $9,395 | $17,827 | $26,865 | $34,470 | $42,935 | $51,783 | $61,586 | $69,852 | $75,917 | $81,194 | $86,549 | $87,148 | |
Gross Margin % | 33.27% | 46.10% | 53.59% | 56.01% | 59.39% | 62.20% | 64.20% | 65.80% | 66.64% | 67.41% | 68.12% | 68.19% | |
Operating Expenses | |||||||||||||
Sales and Marketing Expenses | |||||||||||||
Sales and Marketing Payroll | $2,960 | $3,500 | $4,000 | $4,500 | $5,000 | $5,700 | $5,850 | $5,950 | $6,100 | $6,250 | $6,350 | $6,500 | |
Advertising/Promotion | $1,900 | $1,900 | $1,900 | $1,900 | $1,900 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | |
Travel | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | |
Fuel/oil for Vehicles: | $960 | $960 | $960 | $960 | $960 | $960 | $960 | $960 | $960 | $960 | $960 | $960 | |
Vehicle Repair: | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | $1,667 | |
Uniforms | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | $100 | |
Miscellaneous | $900 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | $900 | |
Total Sales and Marketing Expenses | $8,787 | $9,327 | $9,827 | $10,327 | $10,827 | $10,627 | $10,777 | $10,877 | $11,027 | $11,177 | $11,277 | $11,427 | |
Sales and Marketing % | 31.11% | 24.12% | 19.60% | 16.78% | 14.98% | 12.76% | 11.23% | 10.25% | 9.68% | 9.28% | 8.88% | 8.94% | |
General and Administrative Expenses | |||||||||||||
General and Administrative Payroll | $3,333 | $3,333 | $3,333 | $3,333 | $3,333 | $4,633 | $4,633 | $4,633 | $4,633 | $4,633 | $4,633 | $4,633 | |
Sales and Marketing and Other Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Depreciation | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | |
Leased Equipment | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | $1,271 | |
Utilities | $250 | $250 | $250 | $250 | $250 | $250 | $250 | $100 | $100 | $100 | $100 | $100 | |
Insurance | $983 | $983 | $983 | $983 | $983 | $983 | $983 | $983 | $983 | $983 | $983 | $983 | |
Business Liab. Insurance: | $0 | $0 | $0 | $0 | $0 | $6,000 | $0 | $0 | $0 | $0 | $0 | $6,000 | |
Printing and Postage: | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | $300 | |
Telephone Expenses: | $667 | $667 | $667 | $667 | $667 | $667 | $667 | $667 | $667 | $667 | $667 | $667 | |
Auditing: | $0 | $0 | $0 | $2,400 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Rent | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | |
Payroll Taxes | 13% | $2,441 | $2,509 | $2,572 | $2,812 | $2,876 | $3,129 | $3,148 | $3,160 | $3,179 | $3,198 | $3,211 | $3,230 |
Other General and Administrative Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total General and Administrative Expenses | $14,245 | $14,313 | $14,376 | $17,016 | $14,680 | $22,233 | $16,252 | $16,114 | $16,133 | $16,152 | $16,165 | $22,184 | |
General and Administrative % | 50.44% | 37.01% | 28.68% | 27.65% | 20.31% | 26.70% | 16.94% | 15.18% | 14.16% | 13.41% | 12.72% | 17.36% | |
Other Expenses: | |||||||||||||
Other Payroll | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Consultants | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Contract/Consultants | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Total Other Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Other % | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | |
Total Operating Expenses | $23,032 | $23,640 | $24,203 | $27,343 | $25,507 | $32,860 | $27,029 | $26,991 | $27,160 | $27,329 | $27,442 | $33,611 | |
Profit Before Interest and Taxes | ($13,636) | ($5,812) | $2,662 | $7,127 | $17,428 | $18,924 | $34,558 | $42,860 | $48,756 | $53,864 | $59,107 | $53,538 | |
EBITDA | ($10,636) | ($2,812) | $5,662 | $10,127 | $20,428 | $21,924 | $37,558 | $45,860 | $51,756 | $56,864 | $62,107 | $56,538 | |
Interest Expense | $1,840 | $1,773 | $1,769 | $1,765 | $1,698 | $1,694 | $1,689 | $1,622 | $1,618 | $1,614 | $1,547 | $1,126 | |
Taxes Incurred | ($4,643) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Net Profit | ($10,834) | ($7,586) | $893 | $5,362 | $15,730 | $17,230 | $32,868 | $41,238 | $47,138 | $52,251 | $57,560 | $52,412 | |
Net Profit/Sales | -38.36% | -19.62% | 1.78% | 8.71% | 21.76% | 20.70% | 34.26% | 38.85% | 41.38% | 43.38% | 45.30% | 41.01% |
Pro Forma Cash Flow | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Cash Received | |||||||||||||
Cash from Operations | |||||||||||||
Cash Sales | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Cash from Receivables | $0 | $941 | $28,588 | $39,051 | $50,512 | $61,907 | $72,660 | $83,677 | $96,266 | $106,415 | $114,141 | $120,672 | |
Subtotal Cash from Operations | $0 | $941 | $28,588 | $39,051 | $50,512 | $61,907 | $72,660 | $83,677 | $96,266 | $106,415 | $114,141 | $120,672 | |
Additional Cash Received | |||||||||||||
Sales Tax, VAT, HST/GST Received | 0.00% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
New Current Borrowing | $50,000 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Other Current Assets | $50,000 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
New Investment Received | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Received | $100,000 | $941 | $28,588 | $39,051 | $50,512 | $61,907 | $72,660 | $83,677 | $96,266 | $106,415 | $114,141 | $120,672 | |
Expenditures | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Expenditures from Operations | |||||||||||||
Cash Spending | $19,293 | $19,832 | $20,333 | $22,232 | $22,733 | $24,732 | $24,883 | $24,982 | $25,133 | $25,282 | $25,383 | $25,532 | |
Bill Payments | $61,849 | $13,625 | $25,719 | $28,739 | $33,600 | $33,584 | $40,540 | $38,353 | $39,147 | $40,550 | $41,335 | $42,644 | |
Subtotal Spent on Operations | $81,142 | $33,457 | $46,052 | $50,971 | $56,333 | $58,316 | $65,423 | $63,335 | $64,280 | $65,832 | $66,718 | $68,176 | |
Additional Cash Spent | |||||||||||||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Principal Repayment of Current Borrowing | $521 | $521 | $521 | $521 | $521 | $521 | $521 | $521 | $521 | $521 | $521 | $50,521 | |
Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $16,810 | |
Long-term Liabilities Principal Repayment | $30,000 | $7,500 | $0 | $0 | $7,500 | $0 | $0 | $7,500 | $0 | $0 | $7,500 | $0 | |
Purchase Other Current Assets | $0 | $0 | $0 | $5,400 | $8,550 | $9,900 | $9,900 | $9,450 | $5,400 | $4,500 | $10,350 | $0 | |
Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Spent | $111,663 | $41,478 | $46,573 | $56,892 | $72,904 | $68,737 | $75,844 | $80,806 | $70,201 | $70,853 | $85,089 | $135,507 | |
Net Cash Flow | ($11,663) | ($40,537) | ($17,984) | ($17,840) | ($22,392) | ($6,830) | ($3,184) | $2,871 | $26,066 | $35,562 | $29,052 | ($14,836) | |
Cash Balance | $112,560 | $72,023 | $54,039 | $36,198 | $13,806 | $6,977 | $3,793 | $6,664 | $32,730 | $68,292 | $97,344 | $82,508 |
Pro Forma Balance Sheet | |||||||||||||
Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
Assets | Starting Balances | ||||||||||||
Current Assets | |||||||||||||
Cash | $124,223 | $112,560 | $72,023 | $54,039 | $36,198 | $13,806 | $6,977 | $3,793 | $6,664 | $32,730 | $68,292 | $97,344 | $82,508 |
Accounts Receivable | $0 | $28,241 | $65,969 | $87,511 | $110,009 | $131,792 | $153,140 | $176,405 | $198,884 | $216,541 | $230,577 | $243,495 | $250,631 |
Inventory | $10,000 | $6,430 | $8,627 | $11,293 | $13,947 | $16,456 | $18,780 | $21,933 | $24,096 | $25,968 | $27,345 | $28,721 | $28,886 |
Other Current Assets | $90,000 | $40,000 | $40,000 | $40,000 | $45,400 | $53,950 | $63,850 | $73,750 | $83,200 | $88,600 | $93,100 | $103,450 | $103,450 |
Total Current Assets | $224,223 | $187,230 | $186,619 | $192,843 | $205,554 | $216,004 | $242,746 | $275,881 | $312,844 | $363,839 | $419,314 | $473,010 | $465,476 |
Long-term Assets | |||||||||||||
Long-term Assets | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 | $220,000 |
Accumulated Depreciation | $0 | $3,000 | $6,000 | $9,000 | $12,000 | $15,000 | $18,000 | $21,000 | $24,000 | $27,000 | $30,000 | $33,000 | $36,000 |
Total Long-term Assets | $220,000 | $217,000 | $214,000 | $211,000 | $208,000 | $205,000 | $202,000 | $199,000 | $196,000 | $193,000 | $190,000 | $187,000 | $184,000 |
Total Assets | $444,223 | $404,230 | $400,619 | $403,843 | $413,554 | $421,004 | $444,746 | $474,881 | $508,844 | $556,839 | $609,314 | $660,010 | $649,476 |
Liabilities and Capital | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
Current Liabilities | |||||||||||||
Accounts Payable | $61,409 | $12,771 | $24,766 | $27,618 | $32,488 | $32,230 | $39,262 | $37,050 | $37,796 | $39,173 | $39,919 | $41,076 | $45,461 |
Current Borrowing | $21,354 | $70,833 | $70,312 | $69,791 | $69,270 | $68,749 | $68,228 | $67,707 | $67,186 | $66,665 | $66,144 | $65,623 | $15,102 |
Other Current Liabilities | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $16,810 | $0 |
Subtotal Current Liabilities | $99,573 | $100,414 | $111,888 | $114,219 | $118,568 | $117,789 | $124,300 | $121,567 | $121,792 | $122,648 | $122,873 | $123,509 | $60,563 |
Long-term Liabilities | $180,000 | $150,000 | $142,500 | $142,500 | $142,500 | $135,000 | $135,000 | $135,000 | $127,500 | $127,500 | $127,500 | $120,000 | $120,000 |
Total Liabilities | $279,573 | $250,414 | $254,388 | $256,719 | $261,068 | $252,789 | $259,300 | $256,567 | $249,292 | $250,148 | $250,373 | $243,509 | $180,563 |
Paid-in Capital | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 | $187,000 |
Retained Earnings | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) | ($22,350) |
Earnings | $0 | ($10,834) | ($18,420) | ($17,527) | ($12,164) | $3,566 | $20,796 | $53,664 | $94,902 | $142,040 | $194,291 | $251,851 | $304,263 |
Total Capital | $164,650 | $153,816 | $146,230 | $147,123 | $152,486 | $168,216 | $185,446 | $218,314 | $259,552 | $306,690 | $358,941 | $416,501 | $468,913 |
Total Liabilities and Capital | $444,223 | $404,230 | $400,619 | $403,843 | $413,554 | $421,004 | $444,746 | $474,881 | $508,844 | $556,839 | $609,314 | $660,010 | $649,476 |
Net Worth | $164,650 | $153,816 | $146,230 | $147,123 | $152,486 | $168,216 | $185,446 | $218,314 | $259,552 | $306,690 | $358,941 | $416,501 | $468,913 |
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Starting a bottled water company can be very profitable. With proper planning, execution and hard work, you can enjoy great success. Below you will learn the keys to launching a successful bottled water company.
Importantly, a critical step in starting a bottled water company is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here .
Download our Ultimate Business Plan Template here
The first step to starting a bottled water company is to choose your business’ name.
This is a very important choice since your company name is your brand and will last for the lifetime of your business. Ideally you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your own bottled water business:
One of the most important steps in starting a water company is to develop your bottled water business plan . The process of creating your plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to funding sources to raise money for your business.
Your business plan should include the following sections:
3. choose the legal structure for your bottled water company.
Next you need to choose a legal structure for your bottled water company and register it and your business name with the Secretary of State in each state where you operate your business.
Below are the five most common legal structures:
A sole proprietorship is a business entity in which the owner of the bottled water company and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.
A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to open a bottled water company together. The partners share in the profits and losses of the business.
The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.
A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a bottled water company include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.
A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a bottled water company is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.
An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.
Once you register your bottled water company, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.
In developing your bottled water company business plan , you might have determined that you need to raise funding to launch your business.
If so, the main sources of funding for a bottled water company to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a bottled water company that they believe has high potential for growth.
There are a few things to consider when looking for a location for your bottled water company. Firstly, you’ll need to find a production and storage space that is big enough to store all of your bottles and equipment. If you’re bottling spring water, you’ll also want to find a location that has easy access to a spring. For most other water types, you will need enough land to drill a well, unless you plan to enhance public tap water. Additionally, you’ll want to choose a space that is close to a transportation hub, so you can easily distribute bottled water.
Once you’ve found the perfect location for your bottled water company, there are a few things to consider when designing your space. You will need a substantial amount of room for the machinery involved in bottling water. It’s also a good idea to include a room dedicated to shipping and receiving.
Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).
Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.
Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.
It is important to establish a bank account in your bottled water company’s name. This process is fairly simple and involves the following steps:
You should get a business credit card for your bottled water company to help you separate personal and business expenses.
You can either apply for a business credit card through your bank or apply for one through a credit card company.
When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.
Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your business. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.
The licenses and permits you need to launch a bottled water company will vary depending on your location. However, some common licenses and permits include a business license, a license from the FDA, and a permit from your state health department. Make sure to research the specific licenses and permits required for your business, and contact your local government agency for more information.
The type of insurance you need to operate a bottled water company will vary depending on the state in which you reside.
Types of business insurance policies that you should consider for your bottled water company include:
Find an insurance agent, tell them about your business and its needs, and they will recommend policies that fit those needs.
To launch a bottled water company, you will need:
Marketing materials will be required to attract and retain customers to your bottled water company.
The key marketing materials you will need are as follows:
The software you need to run a bottled water company is:
You are now ready to open your bottled water company. If you followed the steps above, you should be in a great position to build a successful bottled water business. Below are answers to frequently asked questions that might further help you with how to start a spring water business.
Don’t you wish there was a faster, easier way to finish your bottled water company business plan?
With Growthink’s Ultimate Business Plan Template you can finish your plan in just 8 hours or less!
Where can i download a bottled water business plan pdf.
You can download our Bottled Water business plan PDF here. This is a business plan template you can use in PDF format.
Starting a bottled water company is not hard but it does take some effort and planning. The most important part is making sure you have a good product that people will want to buy.
There are a few ways that you can open a water bottling plant with no experience. You can start by researching the bottled water industry and learning about the different types of water that are available, the production process, and the marketing and distribution channels that are used in the industry. You can also research the different ways that you can get your bottled water into stores and learn about similar companies to find out what works best in your area. By getting a few years of experience under your belt before starting a bottled water company, you will be able to avoid making some common mistakes during this time in order to save money.
The most profitable bottled water company is the one that can provide the best quality of water at a low price. At present, natural spring water is the most popular and profitable type of bottled water.
The cost of starting a bottled water company can range from $500,000 to $1.5 million, depending on the size and type of company you want to start. Some costs involved in this business are facility cost, label design and purchase, water testing, water treatment machines , marketing materials, transportation costs of the product to distributors or retailers.
The ongoing expenses for a bottled water company typically include the cost of bottles, labels, labor, and shipping. Further, the cost of maintenance on your water treatment machines can be high. The cost of warehousing or transportation may also be incorporated into the ongoing expenses calculation.
A water bottling company makes money by charging a premium for their product. The cost of water is often lower than the cost of producing and delivering the water, so companies can make a profit by charging more for bottled water than it costs to produce. Additionally, bottled water businesses can also sell advertising space on their bottles, which brings in additional revenue.
Yes, bottled water businesses are profitable, but the profit margins vary depending on the company. The main benefit of owning a bottled water company is that the product is not perishable, so it can be stored and sold for a higher price than other types of drinks. People are increasingly choosing to drink water from bottles over tap water. This is due in part to the perception that bottled water is healthy drinking water , but also because of the many different flavors and brands of bottled water available.
Bottled water companies fail because of the high price of the product and the environmental concerns associated with it. Some bottled water plants also fail because they are unable to convince the public that their product is worth the price.
Bottled water businesses deal in the bottling and distributing of drinking water to consumers. Whether purified, distilled, or natural spring water, your bottled water business will supply your customers with ample hydration. Taking the steps to start your own bottled water business can be a satisfying experience that allows you to make money while also helping your customers achieve a healthy lifestyle.
Ready to turn your business idea into a reality? We recommend forming an LLC as it is the most affordable way to protect your personal assets. You can do this yourself or with our trusted partner for a small fee. Northwest ($29 + State Fees) DIY: How to Start an LLC
We have put together this simple guide to starting your bottled water business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Exploring your options? Check out other small business ideas .
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
Luckily we have done a lot of this research for you.
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Bottled Water Business Name Generator
If you operate a sole proprietorship , you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.
When registering a business name , we recommend researching your business name by checking:
It's very important to secure your domain name before someone else does.
Powered by godaddy.com, what are the costs involved in opening a bottled water business.
Costs for starting a water treatment plant include storage tanks, filling machines, water treatment machines, filters, conveyors, sealers, water sterilizers, water dispensers, bottle loaders, trucks, and employees to work in the plant.
Startup costs can range from $500,000 to $750,000 for a “bare bones” plant. However, some plants may require more capital, up to $1.5 million, or more, depending on the size of your operation.
You will also need a license from the U.S. Food And Drug Administration (FDA). You will also need a permit from your state health department.
Finally, you’ll need a dedicated bottle supplier, a water source, and employees to run your plant. This is a very labor-intensive job.
Ongoing expenses are extensive. Maintenance on the plant can cost tens of thousands of dollars every year for a small plant, and as much (or more) every month for a medium to large-scale bottled water plant.
Utility costs can also be high, due to the process of purifying and bottling water.
Labor costs are also high, as most employees expect a full-time salary, plus benefits. Liability insurance, health insurance, unemployment insurance, 401(k) matching and administrative services, and worker’s compensation insurance can run tens of thousands of dollars per month.
Customers are usually commercial enterprises like local grocery stores. However, some small companies do sell directly to consumers or to businesses.
A bottled water business makes money by charging customers for processing and bottling potable water.
Bottled water has a high markup. If you are selling to grocery stores, you may be able to charge $1 to $2 per bottle, or a flat rate per truckload or pallet. Most companies make arrangements for regular shipments to establish themselves as “anchor customers.” You may or may not sell your products for a lower price to get these deals, but will generally increase revenue as a result.
Profits can range between 100% and 500%, or more.
Your business can become even more profitable by entering niche markets such as flavored bottled water, sparkling water, spring water, and mineral water. Some companies have specialty lines of water, which include flavored mineral water, flavored sparkling water, and sports drinks.
Finally, consider offering designer waters, seltzer waters and club soda, and flavored soda.
Want a more guided approach? Access TRUiC's free Small Business Startup Guide - a step-by-step course for turning your business idea into reality. Get started today!
One crucial aspect that cannot be overlooked when starting your bottled water business is the importance of establishing a solid business foundation. While sole proprietorships and partnerships are the most common entity types for small businesses, they're a far less stable and advantageous option than LLCs.
This is because unincorporated business structures (i.e., sole proprietorships and partnerships) expose you as an owner to personal liability for your business's debts and legal actions, while LLCs protect you by keeping your personal assets separate from your business's liabilities.
In practice, this means that if your bottled water business were to face a lawsuit or incur any debts, your savings, home, and other personal assets could not be used to cover these costs. On top of this, forming your business as an LLC also helps it to appear more legitimate and trustworthy.
More than 84% of our readers opt to collaborate with a professional LLC formation service to kickstart their venture. We've negotiated a tailored discount for our readers, bringing the total down to just $29.
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Note: If you're interested in more information before getting started, we recommend having a look at our state-specific How to Start an LLC guide (DIY) or our in-depth Best LLC Services review (for those opting for a professional service).
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN through the IRS website . If you would like to learn more about EINs, read our article, What is an EIN?
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil .
Besides being a requirement when applying for business loans, opening a business bank account:
Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.
Getting a business credit card helps you:
Recommended: Apply for an easy approval business credit card from BILL and build your business credit quickly.
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
Make LLC accounting easy with our LLC Expenses Cheat Sheet.
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
The Food and Drug Administration (FDA) regulates bottled water. FDA regulations for bottled water include Good Manufacturing Practices (GMPs), standards of identity and labeling requirements.
A detailed description of regulation, licensing and labeling requirements can be found here .
Certain state permits and licenses may be needed to operate a bottled water business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits .
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses .
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance . This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance . If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
FInd out what types of insurance your Bottled Water Business needs and how much it will cost you by reading our guide Business Insurance for Bottled Water Business.
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners , we'll give you helpful tips and advice for creating the best unique logo for your business.
Recommended : Get a logo using Truic's free logo Generator no email or sign up required, or use a Premium Logo Maker .
If you already have a logo, you can also add it to a QR code with our Free QR Code Generator . Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.
Marketing and distribution is key in this business. Your target market should be grocers, vending machine companies and operators, stadiums, event locations, and other large-scale commercial enterprises and operations that need high volume bottled water supplies.
Make sure you deliver on your promises and be competitive on your pricing. This is a highly commoditized industry. Often, it’s the business that meets deadlines and has the lowest (or at least competitive) pricing that wins.
After defining your brand and creating your logo the next step is to create a website for your business .
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
Recommended : Get started today using our recommended website builder or check out our review of the Best Website Builders .
Other popular website builders are: WordPress , WIX , Weebly , Squarespace , and Shopify .
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2023 to find the best phone service for your small business.
Recommended Business Phone Service: Phone.com
Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.
This business is perfect for individuals who are passionate about their health or are health conscious and want to run a business that promotes a healthy lifestyle.
Take our Entrepreneurship Quiz to find out!
Entrepreneurship Quiz
The day-to-day operations of a plant depend largely on the type of plant you run.
There are many different ways to process bottled water. Spring water is one of the most common. It comes from an underground formation and flows naturally to the earth's surface. Purified drinking water is one that is processed to remove chlorine and other contaminants. Unless your plant processes public sources of water, like municipal drinking water, you are not usually required to disclose where you sourced it.
Natural sparkling water is naturally carbonated water from a spring or well. Mineral water comes from a spring and contains dissolved minerals like magnesium, calcium, sodium, potassium, and silica and bicarbonates. Finally, seltzer water is an FDA-regulated soft drink product.
The day-to-day operations include bringing in water from an outside source and bottling it. During this process, there are many intermediary steps, including sanitising containers, preparing bottles preparing and filtering the water, and setting up packaging protocols to ensure that the water is ready to be shipped.
You will need business experience, contacts in the industry, and a working understanding of how water is purified. No degrees are necessary but you may need special permitting and licensing from the government. Most owners and managers of a bottled water business have extensive management experience, especially in a related industry.
Growth potential is virtually unlimited. Companies like Nestle own massive water processing and treatment plants where they produce bottled water for countless grocery stores and make billions in profits every year.
Most bottled water plants start life as small or medium-sized plants.
You can grow your business at a rapid pace by taking on outside financing from a bank or venture capital firm. Or, you can grow more organically from sales profits. Growing through leverage (bank loans) has its advantages. For example, your profits are likely to climb quickly on momentum. This can shortcut the time it takes you to grow and meet your revenue growth targets. However, it can also saddle you with creditors who want to see target revenue and profit targets that are too optimistic.
Growing organically is prevents this from happening, but it also slows growth and might prevent you from growing beyond a certain size.
For fun informative videos about starting a business visit the TRUiC YouTube Channel or subscribe to view later.
Find a business mentor.
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
Spend time finding a sustainable water source for your operation. Your water source will greatly influence your profits. If you find a source that costs $3 to $5 per 1,000 liters, this is going to result in a higher profit than if you’re paying the same amount for 100 liters of water.
You must begin building a team immediately. A bottled water company cannot operate as a solo or one-person company. You will need at least 20 to 50 employees to start, and you should scale up within the first 3 years to at least 50 to 100 employees, or more.
Industry opportunities.
Thinking of starting a water company? You're in the right place! ClickUp's Business Plan Template for Water Companies is here to guide you through every step of the process, from defining your mission to projecting your financials.
With this template, you'll be able to:
Don't navigate the waters of entrepreneurship alone. Dive into our Business Plan Template for Water Companies and make a splash in the industry today!
When water companies and entrepreneurs in the water industry use the Business Plan Template for Water Companies, they can enjoy a range of benefits, including:
ClickUp’s Business Plan Template for Water Companies provides a comprehensive framework to help water companies and entrepreneurs in the water industry create a strong business plan. Here are the main elements of this template:
If you're in the water industry and need to create a business plan, look no further than the Business Plan Template for Water Companies in ClickUp. Follow these five steps to get started:
Start by clearly defining your business concept and goals. What is the unique selling proposition of your water company? Are you focused on providing clean drinking water to rural areas or offering sustainable water solutions for commercial clients? Clearly define your target market, revenue streams, and growth objectives.
Use the Goals feature in ClickUp to set and track your business goals, ensuring that you stay focused and motivated throughout the process.
To build a successful business plan, you need to have a deep understanding of the market you're entering. Research your target market, including customer demographics, competitors, and industry trends. Identify any gaps or opportunities in the market that your water company can capitalize on.
Use the Table view in ClickUp to organize and analyze your market research data, ensuring that you have a comprehensive understanding of the industry landscape.
A strong marketing strategy is essential for attracting customers and growing your water company. Determine the best channels to reach your target audience, whether it's through digital marketing, partnerships with local organizations, or attending industry conferences. Outline your pricing strategy, promotional activities, and customer acquisition plan.
Use the Board view in ClickUp to visually plan and manage your marketing strategy, ensuring that you have a clear overview of all your marketing initiatives.
A solid financial plan is crucial for the success of your water company. Estimate your startup costs, monthly expenses, and projected revenue. Consider factors such as equipment and infrastructure costs, employee salaries, and ongoing operational expenses. Determine how you will fund your business and create realistic financial projections for the next few years.
Use the Gantt chart in ClickUp to create a timeline for your financial plan, outlining key milestones and financial goals that you want to achieve.
Once your business plan is in place, it's important to continuously monitor and adjust your strategies as needed. Regularly review your financial performance, marketing efforts, and customer feedback to identify areas of improvement and make necessary adjustments. Stay agile and adaptable to market changes and industry trends to ensure the long-term success of your water company.
Use the Dashboards feature in ClickUp to track key performance indicators (KPIs) and get a holistic view of your business's progress, allowing you to make data-driven decisions and optimize your strategies accordingly.
Water companies and entrepreneurs in the water industry can use the ClickUp Business Plan Template to streamline the process of creating a comprehensive business plan that covers all aspects of their operations.
First, hit "Add Template" to sign up for ClickUp and add the template to your Workspace. Make sure you designate which Space or location in your Workspace you'd like this template applied.
Next, invite relevant members or guests to your Workspace to start collaborating.
Now you can take advantage of the full potential of this template to create a solid business plan:
Free forever with 100mb storage.
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If you want to start a Bottled Water business or expand your current Bottled Water business, you need a business plan.
The following Bottled Water business plan template gives you the key elements to include in a winning Bottled Water business plan.
You can download our business plan template (including a full, customizable financial model) to your computer here.
Below are links to each of the key sections of your Bottled Water business plan: I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan
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Bottled Water Business Plan Home I. Executive Summary II. Company Overview III. Industry Analysis IV. Customer Analysis V. Competitive Analysis VI. Marketing Plan VII. Operations Plan VIII. Management Team IX. Financial Plan
Updated: January 23, 2024
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The bottled water industry is a lucrative market, valued at over $316.76 billion in 2023 . As health trends shift towards sugar-free options and consumers place greater value on convenience, bottled water has become one of the fastest-growing beverage segments, with an expected 6.14% growth rate from 2023 to 2028.
Tap into this high-demand niche with your own bottled water company. Determine your production capacity and distribution reach to target specific client segments – from grocery chains to hotels and gyms to hospitals. Research permits, equipment, and testing are needed to bottle natural springs or purified water.
This guide will explain how to start a bottled water company. Topics include market research, competitive analysis, obtaining business insurance, forming an LLC, customer focus, registering an EIN, and more.
Market research is essential to water bottling company newcomers. It offers insight into market trends, target market, market saturation, and other details integral to starting your own bottled water business.
Some details you’ll learn through market research include:
With strategic planning, emerging bottled water companies can capitalize on this growth market by identifying an under-served niche, differentiating through unique mineral content claims, or disruptive filtration methods for purified water. The rewarding margins provide healthy profit potential to establish your footprint here.
Understanding the competitive landscape is key for new bottled water companies aiming to secure market share. Investigating other bottled water businesses offers an important look into local pricing, services, water treatment machines, and even where to base your water bottling plant.
Research major brands and regional players to analyze pricing, packaging, labeling claims, and target demographics. For example, budget offerings like Aquafina or higher-priced imports like Fiji. Visit grocery stores, convenience shops, gyms, and hotels to see first-hand what’s stocked and promoted through displays or signage.
Evaluate direct local competitors by obtaining samples to compare factors like taste, mineral content, and water purity against your own. Identify where potential gaps exist you could fill or areas where you can parallel and then surpass through unique selling points like enhanced filtration methods or custom mineral blends.
Online competitor analysis examines SEO visibility, website engagement metrics, social media followings, and customer sentiment in reviews. Leverage free tools like SEMrush, BuzzSumo, and Facebook Audience Insights to benchmark competitors’ site traffic, top-performing content, and user demographics.
Ongoing monitoring of sales patterns, product line expansions, and marketing campaigns keeps your competitive strategy sharp and adaptive. This vigilance primes you to counter key market threats through greater value offerings tailored to reach more customers. For instance, some competitors may sell their products to liquor stores to complement the products already on offer while others partner with catering businesses to maximize sales.
When launching a bottled water company, significant capital is required, especially on the front end. From sourcing spring water access to bottling equipment to product distribution, expenses add up. We’ll analyze typical start-up and ongoing costs to factor into your business plan.
Securing spring water rights often demands upfront investments starting around $50,000. Licensing and exploratory drilling fees apply, along with hydrology tests to analyze water quality, yields, and sustainability.
Bottling equipment represents a significant expense. Automated machinery for washing, filling, and capping bottles can run $75,000 to $100,000 or more. Additional filtration systems to purify water and monitoring devices cost extra. Allow at least $150,000 total for industrial-scale equipment.
Product testing and reporting must conform to state and federal safety regulations. Initial lab work and analysis averages $1,500. Recurring quarterly testing and reporting may require partnerships with water quality assurance labs.
Branding and package design are critical for shelf appeal and company recognition. Budget around $6,000-$10,000 for logo design, labeling, and prototyping your plastic or glass bottles.
Other expenses include warehouse space leasing, shipping pallets, office furnishings, and legal/professional services for business licensing, contracts, and financing, costing roughly $30,000 in total.
In total, around $250,000 or more provides a reasonable fund for covering core start-up costs. Additional operating capital gives flexibility for overruns.
Raw materials represent water businesses’ highest ongoing expenditure. Sourcing and bottling enough spring water to meet demand, allowing for spillage – called “overage” – runs approximately $0.20 to $0.40 per gallon.
Plastic bottle production, including cap, label, and packaging averages $0.12 to $0.20 per unit. Opting for glass can nearly double per-unit costs. With recycled PET and bulk bottle orders, materials may cost $0.10 per piece.
Depending on production volumes, plan on at least $15,000 to $25,000 monthly for raw materials including water sourcing, bottles, labeling, and packaging.
Warehousing fees are another major line item, with small-operation monthly rates starting around $1,500. Variable storage fees and pallet spacing needs can quickly increase costs though. Depending on business growth, dedicate at least $18,000 but likely more annually.
Ongoing quality control testing will run about $3,000 quarterly. Marketing expenses like trade show participation, sales commissions, and advertising depend on distribution scale but often range from $2,500 monthly for regional bottlers. Account for another $10,000+ annually.
Other recurring operating expenses like equipment maintenance, insurance premiums, administrative fees, and payroll contribute added overhead. Evaluate your organizational blueprint, production goals, and sales territory to accurately forecast costs.
When establishing a bottled water company, the legal structure carries major implications for liability, tax treatment, and ease of expansion. We’ll analyze the key options – sole proprietorship, partnership, LLC, and corporation – specifically for this industry.
A sole proprietorship has simple paperwork and full owner control, but zero liability protection where owners’ assets could be seized.
Partnerships allow pooling resources and splitting profits but still expose personal assets. Difficult to add new partners later without amending complex agreements.
A limited liability corporation (LLC) emerges as the prime structure for bottled water businesses. LLCs limit owners’ liability, so their homes and bank accounts stay protected. Tax flexibility allows filing as a corporation or pass-through entity. No ownership restrictions facilitate bringing on investors or additional bottling plants under the LLC umbrella. Admin fees of around $100+ annually prove reasonable.
Converting to a C-corporation has appeal for major expansion plans, including potentially going public someday. But double taxation of profits and dividends deter small bottlers. Additionally, increased legal oversight on policies and share distribution must be managed through annual filings. For mid-size operators though, S-corp election retains LLC tax advantages without the C-corp burdens.
Even sole proprietors must obtain an Employer Identification Number (EIN) when establishing a formal business. This unique 9-digit number acts like a Social Security Number for your company when opening business bank accounts and filing taxes. EINs are free and easy to obtain directly from the IRS.
As a bottled water provider selling products, you are legally required to furnish an EIN for state sales and excise tax reporting along with federal tax purposes. Follow this streamlined process:
First, have key details handy including your Social Security #, business name, addresses, and the exact format of your business entity (LLC, sole proprietorship, etc). Then simply visit IRS.gov and click “Apply Online Now” for instant EIN confirmation.
Answer a few identification questions about your company and owners through the user-friendly screens. Typically approval takes just 3-4 minutes for immediate access to your EIN. Print/screenshot the notice then add this essential number to your small business bookkeeping files.
There are no EIN application fees when processing directly through the IRS portal. However, some third-party services charging unnecessary fees appear in online searches, so double-check your land at IRS.gov to avoid scams.
With your federal EIN established, contact your state revenue department to formally register for sales tax collection needs relevant to bottled beverage distribution. Basic state registration costs around $50. You’ll need to file regular sales tax reports and payments later on based on taxable transaction volume. However, the EIN serves as the key business identifier throughout federal and state reporting.
Meticulous financial recordkeeping provides the foundation for commercial success and IRS compliance. For bottled water companies, accounting accuracy across production, inventory, sales, and expenses prevents costly errors that erode profitability. Software and professional guidance facilitate managing finances.
Deploying small business accounting software like QuickBooks allows seamless syncing of bank/credit card transactions into relevant categories for easy tracking. Dashboards and reporting generate real-time visibility on profit drivers like production costs per bottle.
Inventory management integrates with bottling systems and warehouses to track usage. Sales tax calculations are also simplified by linking sales data. At around $25-50 monthly, automation delivers immense time and money savings over manual methods.
Enlisting an accountant’s expertise provides additional quality control for bottlers through services like bookkeeping cleanup, payroll processing, quarterly sales tax filings, and custom reporting on key profit drivers. Expect costs between $200-$500 monthly.
Fundamentally, separating finances avoids commingling personal and business transactions that trigger IRS red flags, unnecessary tax burdens, and disputes over who owns what assets. Establish dedicated accounts, cards, and documentation flowing through proper bottling company channels from day one.
Applying for a small business credit card also makes tracking simpler with consistent monthly statements. Limits up to $100k get extended based on personal credit history and annual revenues. Have your EIN, contact details, and financial statements ready to complete the application.
Before selling your first bottle, proper permissions must be obtained legally and safely operate. Find federal license information through the U.S. Small Business Administration . The SBA also offers a local search tool for state and city requirements.
Securing water rights represents the first hurdle but opens access to your primary raw material. Water rights permits apply whether bottling from freshwater springs or drilling wells. Fees vary but licensing confirms approved extraction volumes that regulators monitor to prevent aquifer depletion.
Relatedly, wetlands protections may mandate permits for pipelines traversing protected ecosystems near water access points. Wildlife impact studies and seasonal construction restrictions often apply. Allow 6-9 months for approval.
Food manufacturing permits from departments of health follow since bottled water gets classified as a food product. Annual inspections governed by strict codes for sanitation, purification standards, and production procedures ensure facilities meet GMP benchmarks. Violations risk suspended production and sales.
HACCP compliance takes safety further through hazard prevention plans that systematically mitigate risks like contamination. Develop thorough protocols then prove consistency through compliance audits. Achieving certification takes time but boosts retailer confidence.
Trademark registrations provide legal protections around branding assets like custom bottle packaging and labels that define companies. Register marks used in commerce with state and federal trademark offices. The process takes 6-9 months from application to certificate issuance but then lasts for years once granted. This guards against competitors mimicking your visual identity.
Evaluate zoning regulations when selecting bottling plant locations and warehouse space. Industrial activity permits may be required depending on protocols for chemical storage, noise, waste disposal, and utility demands. Build rapport with local officials early when identifying potential issues.
The path towards legally bottling and selling products has obstacles, from source licensing to safety codes across planning, facilities, and output. However due diligence in researching requirements, hiring specialized lawyers, and allotting sufficient lead time checks the right boxes for approval.
Operating a bottled water business carries an array of risks that insurance helps mitigate, from minor equipment failures to catastrophic natural disasters. Policies shield owners against expenses that could otherwise cripple companies or trigger bankruptcy.
Imagine a production line bottleneck that delays a 50,000-unit order, forcing reimbursements to a major retailer. Or a storm flooding your warehouse with thousands of pallets destroyed. Even a visitor slipping on a wet floor could trigger a lawsuit exceeding $100k. Lacking proper coverage, these frequent mishaps could force closures.
General liability insurance protects against bodily injury, property damage, and associated legal claims by those harmed while on-premises or using products. Plans like Business Owner’s Policies (BOPs) bundle general liability with property/casualty coverage plus business interruption insurance to replace income lost from disasters.
Separate policies may cover vehicles, expensive equipment, or specialized risks like product recall expenses if contamination issues arise. Work with an independent insurance agent to review needs and obtain quotes. Expect reasonable plans to run a few thousand dollars annually.
The process begins by inventorying assets and ranking risk exposures. Provide details on properties, vehicles, equipment, staff, and revenue when getting quotes. Inquire about Renaissance Insurance programs for niche ventures. Then select a policy aligning with your risk appetite and premium budget. Pay annually or break payments into installable premiums.
An office provides a professional hub for bottled water operations – hosting meetings with suppliers, interfacing with quality inspectors, and signing major account contracts. It also houses equipment like printers and offers room for admin work. We’ll analyze options based on cost and functionality.
Utilizing a home office makes sense initially through converting a spare bedroom for minimal expenditure – perhaps $100 for a desk and chair plus wifi and utilities. Meetings can occur but lack scale for more than 2-3 people. Still, this allows bootstrapping during early growth stages while establishing operations.
For client presentations or investor pitches, coworking spaces like WeWork provide sleek meeting rooms with presentation tools for $25-50 per hour depending on extras like video conferencing needs. Some offer private offices starting around $300 monthly with flexible terms. No hassles over the internet, printing, or coffee either.
Seeking larger production facilities or warehouse spaces may include build-to-suit office additions averaging $100 per square foot for simple construction. Budget at least $3,000 for a basic 30′ x 20′ space. These integrate operations but don’t facilitate meetings with external parties.
Over the longer term as staff expands, dedicating $2,000+/month for a traditional 800 sq ft office rental provides requisite space for 4-5 employees, storage needs, and conference rooms to host clients, inspectors, and partners. Expect interpreting services and administrative assistance included along with furnishings, internet, and janitorial with 3-5 year leasing contracts.
Launching bottling operations requires production machinery for purification, washing, filling, and packaging. Buying new or used provides ownership, while rental and leases offer flexibility. We’ll explore options to access essential equipment.
Purchasing brand-new automated bottling equipment from manufacturers like Specialty Equipment enables customizing multi-stage systems from filtration to label applications tailored to output targets. Expect prices from $75,000 to $150,000+ for complete lines. Finance through equipment leasing if cash-strapped.
Buying used machinery cuts costs by 30-50% while still getting solid equipment. Vet condition, servicing records, and output rates when evaluating listings around $50,000. Factor in some reconditioning costs too.
Instead of buying equipment, leasing through an equipment finance company gains usage without major capital investments. These loans cover 80% at fixed monthly payments structured around project revenue timelines. Tax write-offs apply as with purchases.
Long-term leases spanning several years provide more flexible terms over rentals if planning to scale production substantially. The lessor assumes maintenance responsibility too. Expect roughly $5,000 monthly for a complete system.
Crafting a distinct brand identity sets bottled water ventures apart while conveying purity and quality promises. Professional branding assets prompt consumer awareness and preference to drive sales.
Getting a unique business phone number using providers like RingCentral shows commitment beyond personal mobiles. Expect a local or toll-free number with call routing features like voicemail transcription for $30-50 monthly. This grants credibility when contacting suppliers, clients, and property managers.
A polished logo acts as the lead brand ambassador applied to all touchpoints. Consider an abstract mark evoking droplets or a memorable illustrative icon to reference fresh springs. Brand system extensions like stationery, uniforms, and fleet branding create cohesion.
Services like Looka assist by providing full branding packages including a logo with alternate versions, a brand guide, social media assets, website graphics, and business card design from $149. This turnkey solution expedites the launch.
Ensuring sales reps and executives have professionally printed cards from Vistaprint lends further validation when meeting buyers, networking at trade events, or negotiating with vendors. Include essential contact and web details along with a descriptor like “Purveyors of Natural Spring Water”.
Secure the business name as a .com domain for branding continuity and an online destination. Use .com over alternatives like .biz and include keywords like “water”. Namecheap runs under $15 annually for domains. Redirect it to a coming soon page until a full website launches.
Building that dedicated website as an online brochure explains the brand story, showcases products, and profiles company values. Utilize templates from Wix to DIY for $20-40 monthly. Or hire web developers on Fiverr to custom craft sites from $500. This digital footprint supports 24/7 sales enablement.
Tapping into local networks multiplies opportunities through camaraderie, elevated expertise, and partnerships. We’ll explore helpful associations, events, and online groups to enrich startups.
Joining a local chapter of the International Bottled Water Association (IBWA) guides safety regulations plus advocacy for the industry. Annual memberships start under $500. The Pennsylvania Bottled Water Association runs around $350 per year for in-state connectivity.
Attend trade events like the Bottled Water Expo allowing networking with major equipment vendors and fellow bottlers. This fuels innovation through witnessing cutting-edge machinery first-hand while building strategic relationships. Use Meetup to find similar regional events.
Facebook communities like Water Bottle Wholesale Buy or Sell provide forums to crowdsource advice on production techniques, quality assurance, equipment questions, and regulator relations from thousands nationally. Trusted answers result.
Implementing an integrated marketing strategy combines digital promotion and real-world outreach to exponentially expand bottled water visibility and sales. We’ll explore proven tactics to connect with more customers.
Recognize existing friends and family as initial brand ambassadors to organically spread awareness through interactions and referrals. Incentivize sharing by providing discounts for referring new accounts that convert to loyal buyers.
For ongoing nurturing, launch a YouTube channel creating weekly content like quick recipes or reuse crafts using empties. Optimized video titles can rank highly in Search results. Encourage subscriber sign-ups.
Traditional tactics still prove worthwhile:
An integrated methodology blending digital and real-world marketing sustains awareness and interest while optimizing budget efficiency. Analyze campaign performance to double down on what moves the needle most. Through multi-channel outreach, even tiny brands can make big ripples.
Providing exceptional customer service cements bottled water loyalty even amid commodity competition. Experiences determine repurchasing and referrals, directly driving growth.
For delivery accounts like offices, ensure consistency through prompt arrivals within precise time windows to avoid work disruptions. Also follow up post-delivery to address spills, leakage issues, or mismatches between orders and receipts. These service touches feel personal despite routine transactions.
Likewise, for hospitality and events clients, customized branded water bottles make promotional activations feel special. Accommodating last-minute catering increases or flexible minimums wins you preferential vendor status. Consider also that you can sell your products to vending machine businesses or stores that utilize these machines to increase sales.
For individuals, promotional giveaways like reusable bottles help, but personal notes or birthday coupon mailers make bigger impressions with minimal effort.
Getting the product right earns business, but getting the service right gains loyalty even despite higher prices. This emotional equity triggers referrals – a satisfied gym owner raving about your flexibility prompts a restaurant owner to trial your services.
Bland brands risk commoditization where choice gets dictated by case price alone. But those providing memorable customer experiences create preferences worth paying more for. A premium for personalized service produces higher lifetime values.
Keep communicating, learn client priorities, correct issues quickly, and sprinkle in surprises to delight. Water may be simple, but customer service leaves lasting impressions that better-bottled water businesses bank on.
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How to start a dog clothing business in 14 steps (in-depth guide), how to start a vintage clothing business in 14 steps (in-depth guide), how to start a bamboo clothing business in 14 steps (in-depth guide), how to start a garage cleaning business in 14 steps (in-depth guide).
Main Sections In This Post Steps To Starting A Bottled Water Business Points to Consider Resources Knowledge Is Power Featured Video
This article provides a comprehensive guide to starting and running a bottled water business.
It includes a detailed step-by-step roadmap and valuable resources for the startup phase and ongoing operations. Save this page for future reference, and feel free to share it with others interested in the industry.
Let’s get started with the steps.
Below are the steps to starting a bottled water business.
Each step is linked to a specific section, allowing you to jump to your desired section or scroll to follow the steps in order.
Is Starting a Bottled Water Business the Right Step for You?
Discovering Your Passion
A key factor holds the key to success in the business world – and that factor is you! Your drive and passion are pivotal in determining the path to triumph.
Passion: The Fuel for Success
Passion is an accessory and a vital ingredient in your entrepreneurial journey.
Challenges become opportunities for creative solutions when your heart is passionate about your bottled water business.
Conversely, lacking passion may lead you to seek an escape route rather than face obstacles head-on.
Unveiling Your Entrepreneurial Zeal
How fervent is your desire to own and manage a business? Let’s explore an intriguing perspective:
Imagine a life free from restrictions and abundant financial resources that can sustain you indefinitely. In this scenario, your choices are boundless, unaffected by monetary considerations.
The Decisive Question
Would you choose to venture into the bottled water industry in this context? If your answer is a resounding yes, it reveals your passion for this enterprise and signifies that you are on the right path.
Exploring Alternative Paths
However, if your answer leans towards a negative response, it beckons another question: What alternative path captures your preferences and aspirations? Perhaps it’s worth considering pursuing that path instead.
The Heart of the Matter
In conclusion, the essence of success lies in your passion for the business you undertake. Embrace your passion, and let it guide you towards a fulfilling and prosperous bottled water venture.
For More, See How Passion Affects Your Business . Also, see, Considerations Before You Start Your Business to identify key points for a new business owner.
Next, let’s spend some time on key issues to give you an overview of what to expect from owning and running your business.
Understanding the Bottled Water Business
A bottled water business revolves around providing a vital necessity – water. This enterprise involves sourcing, bottling, and distributing water to various customer bases, from grocery stores and convenience stores to offices and direct residential customers.
The daily operations for such a business are multifaceted. They include tasks such as quality assurance of the water, overseeing the bottling process, coordinating logistics for distribution, handling customer inquiries and orders, and performing administrative tasks, among others.
Keys to Success in a Bottled Water Business
Establishing a Loyal Customer Base
Building a solid customer base is essential for the longevity of the business.
This can be achieved through effective marketing strategies, superior products, and exceptional customer service. Additionally, engaging with customers to understand their preferences can help tailor your products to meet their needs.
Effective Staff Management
The smooth operation of a bottled water business largely relies on its staff, from those involved in sourcing and bottling water to those managing logistics and customer service.
Proper staff management includes training, motivation, and a conducive work environment.
Managing Cash Flow
Cash flow management is crucial in running any business, including a bottled water business.
It involves tracking all transactions, ensuring that income covers expenses, planning for future expenses, and maintaining an emergency fund.
Cost Management
Maintaining quality and customer service while minimizing costs is crucial for profitability.
This can be achieved by streamlining operations, investing in efficient equipment, and implementing cost-saving strategies without compromising product quality or customer service.
Adaptability to Change
The business landscape continually evolves with industry trends, business processes, or technology changes. Staying up-to-date on these changes and adapting your business operations is crucial for long-term success.
Revenue Fluctuations
Revenue in a bottled water business can fluctuate due to various factors, such as seasonal changes or market trends.
Proper planning and strategies can help manage these fluctuations.
Competitor Management
Dealing with competitors requires a solid understanding of the market, keeping track of competitor activities, and devising strategies to differentiate your products and services.
Meeting Customer Expectations
Meeting and exceeding customer expectations are integral to a bottled water business.
This involves offering high-quality water, providing excellent customer service, and ensuring timely delivery.
Regular customer feedback is an excellent way to understand their expectations and make necessary improvements.
With this customer-focused approach, your bottled water business can thrive and become a trusted provider in the industry.
Types of Bottled Water Business Setups and Their Business Models
Local Bottling Operations
These businesses source water locally, treat and bottle it, then distribute it within a particular region or community.
This model often operates on a small scale, emphasizing the local origin and quality of the water. The focus may be on home and office delivery, local retailers, or both.
Large-Scale Bottling Operations
These companies function on a national or even international scale. They source, treat, and bottle water in large quantities, distributing their products across wide geographic areas.
Products are typically sold through various retail outlets, including supermarkets, convenience stores, and online marketplaces.
Private Label Bottling
In this model, a company bottles water to be branded and sold by another business.
Large retailers or brands often use this setup to offer branded bottled water without investing in sourcing and bottling infrastructure.
Office and Home Delivery Services
These businesses specialize in delivering bottled water directly to homes and offices.
They may either bottle their water or distribute products from other manufacturers. This model emphasizes convenience and regular, recurring sales to a set customer base.
Franchise Bottled Water Business
This involves buying into an established bottled water brand and operating a branch of the business under the brand’s umbrella.
In this case, the franchisor sets the business model, often including established supply chains, brand recognition, and ongoing franchisor support.
Custom Bottle Design and Packaging
These businesses focus less on the water and more on unique bottle design and packaging.
This could include personalized labels for corporate events, weddings, or promotional activities. In this model, the emphasis is on added value through design and customization rather than the water product itself.
In conclusion, identifying a profitable and high-demand niche for your bottled water business from the beginning is essential.
Carefully consider each business model and choose one that aligns with your resources, interests, and the market’s needs.
Switching your model later can be more challenging so a thoughtful initial decision can set the stage for long-term success.
Unique Branding
Create a unique and memorable brand to distinguish your bottled water business from competitors.
This could involve an eye-catching logo, a strong brand story, or a distinct voice that resonates with your target market.
High-Quality Product
By prioritizing the quality of your water — through rigorous purification processes, stringent quality checks, and certified sourcing — you can gain a reputation for excellence that sets you apart.
Exceptional Customer Service
Providing outstanding customer service can make your business stand out. This can include prompt deliveries, professional responses to inquiries and complaints, and friendly service at all touchpoints.
Sustainable Practices
With increasing awareness of environmental issues, adopting sustainable practices can differentiate your brand. This can range from eco-friendly packaging to responsible water-sourcing practices.
Community Involvement
Involvement in local community events, charitable causes, or sponsorships can help your bottled water business gain visibility and a positive reputation.
Complementary Products
Offering additional products that complement bottled water can enhance your business’s appeal. This could include healthy snacks, reusable water bottles, water dispensers, or water purification systems.
Subscription Service
Consider a subscription model where customers receive regular water deliveries. This offers convenience for the customer and predictable recurring revenue for your business.
Custom Labeling
Provide custom labeling services for businesses or events. This allows companies to have their logo on bottles or individuals to personalize bottles for special occasions.
Bulk Discount Offers
Discounts for large purchases can attract larger clients, such as corporate offices or event organizers, to choose your services.
e.) Questions for Your Bottled Water Business
Bottled Water Business Model
Have you decided on a specific business model for your bottled water operation? Are you considering local bottling, large-scale operations, private-label bottling, or a franchise?
Workforce Management
Do you plan to take on all business responsibilities, or do you intend to hire employees? What roles will be needed if hiring, and how will you find suitable candidates?
Management Considerations
Will you personally oversee your bottled water business, or do you plan to employ a manager to handle daily operations?
Partnerships and Investments
Are you considering bringing in business partners or seeking external investors? If so, how will you identify and approach potential collaborators?
Business Location
Do you intend to run your bottled water operation from a home office, or do you plan to operate from a commercial location? If choosing a commercial location, what factors will guide your site selection?
Operating Format
Are you considering a physical setup, like a brick-and-mortar store, or do you plan to operate mainly online? If considering an online operation, how will you handle logistics and distribution?
Future Growth
Have you given thought to your business growth strategy? What are your long-term goals for your bottled water business? How do you plan to scale up operations when the time is right?
Regulatory Compliance
Have you researched the regulations and compliance requirements for running a bottled water business in your region? How will you ensure ongoing compliance?
Market Analysis
Do you understand your target market and your competition? Have you done market research to guide your branding, marketing, and pricing decisions?
Financial Planning
Have you drawn up a detailed business plan, including financial projections? Do you clearly understand your startup costs, operating costs, and potential revenue?
Answering these questions will prepare you for the many facets of running a bottled water business and set you on the path to success.
The Benefits of Running a Bottled Water Business
Independence
Owning a bottled water business allows you to be your own boss. You can call the shots and run the business according to your vision.
Creative Freedom
You can be innovative with your products, branding, marketing, and overall business approach. This creative freedom can make the business more fulfilling.
Potential for High Revenue
Given the universal demand for clean water, a successful bottled water business can generate substantial income.
Flexible Work Hours
Once the business is successful and you have a competent team, you may have the flexibility to set your work hours.
Control Over Working Environment
As a business owner, you can create a working environment that aligns with your values and enhances productivity.
Contribution to Health and Wellbeing
The bottled water business contributes to the health and well-being of customers by providing clean, safe water, adding a sense of purpose to your enterprise.
The Challenges of Running a Bottled Water Business
Responsibility for Problems
As the owner, you shoulder the responsibility for any problems or challenges that arise in the business.
Irregular Income
You may not have a steady income, particularly during the start-up phase or during periods of fluctuation in the business.
Challenging Start-Up Phase
Getting the business off the ground can be difficult, with many simultaneous decisions and tasks.
Customer Acquisition and Retention
Gaining and keeping customers in a competitive market can be a significant challenge.
Extra Working Hours
You may have to work long hours during certain stages, which could affect your work-life balance.
Pressure to Succeed
Running a business comes with the pressure to succeed, which can be stressful.
Significant Initial Investment
Starting a bottled water business often requires a substantial financial investment for equipment, premises, and other startup costs.
Constant Change
In business, change is inevitable, whether it’s market trends, customer preferences, or industry regulations. Adapting to these changes can be challenging.
Business Risks
Running a bottled water business, like any business, carries risks. These could range from financial losses and regulatory issues to market competition and unforeseen circumstances like natural disasters.
Quality Control Challenges
Ensuring consistent water quality can be challenging but is essential for the reputation and success of the business.
In conclusion, owning and running a bottled water business has rewards and challenges.
Careful planning, diligent management, and a willingness to adapt can help you navigate these factors for a successful enterprise.
For more, see Pros and Cons of Starting a Small Business.
Bottled Water Business Research
Laying the Foundation: Informed Decision-Making
Before diving into any business endeavor, conducting comprehensive research is paramount.
Equipping yourself with quality information is vital to understanding the industry’s difficulties, lest you find yourself caught off guard.
Seeking Wisdom: Learning from the Experts
One valuable avenue to acquire the best insights is tapping into the knowledge of seasoned individuals in the bottled water business.
These industry experts are qualified to provide reliable information, becoming a valuable resource for your research.
Unveiling Priceless Wisdom: An Opportunity for Growth
Interacting with experienced professionals offers an invaluable opportunity to glean insights and wisdom from their years of knowledge and expertise.
The time spent with them can prove invaluable in shaping your understanding and decision-making process.
Unlocking the Path: A Guide to Reaching Out
To assist you in connecting with the right individuals and approaching them respectfully and non-threateningly, I have crafted an article brimming with ideas and strategies.
While the complete steps extend beyond this post, I strongly urge you to read the article by following the link below.
It will provide you with a comprehensive understanding of what lies ahead in your bottled water business journey.
See An Inside Look Into the Business You Want To Start for all the details.
Understanding your target audience in the bottled water business is crucial for reaping various benefits.
Knowing your target market allows you to tailor your offers to appeal to customers’ preferences, ensuring they find your products and services enticing.
Moreover, understanding your audience allows you to provide offerings that align with their interests, further enhancing customer satisfaction.
Target Market Ideas:
For more, see How To Understand Your Target Market.
Startup Costs:
Accurate Estimation for a Smooth Launch
To ensure a smooth and successful launch of your bottled water business, it is essential to gain an overview of the startup costs involved.
Accurate estimation plays a pivotal role, as underestimating can lead to financial shortfalls that hinder your business opening, while overestimating can make your venture appear risky.
The size of your operation, chosen location, employment decisions, equipment purchases, and rental agreements all impact your costs.
For more detailed information, refer to my article on Estimating Startup Costs.
Comprehensive List and Research
Compile a comprehensive list of necessary items for your startup. Then, diligently research the prices associated with each item.
Be thorough in your investigation, as you may encounter additional expenses during your research phase.
This comprehensive estimation will ensure a more accurate assessment of your startup costs.
Sales and Profit:
Key Factors for Success
The success of your bottled water business relies on several factors when it comes to sales and profitability.
These factors include the popularity and demand for your products and services and the effectiveness of your marketing strategies in reaching the right target audience.
Beyond Sales: Consideration of Expenses
When assessing profitability, it is essential to consider the profit per sale and various expenses that impact your bottom line.
This includes rent, payroll, and other overhead costs associated with running your business.
Achieving Financial Success
To achieve financial success, your monthly sales must cover your expenses and provide sufficient profit to sustain your business.
Additionally, it is important to ensure that your sales generate enough revenue to cover your monthly expenses and allow for salary payments, ensuring the long-term viability of your bottled water business.
For More, See Estimating Profitability and Revenue
Sample Financial Lists As a Starting Point
Sample Financial Lists for Your Bottled Water Business
Below are three sample financial lists designed to give you a general idea of the expenses and revenues you might expect when starting and running a bottled water production business in the USA.
Sample Startup Costs for a Bottled Water Business
Total Estimated Startup Costs: $84,500
Sample Monthly Expenses for a Bottled Water Business
Total Estimated Monthly Expenses: $11,000
Sample Sales and Profit Breakdown
Assuming a sales price of $1 per bottle ( premium branded ), selling 20,000 bottles per month:
Estimated Monthly Profit: $9,000
Remember, these figures are fictional examples that provide a broad sense of the financial aspects of running a bottled water business.
Adjusting these costs and revenue projections can significantly affect the success of your business.
A small shift in profit per bottle sold can make a huge difference when dealing with high-volume sales.
Also, remember that many new businesses take time to become profitable as they build a customer base, establish a reputation, and optimize operations.
Your specific costs, expenses, and profits will vary based on numerous factors.
It’s essential to do thorough research and consider seeking professional advice when calculating your business’s startup costs, ongoing expenses, and potential revenues and profits.
The Significance of Location for a Bottled Water Business
Choosing the right location for your bottled water business can determine its success or failure.
Demand and Competition Considerations
Operating in an area without product demand will inevitably lead to failure even before your business takes off. Conversely, setting up in an area saturated with competition can make it challenging to gain market share.
Balancing Demand, Competition, and Affordability
Ideally, you should aim for a location that strikes a balance between having sufficient demand for your bottled water products and facing an acceptable level of competition.
Additionally, affordability is a crucial aspect to consider. While operating in a highly populated area can offer more exposure, you must ensure that the extra expenses associated with it do not outweigh the potential profitability.
Exploring Different Options
Consider operating your business from home, especially if your model is primarily online or does not require extensive personal customer interaction.
Starting from home can be a cost-effective option initially, and as your business expands, you can evaluate the need to transition to a commercial location.
Thorough Research and Careful Evaluation
Choosing the right location is critical to achieving success for your bottled water business.
Conduct thorough research, analyze the local market, and evaluate demand, competition, and affordability.
It is essential to approach this decision carefully and gather all the necessary information to make an informed choice.
For more about business locations, see Choosing The Best Location for Your Business.
A mission statement is a valuable tool for identifying the core purpose of your bottled water business.
It serves as a guiding principle to keep you focused and reminds you of the main benefit you aim to provide to your customers and community.
Examples of Mission Statements for a Bottled Water Business:
Note : These are fictional examples meant to illustrate the essence of mission statements for a bottled water business.
A real mission statement should be crafted to align with your business’s specific values and goals.
For more, see, How To Create a Mission Statement
A Unique Selling Proposition (USP) plays a crucial role in identifying and creating a distinct offering that sets your bottled water business apart from competitors.
Examples of Unique Selling Propositions for a Bottled Water Business:
Note: These are fictional examples intended to demonstrate the concept of a Unique Selling Proposition for a bottled water business.
Developing a USP that aligns with your specific business goals, target market, and competitive landscape is important.
When selecting a name for your bottled water business, it’s crucial to aim for something captivating and fitting.
Opt for an easily pronounceable and memorable name, as it will likely remain with your company for the long term. Additionally, securing a matching domain name for your online presence is essential.
Conduct thorough research to ensure another business does not already register the desired name.
Here are 30 creative ideas to inspire your original bottled water business name:
Remember, these are just ideas to spark your creativity and assist in developing an original business name for your bottled water venture.
Ensure the chosen name aligns with your brand identity and resonates with your target audience.
Conduct proper research and consider consulting professionals to ensure legal availability and trademark considerations for your business name.
For more, see the following articles:
Ensuring Your Bottled Water Business is Legal
Operating a legal business is essential for compliance, protection, and overall success. Here are key points to consider:
Seek Professional Guidance: Consulting with legal and tax professionals is crucial to ensure compliance with laws and regulations. They can also assist in determining the best business setup for tax benefits and liability protection.
Common Types of Registrations: When starting a bottled water business, you may need to consider various registrations, including:
Permits and Licenses: As a bottled water business, you may need to obtain specific permits and licenses to ensure compliance and consumer safety. Some examples include:
Compliance with Regulations: Ensure adherence to industry-specific regulations such as the FDA’s Current Good Manufacturing Practices (cGMP) for bottled water production and labeling requirements.
Remember, laws and requirements may vary based on location, so consulting with professionals familiar with the bottled water industry and local regulations is crucial.
Complying with legal obligations helps protect your business, ensures consumer trust, and positions you for long-term success.
Registration:
Business Structures:
Corporate Identity for a Bottled Water Business
Establishing Your Brand’s Visual Presence
A Corporate Identity (Corporate ID) plays a vital role in representing your bottled water business.
It encompasses elements that establish your brand’s visual presence, including your logo, business cards, website, business sign, stationery, and promotional items.
Consistency and Professionalism
Maintaining a consistent and professional design across these components is essential to leave a lasting impression on new and existing customers.
A strong and cohesive corporate identity conveys professionalism and helps build brand recognition and trust.
Logo Design: Capturing Your Brand Essence
As a key component of your corporate identity, your logo should capture the essence of your bottled water business.
It should reflect your brand’s values, evoke a sense of quality and purity, and resonate with your target audience.
Branded Materials: Showcasing Your Unique Qualities
From business cards to promotional items, each element of your corporate identity should showcase your brand’s unique qualities.
Whether it’s the design of your water bottle labels, the layout of your website, or the appearance of your business signage, consistency and attention to detail are crucial.
Impressing Customers: A Commitment to Excellence
A well-designed corporate identity demonstrates your commitment to excellence and professionalism. It helps create a positive and memorable impression on customers, fostering brand loyalty and encouraging repeat business.
Remember, a strong corporate identity is an investment in building your brand’s reputation and standing out in the competitive bottled water industry.
Seek professional design services or consult branding experts to ensure your corporate identity aligns with your brand values and effectively represents your business.
You can see our page for an overview of your logo , business cards , website , and business sign , or see A Complete Introduction to Corporate Identity Packages.
The Importance of a Business Plan for a Bottled Water Business
A business plan is a critical document for a bottled water business. It serves multiple purposes, such as acquiring funding and attracting investors.
Moreover, it acts as a roadmap to keep you on track during the startup phase and while your business is in full operation.
Crafting a Vision for Success
Writing a business plan requires time and effort as it involves creating a vision of what your bottled water business will be like once it’s operational.
Careful planning and thoughtful consideration of details are necessary to articulate your vision effectively.
Clarity and Guidance
Completing a well-crafted business plan is worthwhile because it clearly explains what is needed to start and operate your business successfully.
It serves as a guide to help you navigate the challenges and make informed decisions.
Choosing the Right Approach
When creating your business plan, you have various options available. You can start from scratch, enlist the services of a professional, utilize a template, or leverage business plan software.
Regardless of the chosen approach, active participation is essential to ensure your plan is distinctive and effectively communicates the nature of your bottled water business and management strategies.
Adapting and Optimizing
Recognizing that your business plan can evolve and be optimized as you gain experience and insights is important.
Periodically reviewing the document and making necessary adjustments to reflect changes in your business or operations is advisable.
Remember, a well-crafted and adaptable business plan is a valuable tool that can contribute to the success of your bottled water business.
A Fictitious Business Plan Example for a Bottled Water
PureSprings Bottled Water Business Plan
Executive Summary
PureSprings will offer high-quality, naturally sourced bottled water. Based in a region with abundant natural springs, we are uniquely positioned to cater to the demands of health-conscious consumers.
Company Description
PureSprings is a startup set to operate from a moderate-size bottling plant. We focus on sustainability, drawing water from local springs and packaging it in eco-friendly bottles.
Our target market comprises individuals and businesses seeking quality bottled water. With the continuous growth in the bottled water market, we anticipate steady demand for our products.
Organization and Management
PureSprings’ team will be spearheaded by the founder and CEO. Other team members will include a Production Manager, Marketing and Sales Manager, and an Accounting Manager.
Product Line and Services
Our product line includes natural spring water packaged in various sizes to meet consumer needs. Over time, we may introduce flavored water options.
Marketing and Sales Strategy
We’ll focus on marketing the health and sustainability aspects of our products. Our strategy will involve direct sales and partnerships with local and national retail stores.
Funding Request
We’re seeking an investment of $84,500, projected as the startup cost, to cover equipment purchase, water rights procurement, and initial marketing.
Financial Projections
In the first month, we anticipate selling 20,000 bottles, which gives us monthly revenue of $20,000. With estimated monthly expenses of around $11,000, we project a monthly profit of $9,000.
Exit Strategy
Once PureSprings achieves sustainable growth, we may explore franchising, expansion into new regions, or a potential acquisition by a larger beverage company.
Remember that this is a hypothetical business plan, and the figures are illustrative. Real-world business plans should be based on comprehensive market research and professional financial advice.
For information on creating your business plan, see, How to Write a Business Plan.
Consider selecting a local bank that specializes in serving bottled water business owners.
Opening a dedicated business account clearly separates your business expenses and personal spending.
This separation simplifies expense tracking, facilitates efficient bookkeeping, and provides documentation in the event of a tax audit.
Establishing a professional relationship with your banker is beneficial. They can offer valuable advice and financial services and expedite application processes.
Additionally, explore applying for a merchant account or similar setup to accept credit and debit card payments. This enables convenient payment options for your customers, enhancing their satisfaction and boosting sales.
Remember, choosing a bank that understands the specific needs of your bottled water business can streamline your financial operations and contribute to the overall success of your venture.
Research and compare banking options, seek recommendations from fellow business owners and consider the level of personalized service and relevant financial solutions when making your decision.
For more, see, How to Open a Business Bank Account. You may also want to look at, What Is a Merchant Account and How to Get One.
Getting Funding for Your Bottled Water Business
If you need financial support to start and operate your bottled water business, there are various funding options available. Here are some key considerations and tips to help you navigate the process:
Secure funding for your bottled water business requires thorough preparation, a well-crafted business plan, and effective communication of your vision and potential.
Research your options, seek professional advice, and diligently compile the necessary documents to increase your chances of obtaining the funds to launch and grow your business successfully.
See, Getting a Small Business Loan for more.
Software Considerations for Your Bottled Water Business
Selecting the right software is crucial for efficient operations when setting up your bottled water business.
Here are some key points to consider:
1. Research Software Options
Thoroughly research the available software solutions. Implementing a program from scratch is often easier than switching to a new system after your data is already in another program.
2. Demo, Reviews, and Forums
Look for software providers that offer demos or trials. This allows you to evaluate the software’s features and user-friendliness.
Additionally, explore reviews and forums to gather insights from other user’s experiences with the software.
3. Expense Tracking and Financial Document Preparation
Consider software options that track expenses and prepare financial documents for tax filing.
Consulting with your bookkeeper or accountant can provide valuable guidance in choosing the right accounting software that aligns with your business needs.
Software Options to Consider for Your Bottled Water Business:
Remember to evaluate each software option based on its suitability for your business requirements, scalability, user-friendliness, and compatibility with existing systems.
Consider seeking recommendations from industry peers and consulting software providers for customized solutions tailored to your bottled water business.
Software Considerations for a Bottled Water Business.
Check out Google’s latest search results for software packages for a bottled water business.
Insurance Considerations for Your Bottled Water Business
Incidents can occur unexpectedly, making having the right insurance coverage essential before any activities occur at your bottled water business. Here are key considerations to keep in mind:
1. Comprehensive Coverage
Consider insurance policies that provide comprehensive coverage to protect various aspects of your business, including:
2. Professional Liability Insurance
Consider obtaining professional liability insurance, also known as errors and omissions insurance. This coverage protects you against potential lawsuits resulting from errors, negligence, or professional misconduct.
3. Home-based Business Insurance
If you plan to operate or manage your bottled water business from your home, inform your home insurance agent. Operating a business from home may impact your existing home insurance policy, and you may need additional coverage.
4. Consult an Insurance Broker
Working with a competent insurance broker is advisable to navigate the complexities of insurance and ensure you have sufficient coverage.
They can guide you in understanding your risks, selecting appropriate policies, and obtaining competitive rates.
Concerns When Seeking Insurance for a Bottled Water Business:
Remember, securing the right insurance coverage is vital to safeguarding your bottled water business.
Assess your specific risks, consult with insurance professionals, and review policies carefully to ensure comprehensive protection against potential losses.
For more, see What to Know About Business Insurance . You can also browse the latest Google search results for bottled water business insurance .
Selecting Suppliers for Your Bottled Water Business
Developing strong relationships with reliable suppliers is crucial for the success of your bottled water business. Consider the following factors when selecting suppliers:
1. Reliability and Trustworthiness
Choose suppliers who are dependable and trustworthy. They should consistently deliver high-quality products and meet agreed-upon deadlines to ensure smooth operations.
2. Competitive Pricing
Look for suppliers who offer competitive prices. This lets you pass on cost savings to your customers, making your bottled water products more attractive and increasing your profit margin.
3. Stock Availability
Ensure your suppliers can consistently provide the necessary stock to meet the demands of your business. Prompt and reliable deliveries are essential to avoid any production or inventory management disruptions.
4. Respectful and Mutually Beneficial Relationships
Treat your suppliers with respect and fairness. Building a mutually beneficial relationship involves ensuring they also benefit financially.
This can foster long-term partnerships and open communication, leading to improved collaboration and shared success.
Remember, selecting the right suppliers is crucial for maintaining a reliable and efficient supply chain for your bottled water business.
Research and evaluate potential suppliers based on their reputation, product quality, pricing, and ability to meet your requirements.
Strong supplier relationships can contribute to your business’s overall growth and sustainability.
For More See, How To Choose a Supplier.
A bottled water business’s physical setup/layout is crucial for efficient operations. The layout should prioritize functionality and convenience, allowing for smooth workflow and easy access to equipment and storage areas.
Consider factors such as production space, storage capacity, labeling stations, quality control areas, and shipping logistics.
An optimized layout ensures streamlined processes, enhances productivity, and promotes a safe working environment.
Setting up appropriate signage is essential for a bottled water business. In addition to installing a prominent main business sign, it is important to place signs in relevant locations, including parking lots, exits, and special areas.
Well-designed signs play a crucial role in directing people, providing clear instructions, and enhancing the overall professionalism of your operation.
Effective signage helps customers navigate your premises easily and creates a positive impression of your business.
Office Setup:
Managing your bottled water business requires dedicated time in the office. An organized office setup is key to maximizing productivity.
Ensure your office has essential tools, including computers, printers, telephones, filing systems, and comfortable furniture.
Create an efficient workspace that allows for effective communication, easy access to important documents, and a comfortable environment for administrative tasks.
A well-equipped and organized office supports smooth business operations, facilitates efficient decision-making, and enables effective management of your bottled water business.
See, Here are Considerations for The Setup of Your Office, for tips and ideas to make your office work for you. Also, have a look at our article About Company Signs.
Having a website for your bottled water business offers numerous benefits. It is a powerful online presence, allowing customers to easily find and learn about your products and services.
A well-designed website showcases your brand, promotes credibility, and builds trust with potential customers. It provides a platform to showcase product information, pricing, and customer testimonials.
Additionally, a website enables online ordering and delivery options, expanding your customer reach.
It also facilitates effective communication, allowing customers to contact you directly, boosting customer engagement, and driving business growth in the digital landscape.
For more, see How to Build a Website for Your Business .
Building an External Support Team for Your Bottled Water Business
An external support team of professionals is a valuable resource for your bottled water business. These experts provide valuable advice and services without being on your payroll.
While some professionals may already be part of your network, it’s important to recognize their significance and consider expanding your team.
Engaging Professionals for Specific Needs
Depending on your specific needs, you can engage professionals per project, contractual, or hourly. This allows you to access their expertise without the need for full-time employment.
Consider professionals such as an accountant, a lawyer, a financial advisor, a marketing specialist, technical advisors, and consultants.
Building Professional Relationships
Building professional relationships takes time and effort. Continually work on expanding your network and nurturing these connections.
As your business grows, you can benefit from the support and expertise of your trusted external team.
The Benefits of a Strong Support Team
A strong external support team ensures you have access to the necessary expertise and guidance when needed.
These professionals can assist with financial matters, legal compliance, marketing strategies, and technical challenges.
You can confidently make informed decisions and navigate challenges by leveraging your knowledge and skills.
Remember, developing a strong support team is an ongoing process. Regularly assess your business needs and seek professionals who align with your goals and values.
Collaborating with trusted experts contributes to the success and growth of your bottled water business.
For more, see, Building a Team of Professional Advisors for Your Business.
Hiring Employees for Your Bottled Water Business
At the initial stages of operating your bottled water business, you may consider handling all tasks yourself to avoid the expense of hiring employees.
This approach can be manageable and cost-effective, especially during the startup phase.
However, as your business grows, you may find it challenging to handle all aspects of management and operations alone.
Hiring employees can greatly improve productivity and allow you to focus on strategic decision-making.
List of Job Positions for a Growing Bottled Water Business:
The following are job positions or outsourced services you may want to consider as your bottled water business grows and becomes successful:
Remember, as your bottled water business grows, the workload increases and specialized roles become necessary for smooth operations and continued success.
Evaluate your specific business needs and consider hiring employees or outsourcing services to support your expanding operations effectively.
For more, see, How and When to Hire a New Employee.
A List of Equipment and Supplies to Consider for a Bottled Water Business:
Equipment for a Bottled Water Business
This list gives a general idea of the equipment required for a bottled water business, but your specific needs may vary depending on your business model and local regulations.
Always do your research and seek professional advice if necessary.
Attracting Customers for Your Bottled Water Business
In the bottled water industry, customers are vital for the success of your business. Initially, it can be challenging to attract customers as your operation is new and awareness is limited.
Building a good reputation over time will make it easier to attract customers. With experience and a solid reputation, you can leverage your marketing efforts more effectively.
Marketing your bottled water business is an ongoing process that requires continuous investment. Consider it as a means to raise awareness and capture opportunities whenever they arise.
Investing in effective marketing techniques directly impacts your revenue generation. By implementing strategic marketing campaigns, you can reach your target audience, create brand awareness, and drive customer engagement.
Remember, effective marketing is essential to establish your presence in the market and attract customers to your bottled water business.
Continuously refine your marketing strategies, adapt to changing consumer needs, and seize opportunities to promote your products and services.
See our article How To Get Customers Through the Door
Building Business Partnerships for Your Bottled Water Business
Creating partnerships with other businesses can be a valuable strategy to attract new customers to your bottled water business.
Consider approaching the following businesses to explore collaboration opportunities:
When approaching potential partners, emphasize the mutual benefits of collaboration. Consider offering referral fees, co-marketing opportunities, or exclusive promotions to incentivize referrals and strengthen the partnership.
Building strategic partnerships can extend your reach and attract new customers to your bottled water business.
Seek out businesses whose clientele aligns with your target market, and explore creative ways to collaborate and foster mutually beneficial relationships.
Assessing Your Skills for Running a Bottled Water Business
Evaluating your skill set is important to determine if you have the necessary abilities to run a successful bottled water business. Recognizing your strengths and weaknesses allows you to focus on areas that require improvement or consideration for delegation. Remember, if you lack an essential skill, you can learn it or hire someone with expertise in that area.
Essential Skills for a Bottled Water Business Owner:
Remember, as a bottled water business owner, continuously developing and honing these essential skills will contribute to your business’s success and growth.
Seek opportunities for learning and improvement while considering delegating tasks where necessary.
Benefiting from Expert Tips to Enhance Your Skill Set
Exploring expert tips is invaluable for skill improvement, whether an expert or a novice.
You can discover more efficient approaches and gain fresh perspectives as an expert. As a novice, you can gather numerous tips to enhance your skills and expand your knowledge base.
See the latest search results for expert bottled water tips to gain tips and insights.
Valuable Resources for Your Bottled Water Business
In this section, you will find a compilation of resources that provide access to the latest and most relevant information in the bottled water industry.
These resources are beneficial during the startup phase and when your business is fully operational.
By utilizing these resources, you can gain a deeper understanding of the industry, stay updated on industry trends, and access valuable tips for enhancing your business practices.
They serve as a valuable knowledge base for your growth and success in the bottled water industry.
Gaining Insights from Industry Trends and Statistics in the Bottled Water Business
Examining industry trends and statistics offers valuable insights for a bottled water business. It provides a deeper understanding of market dynamics, consumer preferences, and emerging opportunities.
You can make informed decisions, adapt strategies, and position your business for success in a dynamic marketplace by staying informed.
See the latest search results for trends and statistics related to the bottled water industry.
Use a professional American writing style. Use simple words. Add Industry Keywords if Appropriate.
Write a neutral 40-word overview of
Trade associations offer numerous advantages, including staying informed about industry news and accessing networking opportunities. These benefits are particularly evident when associations organize events.
See the search results related to bottled water associations.
Drawing Inspiration from Established Bottled Water Businesses
Examining established bottled water businesses can spark ideas and insights to identify untapped opportunities within the industry.
It allows you to uncover unique offerings or identify areas for improvement in your business that may have been overlooked. Learning from successful businesses helps shape your own strategies and differentiate your brand.
See the latest search results for the top bottled water businesses.
Unveiling Future Opportunities: Researching the Future of the Bottled Water Industry
Researching the future of the bottled water industry offers significant benefits for aspiring business owners.
It allows you to gain insights into emerging trends, consumer demands, and technological advancements, enabling you to make informed decisions and position your business for long-term success.
See the search results for the future of the bottled water industry.
Gaining Price Insights: Researching Industry Prices for Starting a Bottled Water Business
Researching industry prices provides valuable benefits when launching a bottled water business.
It allows you to understand market pricing trends, determine competitive pricing strategies, and ensure your pricing is competitive while maintaining profitability.
This knowledge helps you make informed decisions and set appropriate product pricing.
See the latest bottled water prices.
Considering the Purchase of an Established Bottled Water Business
Exploring the option of buying an existing bottled water business offers both advantages and disadvantages.
The benefits of acquiring an established business include:
However, there are also potential disadvantages to consider:
Even if you don’t find an exact match for a bottled water business for sale, it’s worth exploring similar opportunities within the industry.
Researching available options can provide valuable insights and inform your decision-making process.
Businesses for sale: See the latest results for a bottled water business and others related to this business model.
Considering the Purchase of a Bottled Water Franchise
Exploring the option of buying a bottled water franchise offers both advantages and disadvantages. It’s important to carefully evaluate these factors before starting a business.
Additionally, while exploring franchise opportunities, you may discover related options in the bottled water industry that you hadn’t considered.
Even if you don’t find an exact match for a bottled water business franchise, you can explore franchise opportunities within the same industry using the provided link.
See the latest search results for franchise opportunities related to this industry.
Harnessing the Power of Knowledge for Your Bottled Water Business
Acquiring knowledge is a powerful tool when effectively utilized in your bottled water business. The internet offers a wealth of information about your industry.
Following the links in the following sections, you can access valuable resources to support your research, guide you through the startup phase, and enhance your business operations.
Stay informed, leverage the available information, and empower your journey to success in the bottled water industry.
Insights into the Day-to-Day Life of a Bottled Water Business Owner
Gain valuable tips and insights from industry professionals to understand what to expect in a typical day as a bottled water business owner. This resource provides an overview of the daily responsibilities and operations, offering practical guidance for success in the industry.
See the search results related to a day in the life of bottled water business owners.
Gaining Valuable Insights from Interviews with Bottled Water Industry Business Owners
Take the time to explore this section, where interviews with experienced business owners in the bottled water industry provide essential information and insights. Look into different perspectives to gain a deeper understanding of the industry and valuable insights into what to expect.
See the search results related to interviews of bottled water business owners.
Staying Informed with Publications in the Bottled Water Industry
Publications serve as a valuable resource to stay updated with the latest information about the bottled water business.
Explore these publications to access industry news, trends, insights, and best practices, ensuring you stay informed and ahead of the curve.
See the search results for Bottled Water publications.
Engaging in Bottled Water Forums for Industry Insights
Participating in bottled water forums allows one to join relevant discussions and connect with industry peers.
By actively engaging in these forums, you can foster relationships, gain customer perspectives, and gather valuable insights contributing to your business understanding and growth.
See the latest search results related to Bottled Water forums.
Enhancing Skills and Industry Knowledge through Bottled Water Production Courses
Enroll in courses related to bottled water production to enhance your skillset and stay updated with industry advancements.
These courses offer valuable learning opportunities to improve your capabilities and remain knowledgeable and current in the industry.
See the latest courses related to bottled water production and our management articles to provide insights and tips on managing Your business.
Gaining Insights and Industry Updates through Bottled Water Blogs
Subscribing to bottled water blogs offers a valuable source of ideas and industry updates.
By subscribing to multiple blogs and curating the ones that provide value, you create a collection of resources that deliver a constant flow of relevant information to support your business endeavors.
Look at the latest search results for bottled water production blogs to follow.
Staying Current with Bottled Water Industry News
Stay updated with the latest bottled water industry events by following industry news.
Set up alerts to receive notifications whenever new developments are covered by the media, ensuring you stay informed and well-informed.
Bottled Water News
Gaining Valuable Tips and Insights from Bottled Water Industry Videos
Explore videos about the bottled water industry to access helpful tips and insights.
Additionally, take advantage of related videos suggested by YouTube, as they often cover topics you may not have previously considered, expanding your knowledge and understanding.
See the links to YouTube Videos Below.
Starting a Water Refilling Station Business
For More Business Ideas, See our Collection of Business Ideas.
By: Author Tony Martins Ajaero
Home » Business ideas » Food Processing Industry » Water Refill Station
Do you want to start a water supply company and need to write a plan? If YES, here is a sample water supply business plan template & feasibility report .
Water is one of the commodities in our world that doesn’t have any substitute. If you want to take a bath; you use water. If you want to quench your thirst; you need water. If you want to fix a meal; you need water. The need for water could go on and on.
This points to the fact that clean water is as important as the air we breathe and it will continue to be in demand globally. The essence of going into any business is to solve a problem . Thus going into the water supply business would surely help you solve the challenges of people who don’t have access to clean water.
If you are certain that starting a water supply business is what you truly want to do after you must have conducted your market research and feasibility studies, then the next step to follow is to write a good business plan ; a detailed blueprint of how you intend raising your seed capital, setting up the business, managing the flow of the business, sorting out tax and marketing.
Here is a sample water supply business plan template that will help you to successfully write yours without stressing yourself.
1. industry overview.
Water is an essential commodity in all ramifications of life and as such the Public Health Department ensures that all water supply businesses meet certain health and safety standards. It’s important to note that if the water in a community is contaminated; it can result to epidemic in that community.
You will be required to obtain a license before you are permitted to drill a bore hole for your water supply business. This measure is guard against people drilling boreholes in places that are prone to earthquakes and tremors or places that have sanitary issues.
Your choice of location would be supervised and screened before you can be issued the permission to go ahead. Establishments in the water supply business sell water as a public utility to households, businesses and public entities throughout the united states.
Water supply businesses have performed well over the decade. Population growth, as well as occurrence of drought and other hostile weather conditions, have indeed increased demand for water supplied by industry operators .
Going forward, per capita water consumption is projected to decline, as increasing concerns regarding water conservation drive policy aimed at reducing consumption. Nonetheless, while per capita consumption rates are expected to depreciate, cumulative water consumption is projected to expand as the population and economy grow.
The Water Supply and Irrigation Systems industry is a thriving sector of the economy of the United States of America and they generate over $79 billion annually from more than 62,187 registered and licensed water supply and irrigation companies in the country.
The industry is responsible for the employment of over 244,122 people. Experts project the Water Supply and Irrigation Systems industry to grow at a 0.8 percent annual rate between 2013 and 2018. American Water Works Company Inc. has the lion share of the available market in the United States.
A recent report published by IBISWorld shows that the Water Supply and Irrigation Systems industry has performed well over the past five years.
Despite more efficient use of water, population growth, drought and other adverse weather conditions have increased demand for water supplied by industry operators. In addition, economic growth has expanded water demand from both downstream commercial and industrial customers.
Increased business activity has increased the amount of water demanded from retailers, restaurants and other commercial customers. Growth in manufacturing and other industrial activities, which often require copious amounts of water, have also increased demand for water.
The report further shows that over the past five years, the Water Supply & Irrigation Systems in the US industry has grown by 0.8 percent to reach revenue of $79bn in 2018. In the same timeframe, the number of businesses has grown by 1.5 percent and the number of employees has grown by 1.6 percent.
In summary, water supply business is a profitable industry and it is open for any aspiring entrepreneur to come in and establish his or her business; you can choose to start on a small scale servicing a community or you can choose to start on a large scale with several outlets in key cities in the United States of America.
Mark Warren® Water Supply, Inc. is a licensed water supply company that will be located in a residential area, 5 miles away from First Avenue – Cherry Creek, Denver, USA.
We have been able to secure a facility in a strategic location, with an option of long – term renewal on an agreed terms and conditions that are favorable to us. The facility has government approval for the kind of business we want to run and it is easily accessible.
We are in the water supply business to sale and supply treated water to residential apartment, offices, construction sites and industrial plants. We are also in business to make profits and at the same time to give our customers value for their money.
We are aware that there are several water supply, water purification businesses and even water refill stations scattered all around Cherry Creek – Denver which is why we spent time and resources to conduct our feasibility studies and market survey.
We ensured that our facility is easy to locate and we have mapped out plans to develop a wide supply network for offices, construction sites and manufacturing plants all around Cherry Creek – Denver and neighboring cities.
Much more than selling and supplying purified and treated water, our customer care is going to be second to none. We know that our customers are the reason why we are in business which is why we will go the extra mile to get them satisfied with our services.
We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large they are. We will ensure that we get our customers involved when making some business decisions that will directly or indirectly affect them.
Mark Warren® Water Supply, Inc. is owned and managed by Mark Warren. Mark Warren who is the Manager of the Company has a Degree in Water Resources from Denver State University. He has over 14 years’ experience working in related industry as a senior manager prior to starting Mark Warren® Water Supply, Inc. He will be working with a team of experienced employees to build the business .
We are in the water supply business to sale and supply treated water to households, offices, construction sites and industrial plants via our hygienic water supply tankers and we are going to do all that is permitted by the law in the United States of America to achieve our business goals and objectives.
Our Business Structure
Mark Warren® Water Supply, Inc. is established with the aim of competing favorably with other leading water supply brands in the industry and in future to also open our distribution channels across key cities in the United States of America.
This is why we will ensure that we put the right structures in place that will support the kind of growth that we have in mind while setting up the business.
We will make sure that we only employ people that are qualified, honest, hardworking, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders.
As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more depending how fast we meet our set target. For now, we will contract the maintenance of our water tankers and pumping machines to a service provider, we don’t intend to maintain a very large overhead from the onset.
But as soon as the business grows and stabilizes, we will assemble our own in-house maintenance team. In view of that, we have decided to hire qualified and competent hands to occupy the following positions;
Water supply business Manager
Water Tanker Drivers
Chief Executive Officer – CEO (Owner):
Sales and Marketing Manager
Accountant/Cashier
Pump Operators:
As a business, we know that if a proper SWOT analysis is conducted for our business, we will be able to position our business to maximize our strength, leverage on the opportunities that will be available to us, mitigate our risks and be equipped to confront our threats.
Because of our quest for excellence when it comes to running a standard water supply business, Mark Warren® Water Supply, Inc. employed the services of an expert HR and Business Analyst with bias in startup business to help us conduct a thorough SWOT analysis and to help us create a Business model that will help us achieve our business goals and objectives.
This is the summary of the SWOT analysis that was conducted for Mark Warren® Water Supply, Inc.;
Part of what is going to count as positives for Mark Warren® Water Supply, Inc. is the vast experience of our management team , we have people on board who understand how to grow a business from the scratch to becoming a national phenomenon with the shortest time possible.
So also, the location of our water supply business, our large distribution network and of course our excellent customer service culture will definitely count as a strong strength for the business.
A major weakness that may count against us is the fact that we are a new water supply business in Cherry Creek – Denver and we don’t have the financial capacity to compete with American Water Works Company Inc. when it comes to economies of scale and controlling national distribution network.
The opportunities for water supply businesses are enormous due to the fact that water is an essential commodity that we use on a daily basis.
As a result of that, we were able to conduct a thorough market survey and feasibility studies so as to position our water supply business in the right location to be able to take advantage of the existing market and also to create our own new market. We know that it is going to require hard work, and we are determined to achieve it.
One of the major threats that we are likely going to face is drought. Other threats that may likely confront us are unfavorable government legislature and the arrival of a new water supply business and water refill station in same location where ours is located.
The need for clean and drinkable water will continue to exist as long as human exist. Water is one of the commodities in our world that doesn’t have any substitute. If you want to take a bath; you use water. If you want to quench your thirst; you need water.
If you want to fix a meal; you need water. This points to the fact that clean and drinkable water is as important as the air we breathe in and it will continue to be in demand globally.
A large percentage of water supplied for irrigation is not sourced from public water supply systems. However, irrigation activity only accounts for less than 5.0 percent of industry revenue. As the price of agricultural products rises, farmers tend to demand more water for irrigation, which benefits industry operators.
The agricultural price index is anticipated to fall in 2018, presenting the industry with a potential threat. As a matter of fact, households represent the largest source of revenue for the Water Supply and Irrigation Systems industry. As the number of households rises, so does demand for water from residential customers, benefiting industry operators.
The number of households is expected to expand in 2018, presenting an opportunity for the industry. Lastly, another trend in water supply business is the adoption of eco – friendly approach towards the treatment and supply of water. As a matter of fact, the industry’s adoption of eco-friendly practices will persuade environmentally conscious consumers to buy its products, while increasing operators’ efficiency.
When it comes to selling and supplying treated water, there is indeed a wide range of available customers. In essence, our target market can’t be restricted to just a group of people, but all those that resides in our target market locations. We are in business to engage in sale and supply of treated water to the following groups of people;
Our competitive advantage
We are aware of the stiff competition and we are prepared to compete favorably with other water supply business in Cherry Creek – Denver and throughout the United States of America where we intend opening outlets of our water refill stations.
Some of the things that is going to count as competitive advantage for Mark Warren® Water Supply, Inc. is the vast experience of our management team , we have people on board who understand how to grow a business from the scratch to becoming a national phenomenon.
Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category in the industry, meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our aims and objectives.
We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.
Mark Warren® Water Supply, Inc. is established with the aim of maximizing profits in the water supply business in the United States of America and we are going to go all the way to ensure that we do all it takes to sell and supply our treated water to a wide range of customers.
In essence, Mark Warren® Water Supply, Inc. will generate income by selling and supplying treated and purified water.
One thing is certain when it comes to water supply business, if your water is properly treated and your water tanker hygienic and if your water supply business is centrally positioned and easily accessible, you will always attract customers.
We are well positioned to take on the available market in Cherry Creek – Denver and every city where we intend opening outlets and we are quite optimistic that we will meet our set target of generating enough income/profits from the first six months of operation and grow the business and our clientele base.
We have been able to examine the water supply business, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projection for Mark Warren® Water Supply, Inc., it is based on the location of our business and other factors as it relates to small and medium scale water supply business startups in the United States;
N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be drought and there won’t be any major competitor offering same products as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.
Prior to choosing a location for Mark Warren® Water Supply, Inc., we conducted a thorough market survey and feasibility studies in order for us to penetrate the available market in our target market locations.
We have detailed information and data that we were able to utilize to structure our business to attract the number of customers we want to attract per time and also for our treated water to favorable compete with other leading brands in the industry.
We hired experts who have good understanding of the water supply business to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in Cherry Creek – Denver.
In summary, Mark Warren® Water Supply, Inc. will adopt the following sales and marketing approach to sell our treated and purified water;
Regardless of the fact that our water supply business is licensed and centrally located in a location that has good human and vehicular traffic, we will still go ahead to intensify publicity for all our product and brand.
Mark Warren® Water Supply, Inc. has a long – term plan of opening our water supply business – outlets in various locations all around the United States of America which is why we will deliberately build our brand to be well accepted in Cherry Creek – Denver before venturing out.
Here are the platforms we intend leveraging on to promote and advertise Mark Warren® Water Supply, Inc.;
We are aware of the pricing trend in the water refill line of business which is why we have decided to have various sizes of gallons and water tankers.
In view of that, our prices will conform to what is obtainable in the industry but will ensure that within the first 6 to 12 months, our treated water are sold and supply a little bit below the average price in the United States of America. We have put in place business strategies that will help us run on low profits for a period of 6 months; it is a way of encouraging people to buy into our water supply business.
The payment policy adopted by Mark Warren® Water Supply, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that Mark Warren® Water Supply, Inc. will make available to her clients;
In view of the above, we have chosen banking platforms that will enable our client make payment for the purchase of our treated and purified water without any stress on their part. Our bank account numbers will be made available on our website and promotional materials to clients.
A water supply business requires reasonable startup capital hence an entrepreneur would have to pool cash together or welcome investors to partner with you. Although the capital needed to set up a water plant might not be much, but the running capital of the business is always the real deal.
You would need capital to purchase water tankers and also to fuel and maintain your water tankers. These are the key areas where we will spend our startup capital in setting up Mark Warren® Water Supply, Inc.;
We would need an estimate of two hundred and fifty thousand Dollars ($250,000) to successfully set up our water supply business in Cherry Creek – Denver.
Generating Funds/Startup Capital for Mark Warren® Water Supply, Inc.
Mark Warren® Water Supply, Inc. is a private business that is owned and financed by Mark Warren. He has decided to restrict the sourcing of the startup capital to 3 major sources.
N.B: We have been able to generate about $50,000 ( Personal savings $30,000 and soft loan from family members $20,000) and we are at the final stages of obtaining a loan facility of $200,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.
The future of a business lies in the number of loyal customers that they have, the capacity and competence of their employees, their investment strategy and business structure. If all of these factors are missing from a business (company), then it won’t be too long before the business closes shop.
One of our major goals of starting Mark Warren® Water Supply, Inc. is to build a business that will survive off its own cash flow without injecting finance from external sources once the business is officially running.
We know that one of the ways of gaining approval and winning customers over is to retail (supply) our purified water a little bit cheaper than what is obtainable in the market and we are well prepared to survive on lower profit margin for a while.
Mark Warren® Water Supply, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.
We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
Check List/Milestone
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Published Mar.14, 2022
Updated Apr.24, 2024
By: Jakub Babkins
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Table of Content
Bottled water is one commodity consumed in all parts of the world, and of course, those in the business of producing bottled water are known to generate sales all year round if the company is well-managed. The economic downturn hardly affects the consumption of bottled water simply because it is a commodity that is as important as the air we breathe.
Production companies in the bottled water industry purify bottled water into plastic and glass bottles for consumption. The process involves use of a comprehensive business plan for bottled water and detailed franchise business planning .
If you plan on having a water purification and bottling business of your own, here is a purified drinking water business plan developed for Aqua Dreams. If you are confused about how to start a packaged drinking water business, this plan will provide you with all the details you need to know before going forward with your startup idea.
The business plan for Aqua Dreams is as detailed as a business plan for Starbucks . Hence it is assured that it will answer all your questions regarding how to start a purified water business.
2.1 the business.
Aqua Dreams will be a licensed and standard bottled water production company situated in an industrial area in Orleans, Massachusetts. We have been able to secure a long-term lease for a facility in a strategic location with an option of a long-term renewal on agreed terms and conditions favorable to us. The reason behind this successful execution is a well-thought-out water purification and bottling business plan .
While taking an entrepreneurial initiative, it is essential to ensure that all aspects of your business are coherent. Hence, you must prepare a unique bottled water business plan that helps you seek sufficient funding.
Having said that, while writing a bottled water business proposal, you must analyze all the available resources. If you intend to raise loans, you should also study some business plans for banks because the process of getting loans can be exhaustive.
While thinking of how to start water bottle business, you must understand who your target market is. Including this detail in your water purification business plan will help you in subsequent planning. The recurring customers of Aqua Dreams are identified as:
Our vision is to establish a standard bottled water Production Company whose products will be sold in Orleans – Massachusetts, and throughout the United States of America and Canada . There would be no compromise on the quality of the product, and complete transparency would be offered concerning our filtering processes.
3.1 company owner.
Aaron Finch will be the owner of Aqua Dreams. Aaron has strong leadership and organizational skills that he acquired while working at different water filtration plants since 2009. He graduated with a major in resource management from the University of Texas and researched this field ever since. He identified a lack of efficient purification systems in existing firms in the market and hence felt the need to introduce an innovative bottling water business plan.
The bottled water production industry is profitable, and it is open for any aspiring entrepreneur to come in and establish their business. Aaron thought of coming up with a packaged drinking water business plan so that he doesn’t miss on any important aspect.
Step1: Planning for the business
Before setting up your business, looking into all the available resources and planning your way forward is essential. It gives you an idea of the availability of human resources and capital. If you are adding farm-related aspects to your business, it would be beneficial to also read out farmers market business plan before making a business plan for your startup.
Step2: Get Recognized
The next step is to be recognized by defining your business’s services and values. Having the proper business structure is very important to us at Aqua Dreams. Besides, producing healthy, portable, and well-packaged bottled water, we aim to impart perfect customer care service.
Step3: Offices
The cooperate office of Aqua Dreams will be located in the industrial zone of Orleans. It will be a feasible location since it would grant easy access to resources. Consequently, the cost of acquiring production factors would be low. The market trends in this water purification business plan pdf can help you strategically choose your corporate office’s location.
Step4: Online Presence
Living in an age of social media and digitalization, having a web presence is imperative for a company’s success. The website for Aqua Dreams would entail the company’s purification and bottling methods to educate the consumers about the sustainable processes we use.
Step5: Marketing
The last step is developing and executing a marketing plan to promote your services. In your business plan for bottled water , you must add marketing strategies that you will be using to reach out to the target customers. For diverse and unique advertisement ideas, research is imperative. You may need to visit several business operational models such as a liquor store business plan to gain an insight into the expectations of your target market.
Legal | $114,400 |
Consultants | $0 |
Insurance | $22,200 |
Rent | $31,600 |
Research and Development | $10,000 |
Expensed Equipment | $52,200 |
Signs | $3,400 |
Start-up Assets | $122,400 |
Cash Required | $209,000 |
Start-up Inventory | $39,000 |
Other Current Assets | $122,000 |
Long-term Assets | $287,000 |
Start-up Expenses to Fund | $233,800 |
Start-up Assets to Fund | $779,400 |
Assets | |
Non-cash Assets from Start-up | $940,800 |
Cash Requirements from Start-up | $112,000 |
Additional Cash Raised | $50,000 |
Cash Balance on Starting Date | $35,000 |
Liabilities and Capital | |
Liabilities | $19,200 |
Current Borrowing | $0 |
Long-term Liabilities | $0 |
Accounts Payable (Outstanding Bills) | $58,100 |
Other Current Liabilities (interest-free) | $0 |
Capital | |
Planned Investment | $1,013,200 |
Investor 1 | $0 |
Investor 2 | $0 |
Other | $0 |
Additional Investment Requirement | $0 |
Loss at Start-up (Start-up Expenses) | $47,300 |
Ideas to start your own bottled water business can be daunting and confusing. If you are new to the business and are unaware of the facilities to offer, you can refer to the services available at Aqua Dreams mentioned below:
The most preferred processes used for the purification process are reverse osmosis, deionization, and distillation. Aqua Dreams will use reverse osmosis systems as they remove up to 99% of organic substances and ions from the water. This process is discussed in detail in our water purification plant business plan.
This type of bottled water is the most often used to replace tap water. It has varying levels of dissolved minerals and does not contain added carbonation. In this bottling water business plan, we will list how much sales of this product were expected in a period lasting three years.
Sparkling water, also known as seltzer, soda, or tonic water, is infused with carbon dioxide to create tons of bubbles and fizziness. It is often used as a healthy substitute for sugary sodas and other beverages because it is lower in calories and sugar. We will offer different flavors of the product to meet the expectations of our customers.
Flavored water is a beverage with added natural or artificial flavors, herbs, and sweeteners. Aqua Dreams will offer different options to its customers for a wider target market.
If you are new to the industry and are thinking how to start a water bottling plant, it is recommended that you go through this water bottling business plan pdf and learn about the technicalities involved.
Excellent work.
excellent work, competent advice. Alex is very friendly, great communication. 100% I recommend CGS capital. Thank you so much for your hard work!
In this water bottling plant business plan, you will find a detailed marketing analysis conducted by Aqua Dreams. This is the perfect water purification business plan sample for your reference if you are confused about how to start a water purification business.
Research conducted by IBIS World shows that the level of concentration in the purified drinking water business is modest in the USA. The top four players are expected to generate 65.5 percent of revenue. The industry is responsible for the employment of well over 14,360 people. Experts project the bottled water production industry to grow at a 4.0 percent annual rate.
While analyzing how to start a water purification business, you must investigate your target audience. Market segmentation is vital to understanding the scope of your filtered water business. If you don’t know who you will be interacting with, you can refer to the customer groups of Aqua Dreams mentioned below:
5.2.1 hotels.
The minibars you see in your hotel rooms are usually stocked with bottled water of all kinds, let it be still, sparkling, or flavored. Hence, Aqua Dreams will be supplying bottled water to different hotels on a contractual basis. Since they place large orders, their revenue would be the main reason behind the success of our water purification business.
Since sparkling water is also often used in cocktails and other drinks to create a fizzy sensation, restaurants in the city will be the primary customer group for this specific product for Aqua Dreams. Our products will also assist them with their purification systems installed in the kitchens.
Nowadays, instead of serving water in glasses, it is preferred to offer bottled water to the guests. Hence event planners are expected to procure bottled water from us and provide it to the customers they are dealing with.
Carbonated and fizzy drinks are loved by almost everyone these days, which can be bad for their health. Our flavored water, supplied to retailers nationwide is relatively less unhealthy and therefore we expect to have great sales of it.
Hotels | 32% | 31,900 | 38,280 | 45,936 | 55,123 | 66,148 | 10.00% |
Restaurants | 28% | 31,800 | 38,160 | 45,792 | 54,950 | 65,940 | 10.00% |
Event Planners | 14% | 11,700 | 14,040 | 16,848 | 20,218 | 24,261 | 10.00% |
Retailers | 26% | 21,300 | 25,560 | 30,672 | 36,806 | 44,168 | 11.00% |
10% |
Our prices will conform to what is obtainable in the industry. We have put in place those business strategies that will help us run on low profits for six months.
Regardless of whether you are thinking of having a bottled water company business plan or a water purifying business plan, you need to have an effective marketing strategy. It would help you stand out amidst competition and capture market share.
Aqua Dreams will use a robust set of marketing and sales strategies mentioned in this water bottle business plan pdf. Hence it would be helpful for you to read it thoroughly if you are wondering how to start a packaged drinking water business.
Unit Sales | |||
Bulk Purified Water | 8,500 | 9,010 | 9,551 |
Still Bottled Water | 9,250 | 9,805 | 10,393 |
Sparkling Bottled Water | 6,500 | 6,890 | 7,303 |
Flavoured Bottled Water | 7,500 | 7,950 | 8,427 |
Unit Prices | Year 1 | Year 2 | Year 3 |
Bulk Purified Water | $60.00 | $69.60 | $80.74 |
Still Bottled Water | $75.00 | $87.00 | $100.92 |
Sparkling Bottled Water | $70.00 | $81.20 | $94.19 |
Flavoured Bottled Water | $75.00 | $87.00 | $100.92 |
Sales | |||
Direct Unit Costs | Year 1 | Year 2 | Year 3 |
Bulk Purified Water | $15.00 | $16.50 | $17.33 |
Still Bottled Water | $15.00 | $16.50 | $17.33 |
Sparkling Bottled Water | $20.00 | $22.00 | $23.10 |
Flavoured Bottled Water | $15.00 | $16.50 | $17.33 |
Direct Cost of Sales | |||
The average cost involved in a bottled water production water business plan is similar to that in a donut shop business plan .
It is important to account for different kinds of costs to forecast financial returns accordingly. These costs also include the salaries of employees at the purification plants. To give you an idea of average salaries in the market, the salaries of our employees are quoted in this purified water business plan.
While thinking of water business ideas, the following are the positions you would essentially recruit for:
Plant Manager | $40,000 | $44,000 | $48,400 |
Operations Manager | $32,000 | $35,200 | $38,720 |
Production Assistants | $172,000 | $189,200 | $208,120 |
Marketing Officer | $25,000 | $27,500 | $30,250 |
Delivery Drivers | $65,000 | $71,500 | $78,650 |
QA Engineer | $25,000 | $27,500 | $30,250 |
A sole focus on increasing sales does not ensure that your business has become successful. For generating profits, you need to do a thorough analysis of your water company profile and estimate the operations’ capacity for your business accordingly.
In your financial plan, you must identify when and how to cover your investment amount with the earned profits. Moreover, you should evaluate the business projections and ratios to assess how the financial trajectory of your enterprise will go in the coming years. These assessments are important to highlight in your business plan for a water purification plant because they help investors decide whether to fund your bottled water startup or not. Besides, they help you direct your efforts to achieve your business goals.
If you don’t know how to conduct a financial analysis, you can refer to this water bottle business plan pdf.
Here we’re providing a business plan used by Aqua Dreams for you to use as a reference.
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 8.12% | 8.20% | 8.26% |
Long-term Interest Rate | 8.40% | 8.44% | 8.47% |
Tax Rate | 24.03% | 24.21% | 24.60% |
Other | 0 | 0 | 0 |
Monthly Units Break-even | 5340 |
Monthly Revenue Break-even | $132,500 |
Assumptions: | |
Average Per-Unit Revenue | $231.00 |
Average Per-Unit Variable Cost | $0.62 |
Estimated Monthly Fixed Cost | $163,800 |
Other | $0 | $0 | $0 |
TOTAL COST OF SALES | |||
Expenses | |||
Payroll | $359,000 | $394,900 | $434,390 |
Sales and Marketing and Other Expenses | $145,000 | $148,000 | $156,000 |
Depreciation | $2,300 | $2,350 | $2,500 |
Leased Equipment | $0 | $0 | $0 |
Utilities | $2,900 | $3,000 | $3,100 |
Insurance | $2,100 | $2,100 | $2,100 |
Rent | $2,900 | $3,000 | $3,200 |
Payroll Taxes | $24,000 | $25,000 | $27,000 |
Other | $0 | $0 | $0 |
Profit Before Interest and Taxes | $1,174,300 | $1,559,697 | $2,069,819 |
EBITDA | $1,174,300 | $1,559,697 | $2,069,819 |
Interest Expense | $0 | $0 | $0 |
Taxes Incurred | $234,860 | $311,939 | $413,964 |
Net Profit | $939,440 | $1,247,757 | $1,655,856 |
Net Profit/Sales | 42.29% | 45.68% | 49.31% |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $51,000 | $55,080 | $59,486 |
Cash from Receivables | $22,000 | $23,760 | $25,661 |
SUBTOTAL CASH FROM OPERATIONS | |||
Additional Cash Received | |||
Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 |
New Other Liabilities (interest-free) | $0 | $0 | $0 |
New Long-term Liabilities | $0 | $0 | $0 |
Sales of Other Current Assets | $0 | $0 | $0 |
Sales of Long-term Assets | $0 | $0 | $0 |
New Investment Received | $0 | $0 | $0 |
SUBTOTAL CASH RECEIVED | |||
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $42,000 | $42,000 | $45,000 |
Bill Payments | $27,000 | $28,000 | $31,000 |
SUBTOTAL SPENT ON OPERATIONS | |||
Additional Cash Spent | |||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $0 | $0 | $0 |
Other Liabilities Principal Repayment | $0 | $0 | $0 |
Long-term Liabilities Principal Repayment | $0 | $0 | $0 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
SUBTOTAL CASH SPENT | |||
Net Cash Flow | $21,000 | $23,000 | $25,000 |
Cash Balance | $27,000 | $30,000 | $33,000 |
Assets | |||
Current Assets | |||
Cash | $275,000 | $308,000 | $338,800 |
Accounts Receivable | $24,000 | $26,880 | $30,213 |
Inventory | $4,300 | $4,816 | $4,900 |
Other Current Assets | $1,000 | $1,000 | $1,000 |
TOTAL CURRENT ASSETS | |||
Long-term Assets | |||
Long-term Assets | $10,000 | $10,000 | $10,000 |
Accumulated Depreciation | $19,400 | $21,728 | $24,444 |
TOTAL LONG-TERM ASSETS | |||
TOTAL ASSETS | |||
Liabilities and Capital | Year 4 | Year 5 | Year 6 |
Current Liabilities | |||
Accounts Payable | $18,700 | $20,944 | $23,541 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
SUBTOTAL CURRENT LIABILITIES | |||
Long-term Liabilities | $0 | $0 | $0 |
TOTAL LIABILITIES | |||
Paid-in Capital | $30,000 | $30,000 | $31,000 |
Retained Earnings | $53,000 | $57,770 | $63,547 |
Earnings | $193,400 | $210,806 | $231,887 |
TOTAL CAPITAL | |||
TOTAL LIABILITIES AND CAPITAL | |||
Net Worth | $293,400 | $319,806 | $351,787 |
Sales Growth | 7.25% | 8.03% | 8.90% | 3.00% |
Percent of Total Assets | ||||
Accounts Receivable | 9.21% | 10.20% | 11.31% | 9.80% |
Inventory | 5.39% | 5.97% | 6.62% | 9.90% |
Other Current Assets | 2.11% | 2.34% | 2.59% | 2.40% |
Total Current Assets | 149.80% | 151.00% | 152.00% | 158.00% |
Long-term Assets | 11.55% | 11.60% | 11.64% | 12.00% |
TOTAL ASSETS | ||||
Current Liabilities | 4.90% | 4.94% | 4.98% | 4.34% |
Long-term Liabilities | 0.00% | 0.00% | 0.00% | 0.00% |
Total Liabilities | 7.59% | 7.65% | 7.72% | 7.38% |
NET WORTH | ||||
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 94.60% | 97.15% | 99.87% | 99.00% |
Selling, General & Administrative Expenses | 93.56% | 96.09% | 98.78% | 97.80% |
Advertising Expenses | 1.52% | 1.56% | 1.60% | 1.40% |
Profit Before Interest and Taxes | 41.50% | 42.62% | 43.81% | 33.90% |
Main Ratios | ||||
Current | 34 | 35 | 36 | 32 |
Quick | 33 | 33.8 | 34.645 | 33 |
Total Debt to Total Assets | 0.18% | 0.18% | 0.17% | 0.40% |
Pre-tax Return on Net Worth | 74.08% | 74.89% | 75.00% | 75.00% |
Pre-tax Return on Assets | 96.30% | 101.12% | 106.17% | 111.30% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 33.56% | 34.60% | 35.67% | N.A. |
Return on Equity | 55.80% | 57.53% | 59.31% | N.A. |
Activity Ratios | ||||
Accounts Receivable Turnover | 7.7 | 7.8 | 7.8 | N.A. |
Collection Days | 100 | 100 | 100 | N.A. |
Inventory Turnover | 32.4 | 34.02 | 35 | N.A. |
Accounts Payable Turnover | 15.6 | 16 | 16.3 | N.A. |
Payment Days | 27 | 27 | 27 | N.A. |
Total Asset Turnover | 2.5 | 2.5 | 2.6 | N.A. |
Debt Ratios | ||||
Debt to Net Worth | -0.04 | -0.03 | -0.04 | N.A. |
Current Liab. to Liab. | 1 | 1 | 1 | N.A. |
Liquidity Ratios | ||||
Net Working Capital | $244,000 | $257,664 | $272,093 | N.A. |
Interest Coverage | 0 | 0 | 0 | N.A. |
Additional Ratios | ||||
Assets to Sales | 0.85 | 0.87 | 0.89 | N.A. |
Current Debt/Total Assets | 1% | 0% | 0% | N.A. |
Acid Test | 29 | 29.12 | 29.16 | N.A. |
Sales/Net Worth | 2.1 | 2.2 | 2.2 | N.A. |
Dividend Payout | 0 | 0 | 0 | N.A. |
A bottled water plant is profitable, provided a strategic business plan is in place. The average bottled water profit margin ranges between 25-30% for small and medium-scale water plants. It can be as high as 60% for large bottle production. Hence, the question “is bottled water business profitable” really depends on your scale of operations and management.
You can make a business plan and execute it in a set time frame. The most common mistake made when starting a new business is neglecting to write up a business plan. A good purified water business plan establishes a framework and a roadmap for your water purification business. If you try starting a bottled water business without a well-defined plan, your venture might not get successful.
The profit margin in the mineral water business is highly dependent on your products and location. This business can be profitable if you research what is in demand in the market and come with up unique sales ideas to let your customers know about you.
The cost of manufacturing a bottle of water differs from business to business based on the technology that is being used. Moreover, the scale and production level will also affect the cost incurred during manufacturing.
To get an idea of how you can cut costs, you can see a butcher shop business plan . It is generally assumed that mass production leads to lower manufacturing costs and in turn prices.
Download Water Purification and Bottling Business Plan Template in pdf
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By Nick Cotter Updated Feb 05, 2024
1. perform market analysis., 2. draft a bottled water business plan., 3. develop a bottled water brand., 4. formalize your business registration., 5. acquire necessary licenses and permits for bottled water., 6. open a business bank account and secure funding as needed., 7. set pricing for bottled water services., 8. acquire bottled water equipment and supplies., 9. obtain business insurance for bottled water, if required., 10. begin marketing your bottled water services., 11. expand your bottled water business..
Starting a bottled water business requires a thorough understanding of the market to identify your potential customers, competitors, and overall demand. A solid market analysis will guide your business strategy and help you carve out a niche in the competitive landscape. Consider these key points while performing your market analysis:
Yes, bottled water businesses can be highly profitable. Many bottled water companies have seen significant increases in sales and profits in recent years as more people become aware of the health benefits of drinking quality water. Additionally, bottled water businesses may benefit from reduced operating costs due to the lack of large-scale infrastructure and production investments required for other beverage types.
Starting a bottled water business requires a well-thought-out plan to navigate the competitive landscape and regulatory requirements. A comprehensive business plan is essential for securing funding, understanding your market, and mapping out strategies for growth. Here are the key elements to include in your bottled water business plan:
Bottled water businesses typically make money by selling water in bottles to customers. This type of business could target a variety of people such as athletes and gym-goers who need to hydrate throughout the day, busy professionals who don't have access to clean drinking water, or people going on hikes in the wilderness. By targeting a specific demographic, bottled water businesses can make money by selling their product to the right consumers. As an example, a 11 Steps To Starting a Successful Spice Business could target health-conscious individuals looking for natural ingredients and flavors to enhance their meals.
Developing a bottled water brand is crucial to differentiate your product in a competitive market. Your brand should resonate with your target audience and encapsulate your company's values and unique selling proposition. Consider the following steps to create a compelling brand identity:
Naming your bottled water business is an important part of establishing your brand in the marketplace. When coming up with a name, you should think of something creative and memorable that reflects the qualities of your product. Consider using words that denote purity, naturalness, and health, such as “Fresh” or “Natural.” Additionally, make sure the name is easy to pronounce and understand, so potential customers don’t have to struggle to remember or pronounce it. Finally, use a name that stands out from the competition so you can be sure to make an impression.
Formalizing your business registration is a critical step in establishing a legitimate bottled water business. This process lays the foundation for your operations, allowing you to conduct business legally, hire employees, and handle financial matters properly. Here's what you need to do:
Access vital resources designed for bottled water entrepreneurs featuring market trends, operational best practices, and strategic growth advice:
Starting a bottled water business requires adherence to various regulations to ensure product safety and compliance with local, state, and federal laws. Before beginning operations, it is crucial to acquire the necessary licenses and permits. Here’s a guide to help you navigate this process:
In order to start and run a bottled water business, you will need to obtain several licenses and permits. Depending on the state or country your business is located in, some of the necessary licenses and permits may include a general business license, a food handlers license, a manufacturing license, and an occupational health license. In addition, you may need to obtain approval from your local zoning board as well as any other applicable local agencies. Finally, if you plan to sell your products outside of your state or country, you may need to obtain additional licensing and permits from those jurisdictions.
Opening a business bank account is a critical step for managing your finances and legitimizing your bottled water business. Alongside, securing the necessary funding will ensure that you have the financial resources to cover startup costs, production, and marketing. Follow these guidelines to set up your financial foundation:
Setting the right price for your bottled water services is crucial for balancing customer satisfaction and your business's profitability. In determining your pricing strategy, consider factors like production costs, market demand, competition, and perceived value. Follow these guidelines to establish an effective pricing strategy:
Initiating a bottled water business can involve substantial financial commitment, the scale of which is significantly influenced by factors such as geographical location, market dynamics, and operational expenses, among others. Nonetheless, our extensive research and hands-on experience have revealed an estimated starting cost of approximately $71500 for launching such an business. Please note, not all of these costs may be necessary to start up your bottled water business.
Starting a bottled water business entails ensuring that you have the right equipment and supplies to produce, bottle, and distribute your product efficiently. The following is a list of essential items and considerations to keep in mind when acquiring your bottled water equipment and supplies:
Securing the right business insurance is an essential step in protecting your bottled water business from potential risks and liabilities. It's important to understand the various types of insurance available and to determine which ones are required or recommended for your specific business needs. Below are some guidelines to help you navigate the process:
Consult with an insurance agent who specializes in commercial policies to ensure you have comprehensive coverage tailored to your business needs.
Marketing is a crucial step in the success of your bottled water business, as it helps to create brand awareness and attract customers. A well-planned marketing strategy can set you apart from competitors and build a loyal customer base. Here are some effective strategies to market your bottled water services:
Once your bottled water business is up and running, it's time to think about expansion. Growing your business can involve a variety of strategies from increasing your product line to reaching new markets. Here are some key steps to consider:
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We have revised some aspects of our 2025-30 business plan in light of a draft determination from our regulator, Ofwat.
In October 2023 we submitted our business plan for 2025-30 to our regulator, Ofwat, for scrutiny and assessment. The plan proposed levels of investment to maintain and enhance services to both customers and the environment.
In July 2024 Ofwat published its provisional assessment of our business plan, known as its draft determination. This set out its view on all aspects of the plan, including required levels of investment, the performance that it expects from this investment, and the associated level of customer bills.
We have published our response to Ofwat’s draft determination. This is the next step in Ofwat’s five-yearly price review process.
At draft determination, Ofwat challenged our plan and proposed that bills should reduce by 2% over the five-year period. Our response reiterates the need for significant investment, much of which is to meet obligations set by regulators, and if approved will see bills rise by 29% over the next five years, incrementally – not in one go. Next year’s bills will increase by approximately 9% and in real terms, bills will still be lower in 2030 than in 2010. Our plan does not include any investment that has already been funded and we are not asking customers to pay twice.
However, for any customers who struggle to pay we will continue to offer a range of low-rate tariffs and plan to grow the total numbers we support. We believe nobody should spend more than 5% of their disposable household income on their water bill and are committed to eradicating water poverty by 2030.
Our plan proposes £3.65 billion of new investment to upgrade infrastructure, protect the environment, safeguard future water supplies and create local jobs, including:
Ofwat will now review our revised plan and make a final decision no earlier than December.
Read a summary of changes to our plan or find our full response to Ofwat below.
WSX-M01 Cover letter
WSX-M02 Summary of WSX response to Ofwat's PR24 DD
WSX-M03 Guide to reading representations
WSX-M04 Company representation proforma
WSX-M05 Quality and ambition assessment
WSX-M06 Long-term delivery strategy
WSX-M07 Uncertainty mechanism
WSX-M08 Briefing document for company representation meeting
WSX-A01 Board assurance statement
WSX-A02 Assurance reports
WSX-C01 Step up in capital maintenance and base costs
WSX-C02 Enhancement costs
WSX-C03 Overall approach to costing
WSX-C04 Retrospective nature of draft determination
WSX-C05 Enhancement costs - water quality improvements
WSX-C06 Enhancement costs - Strategic Resource Options (SROs)
WSX-C07 Enhancement costs - leakage and smart metering
WSX-C08 Enhancement costs - supply schemes
WSX-C09 Enhancement costs - wastewater treatment
WSX-C10 Enhancement costs - Water Recycling Centre (WRC) growth
WSX-C11 Enhancement costs - storm overflows
WSX-C12 Enhancement costs - pollutions
WSX-C13 Enhancement costs - resilience
WSX-C14 Enhancement costs - greenhouse gas emissions
WSX-C15 Enhancement costs - water investigations
WSX-C16 Enhancement costs - wastewater investigations
WSX-C17 Enhancement costs - biodiversity and conservation
WSX-C18 Bioresources and the Industrial Emissions Directive (IED)
WSX-C19 Retail costs
WSX-C20 Cost adjustment claims
WSX-C21 Real price effects
WSX-C22 Frontier shift
WSX-C23 Business rates
WSX-C23 Appendix - Business Rates Model
WSX-R01 Risk and return
WSX-R02 RoRE modelling
WSX-R03 Ofwat's proposed gearing cap
WSX-R04 Consultation on equity listing mechanism
WSX-R05 Financeability and financial resilience
WSX-R06 Affordability
WSX-R06 Appendix - Table SUP15
WSX-R07 Cost recovery plan
WSX-R07 Appendix - RCV Run-off Rate Model
WSX-O01 Performance and outcomes
WSX-O02 Price control deliverables
WSX-O03 Measures of experience
WSX-O04 Ofwat's reporting and assurance proposals
WSX-D00a August 2024 data tables
WSX-D00b ADD1-21 data tables
WSX-D00c ADD24 data table
WSX-D01 Commentary on data table changes - Outcomes
WSX-D02 Commentary on data table changes - Risk and return
WSX-D03 Commentary on data table changes - Costs wholesale water
WSX-D04 Commentary on data table changes - Costs wholesale wastewater
WSX-D05 Commentary on data table changes - Water resources
WSX-D06 Commentary on data table changes - Bioresources
WSX-D07 Commentary on data table changes - Retail
WSX-D08 Commentary on data table changes - Developer services
WSX-D09 Commentary on data table changes - Long-term strategies
WSX-D10 Commentary on data table changes - Supplementary tables
WSX-D11 Commentary on data table changes - Summary tables
WSX-D12 Commentary on data table changes - Past delivery
WSX-D13 Data tables commentary - Additional tables
WSX-D14 Data tables summary - company response
WSX-T01 Financial model - Draft Determination response
WSX-T02 Revenue reconciliation model
WSX-T03 RCV reconciliation model
WSX-T04 Revenue forecasting incentive model
WSX-T05 2023-24 ODI performance model for use in the PR24 business plans
WSX-T06 2024-25 ODI performance model for use in the PR24 business plans
WSX-T07 Residential retail reconciliation model
WSX-T08 Developer services model
WSX-T09 Water industry national environment programme (WINEP) reconciliation model
WSX-T10 Cost of new debt reconciliation model
WSX-T11 Cost reconciliations model
WSX-T12 Tax reconciliation model
WSX-T13 Land sales model
WSX-T14 RPI-CPIH Wedge True Up model
WSX-T15 Strategic regional water resources reconciliation model
WSX-T16 Bioresources reconciliation model
In March 2024, our plan was updated in some areas. The key changes and their impact on expenditure and average bills are summarised below for reference. However, this information is superseded by the changes submitted in August 2024.
Since the submission of our PR24 business plan to Ofwat in October 2023, we have made some small changes to parts of our plan. These have been in response to requests from Ofwat or other regulators and to clarify some points in our original plan. The result of these changes to date is that Ofwat are now considering a PR24 business plan for Wessex Water that includes total expenditure of £5,007 million (down from £5,031 million in our October 2023 plan), and average annual customer bills of £666 by 2030 (down from £668 in our October 2023 plan). We expect Ofwat's draft determinations will be based on this expenditure and these bills, and the associated data tables .
The main reason for the change to our total expenditure for PR24 and associated average annual customer bills is a reduction in the costs of our smart metering programme. We have also made some corrections to the costs of planned net zero and biodiversity schemes, which has slightly affected our total expenditure.
Ofwat has also asked us to provide some further data tables to reflect the Environment Agency’s 18 September 2023 version of the Water Industry National Environment Programme (WINEP). These tables reflect the additional costs of delivering the full WINEP nutrients programme by 2030, rather than phasing some of this programme beyond this date (as proposed in our business plan). This would increase total expenditure to £5,416 million and average customer bills to £690 by 2030. However, it is important to note that this is not a revised Wessex Water business plan submission in that:
Consequently, we do not expect Ofwat's draft determinations to include this expenditure and its impact on bills.
An average bill increase of up to 30% (up to £670) would still mean that Wessex Water bills are lower in real terms than they were 15 years ago. However, we are very conscious that this is a time of austerity so any bill increase will be unwelcome, and that some customers are already struggling to pay the current level of bills. Almost all our investments are driven by legal or regulatory requirements but even so, we will work hard with our regulators to minimise the bill impact.
For customers who find it difficult to pay, we already have tailored assistance programmes to help and we will extend these as necessary to meet our commitment of eliminating water poverty by 2030.
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This is a complete business plan for a packaged water business. It will be easier to plan and budget as you will be aware of all the costs involved in setting up and running the purified water business. Uses of the Mineral Water Business Plan (PDF, Word And Excel) The bottled water business plan can be used for many purposes including:
Here are a few tips for writing the market analysis section of your bottled water company business plan: Conduct market research, industry reports, and surveys to gather data. Provide specific and detailed information whenever possible. Illustrate your points with charts and graphs. Write your business plan keeping your target audience in mind. 4.
Step 3: Brainstorm a Bottled Water Business Name. Here are some ideas for brainstorming your business name: Short, unique, and catchy names tend to stand out. Names that are easy to say and spell tend to do better. Name should be relevant to your product or service offerings.
Business Overview. ClearRiver Bottled Water Company is a startup bottled water company located in Knoxville, Tennessee. The company is founded by Eileen Dursten, a local landowner with a series of fresh waterfalls and streams located on her thirty-acre property just outside the city of Knoxville.
Traditionally, a marketing plan includes the four P's: Product, Price, Place, and Promotion. For a bottled water production company, your marketing plan should include the following: Product: In the product section, you should reiterate the type of bottled water company that you documented in your Company Analysis.
Below is the sales projection for Sparkles® Bottled Water Production Company, it is based on the location of our business and other factors as it relates to small scale and medium scale bottled water production company start - ups in the United States; First Fiscal Year-: $100,000. Second Fiscal Year-: $250,000.
At $0.0036 per gallon, this comes to $8.87, or $0.444 per cu ft of resin serviced. Sewer. Assuming all the water goes down the sewer with a minimal need for balancing chemicals, at $0.0032 per gallon, this comes to $0.4027 per cu ft of resin serviced. Per cu ft of mixed bed. $1.39 of acid and $1.10 of caustic soda.
Develop Your Bottled Water Company Business Plan. One of the most important steps in starting a water company is to develop your bottled water business plan. The process of creating your plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to ...
In your water distribution company's business plan, the first section is the executive summary — a captivating overview of your plan that aims to pique the reader's interest and leave them eager to learn more about your business. When crafting the executive summary, start with an introduction to your business, including its name, concept ...
Start a bottled water business by following these 10 steps: Plan your Bottled Water Business. Form your Bottled Water Business into a Legal Entity. Register your Bottled Water Business for Taxes. Open a Business Bank Account & Credit Card. Set up Accounting for your Bottled Water Business.
ClickUp's Business Plan Template for Water Companies is here to guide you through every step of the process, from defining your mission to projecting your financials. With this template, you'll be able to: Clearly outline your strategic objectives and goals. Conduct a comprehensive market analysis to identify your target audience and competitors.
Use this free bottled water business plan template to easily create a great business plan to start or grow your business. ... How To Write a Company Analysis for Your Business Plan. Dave Lavinsky, April 2, 2024 How To Develop the Customer Analysis Section of Your Business Plan. Dave Lavinsky, November 6, 2023 Crafting a Lean Business Plan ...
When launching a bottled water company, significant capital is required, especially on the front end. From sourcing spring water access to bottling equipment to product distribution, expenses add up. We'll analyze typical start-up and ongoing costs to factor into your business plan. Start-Up Costs. Securing spring water rights often demands ...
The Importance of a Business Plan for a Bottled Water Business. A business plan is a critical document for a bottled water business. It serves multiple purposes, such as acquiring funding and attracting investors. Moreover, it acts as a roadmap to keep you on track during the startup phase and while your business is in full operation.
The cost for hiring business consultant (including writing business plan) - $2,500. The cost for insurance (general liability, theft, workers' compensation and property casualty) coverage at a total premium - $2,400. The cost for payment of rent for 12 months at $1.76 per square feet in the total amount of $50,600.
A bottled water plant is profitable, provided a strategic business plan is in place. The average bottled water profit margin ranges between 25-30% for small and medium-scale water plants. It can be as high as 60% for large bottle production.
2. Draft a water purification business plan. 3. Develop a water purification brand. 4. Formalize your business registration. 5. Acquire necessary licenses and permits for water purification. 6. Open a business bank account and secure funding as needed. 7. Set pricing for water purification services. 8. Acquire water purification equipment and ...
The #1 Bottled Water Business Plan Template & Guidebook will provide entrepreneurs with the step-by-step guidance they need to turn their dream of a thriving bottled water enterprise into a reality. ... newfounderz is a modern day business media company that helps entrepreneurs build successful businesses across the globe. 867 Boylston St 5th ...
Website. 5. Acquire necessary licenses and permits for bottled water. Starting a bottled water business requires adherence to various regulations to ensure product safety and compliance with local, state, and federal laws. Before beginning operations, it is crucial to acquire the necessary licenses and permits.
The purpose of creating the 2019-2023 Water Utility Business Plan is to help guide River Falls Municipal Utilities (RFMU) toward defining its goals and strategies and identifying steps needed to work toward achieving those goals and strategies. Staff used internal and external cost projections for the business plan to identify future ...
ServiceTitan is a comprehensive water treatment business software solution built specifically to help service companies streamline their operations, boost revenue, and achieve growth. Our award-winning, cloud-based platform is trusted by more than 100,000+ contractors across the country.
As a water and sewerage company we provide essential services to 2.9 million customers across the south west of England. ... The result of these changes to date is that Ofwat are now considering a PR24 business plan for Wessex Water that includes total expenditure of £5,007 million (down from £5,031 million in our October 2023 plan), and ...
The City of Moscow Water System consists of approximately 6 wells and 3 storage tanks with approximately 4.5 million gallons of water capacity. Our team maintains 99 miles of mainline, 1,000 hydrants, 3,000 valves, and 6,284 services! Moscow's water infrastructure meets or exceeds all industry standards and ensures that the public water ...
Plans & Studies. Comprehensive Sewer System Plan (PDF) Comprehensive Water System Plan (PDF) Moscow Sanitation Water Wastewater Rate Study Report (PDF) Contact Us. City of Moscow. 206 E Third Street. Moscow, ID 83843. Phone: 208-883-70 00.
Water Leak Policy. Water & Water Reclamation. The Water and Water Reclamation Division of the Public Works Department is a service oriented Division that provides safe, aesthetically pleasing potable water, efficient dependable sewer collection, and reliable, high quality waste water treatment. Utility Bill Newsletters
Under the direction of the Public Works Department, the City of Moscow's Water Distribution system delivers an average of over two million gallons of potable water per day. Our distribution system delivers safe, potable water to more than six thousand active points of service. Major components of the distribution system include three elevated ...
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