The market for clean drinking water is considered promising, and demand for it is constantly growing. Vending machines claim a significant share of this niche, as they reduce the cost of a liter by 4 times.
A vending machine for selling and purifying water has every chance of seriously competing with bottled water sales and home delivery companies. According to marketing research, every 10th supermarket customer purchases clean drinking water in winter, and every 5th in summer. The cheaper it is and the easier it is to make a purchase, the better for the consumer. Entrepreneurs are interested in the low threshold for entering a business - up to 150,000 rubles.
Brief overview of the market
Sales of bottled water in Russia are increasing, although the volume of this market is much smaller than in developed European countries. Thus, according to marketing research by Nielsen, in 2014 sales increased by 6%, with drinking table water accounting for 36%. It is produced by more than 200 domestic enterprises, 76% of them are concentrated in the Central part and the North Caucasus district (Fig. 1).
The cost of a 1.5 liter bottle in the middle price category is 30 - 40 rubles, in the economy class segment - up to 30 rubles. The share of expensive imported products occupies only 10% of the niche. This is a very attractive market for investors: production is cheap, risks are low, margins are high. Demand for products is growing - people are afraid of the consequences of drinking tap water; most utility networks have been in operation since the times of the Soviet Union.
A device for selling purified water is already part of Russian everyday life, and it is clear that this line of trade has good prospects. First of all, because the price is much lower - up to 5 rubles per liter, and you don’t have to go far - it can be placed anywhere.
Anti-bottle machine gun
Stores rarely sell water in packages larger than 5 liters. Buying 1.5 liter bottles is inconvenient and expensive. After all, it is used not only for drinking, but also for cooking - which, by the way, is being practiced more and more often. Therefore, services for delivering 19 liter bottles to your home are quite a profitable business. However, an automatic water purification machine is even more convenient for customers, because there is no need to place an order in advance, wait for delivery at a set time, or store empty containers for exchange. For an entrepreneur, this is doubly beneficial. Organizing and maintaining a transport service, a staff of dispatchers, and loaders is expensive.
The main thing to remember is that the income of a vending machine directly depends on its favorable location. Where are they usually installed:
- in courtyards, in the center of a residential block for 3 - 5 houses;
- at points of “exit” from the highway to the residential area;
- in places of mass passage from bus stops to residential areas;
- in actively visited stores, pharmacies, and markets.
Devices installed outdoors require anti-vandal protection; it is better if they are located under a canopy or kiosk roof. The most promising place for placement is new buildings in residential areas, for several reasons.
- in houses with an improved layout there are large halls, staircases, places for placing equipment and information;
- in new areas there are usually not enough shops, there are no supermarkets, they are far from the center - delivery there is expensive;
- the residents of such houses are usually active young and middle-aged people - they easily get used to new products, value time, and watch their diet;
- This is very convenient for buyers - they do not depend on time, at any time of the day or night you can buy the required amount of water without leaving your home.
- in houses being occupied, a homeowners association (HOA) is now always created - it is not difficult to come to an agreement with them, they are interested in income from renting out space.
At first glance, a product such as water does not require advertising. And yet, a certain number of bright booklets, leaflets in entrances, mailboxes will certainly be useful. Another thing is quality. It is advisable to hang an explanatory banner next to the machine, which will reflect the entire cleaning scheme in detail and beautifully. This will attract attention, arouse curiosity and the desire to try. Affordable price, ease of maintenance, cleanliness and taste of water will complete the matter - people quickly get used to good things. To increase customer confidence, it would not hurt to indicate a schedule for replacing filters.
According to the Civil Code (Part 2, Article 498), mandatory information must be placed near commercial equipment. This includes: indication of the seller’s details, his location, telephone number, operating hours. In addition, there must be instructions on the rules for using the device, the procedure for payment, and filing claims.
Type, structure and maintenance
How does a water purification machine work, and what is required to service it? Let's consider the principle of operation using the example of the Russian model “Aquatic WA-400Y” (Fig. 1). It is very compact in size: only 0.7 × 0.8 m, and 1.85 m high. At the same time, it holds a tank with a volume of 100 liters and produces 1,700 - clean water per day. To operate, you only need to connect to a standard 220 W power supply and to a water supply. Produced by VendShop, a company specializing in the production of vending machines for almost all types of trade (one of the most popular is for the sale of carbonated drinks).
The filtration system includes 8 degrees of purification. It is based on the reverse osmosis principle: water under pressure successively passes through special membranes that free it from mineral impurities, salts, and rust, and enters a storage tank. Using a pump, it is supplied to the dispensing niche, which is designed to use containers of any volume: from a glass to a 19-liter bottle. During processing, harmful substances are removed from it: nitrites, cadmium, mercury, chlorine, and foreign odors are neutralized (Fig. 3).
Maintenance is minimal: in fact, it comes down to regular filter replacement. New generation vending machines are equipped with modern bill and coin acceptors; control over operation is facilitated by GSM technology. Using programmable functions, you can remotely receive information about the activation of sensors (clogging, impact), the need for collection, blocking of the machine, and analyze sales statistics. If you additionally use modern cloud technologies for accounting and bookkeeping, you can control your business with minimal time.
Get acquainted with the technical characteristics of the machine.
Approximate calculation of investments
Let's calculate the amount of investment in the business of selling drinking water and the payback period for the equipment (Table 1). For example, the cost of the Aquatic WA-400Y machine discussed above is 148,900 rubles. Input data for example:
- according to statistics, the average family of 3 people buys about 270 liters of water per month - 9 l/d;
- Every day, approximately 10 families use the services of one device - 270 l/d;
- tariff for cold water in the region is 19 rubles/m3; sales price for 1 liter is 5 rubles.
- Cost of 1 liter: 81,557 / 98,550 = 0.83 rubles, which is more than 5 times lower than the selling price.
- Revenue for the year: 98,550 × 5 = 492,750 rubles.
- Profit before taxes: RUB 411,193.
It turns out that one water vending machine pays for itself within 4 - 5 months.
A suitable type of activity is “Retail trade outside of stores”, for example, OKVED - 47.99. If you register as an individual entrepreneur, you can use the simplified tax system or UTII (if permitted by local law).
Business prospects in the periphery
Market analysts estimate that there are now about 165,000 vending machines installed in Russia, and by 2020 they predict a doubling of their number. Most of them are concentrated in Moscow and St. Petersburg (Fig. 4). According to the Allbiz trading platform (electronic), in the first 4 months of 2016, sales volume reached the six-month level of last year. At the same time, the number of buyers from the regions is growing: Krasnoyarsk Territory, Yekaterinburg, Kirov Region.
In medium and large cities this niche is practically free. Marketers believe that for a city with a population of 500 thousand people, the market capacity is about 250 machines of the same type. In places with developed tourism, the figure may be higher. Considering the relatively low cost of equipment and the ease of doing business, the vending business can be considered quite promising for development in small towns. In addition, many manufacturers sell equipment in installments.
The availability of water from a tap in your apartment or from a well in rural areas is not always an indicator of the availability of high-quality liquid that can be consumed in its pure form without additional processing. Unpleasant smell, color and taste are the least evil that awaits people when trying to quench their thirst. There may be the presence of microbes and viruses that cause dangerous diseases. Therefore, many today do not want to drink homemade water, believing that the bottled option is safer. The demand for liquid from a store or from a manufacturer is growing and gives citizens reason to think about how to start drinking water production from scratch? The competition is tough, but there is an opportunity to make money if you approach the matter correctly. Our step-by-step instructions will help you understand where to start a water business, what documents to collect, how much money and effort to invest.
How to organize
For many, this business idea will seem like a simple and easily implemented idea. He received permission to sell water from a specific source, put it through a purification system, poured it into a bottle and sent it to store shelves. But that's not true. Water is a product that receives special attention from regulatory authorities, especially the SES. If the liquid does not meet the content requirements, the consumer will never see it.
Before equipping production areas, you need to find a source from which water will be collected. The sample is sent to the laboratory for analysis. After a positive conclusion about the quality, you can obtain permission to use it to produce water that will reach the buyer.
Starting production is possible after determining the type of source:
- Through the water supply tap, crashing into the general system.
- Drilling your own well.
- Having found a spring or spring with good water in sufficient volume.
The entrepreneur chooses his option and begins collecting documents for the implementation of the project. It may take a lot of time.
What documentation will you need to collect?
Having chosen the source of raw material extraction, we collect the liquid into a container and take it to a private or public laboratory. We determine the quality of water, the presence of microorganisms, and harmful substances. The conclusion will show how difficult the further stage of purification and enrichment of the product with useful additives will be. If the composition does not meet your goals, you need to continue searching for a source or enter into an agreement for the supply of raw materials from a trusted raw water producer.
- We enter into an agreement with a partner or obtain permission to drill our own well.
- We contact the energy company to sign an agreement for the use of a separate line for water production.
- We receive a conclusion from the SES on the condition of the premises, compliance of the equipment with sanitary requirements (absence of materials that emit harmful substances that can get into the water during processing and bottling).
- Ready-to-drink water will also have to receive a separate quality certificate from the SES after production starts. Inspections will be carried out frequently and at every stage of activity to ensure that no violations occur.
- Lease agreement for the premises in which the production will be located. If the building is owned, then you need to provide a certificate.
- Documents on the legality of the business are drawn up at the Federal Tax Service, where, after registration, an individual entrepreneur or LLC certificate is issued. You choose the registration form yourself, taking into account your personal circumstances. Let’s not forget to indicate the type of activity according to OKVED. In our case, we choose No. 11.07 - “Production of soft drinks, various bottled drinking waters.”
- A conclusion from the fire department will be required regarding permission to produce water in the selected premises.
This is the main list of documents that will have to be collected to start water production and further work.
Project specifications
In order for water to be of high quality in taste and composition, you must not skimp on the premises and its equipment. Typically, production is located near a well, tap or other source of raw materials. Some manufacturers choose to transport raw water separately to a processing facility and bottle it. The equipment must have a modern multi-stage filtration system to eliminate the risk of obtaining an incompletely purified product. This can contribute to rapid spoilage of water and the appearance of a musty odor. It is better to choose an automatic full-cycle line from filling raw materials to filling into containers.
At the initial stage, you should not spend money on additional enrichment of water with salts, minerals, gas, or sweeteners. You need to understand whether production in the region is profitable and can compete with other companies. The premises must have enough space for a workshop, staff rooms, administrative sector, and storage areas. The workshop area must be clean and sterile. Therefore, it won’t hurt to make cosmetic repairs. Raw materials must be stored in special containers that are tightly closed and do not react when in contact with water.
A separate issue is the supply of packaging. Many entrepreneurs make plastic containers on their own, purchasing special equipment for blowing bottles from blanks. This eliminates the risk of microbes entering the container and makes it possible to choose the shape and color of the water packaging yourself.
The cost of equipment depends on the configuration and manufacturer. There are many offers on the market. It is worth considering what a small water production business is aimed at - small batches of drinking water without gas or a multi-functional workshop (sparkling water, mineral, sweet, medicinal). But it’s not worth saving on equipping the production line. Don’t forget about consumables (filters and other devices) that need to be changed in a timely manner so that the quality of the water does not decrease.
Positive and negative aspects of the enterprise
In any business there are pros and cons that you need to see in advance and try to find your benefit. Let us note the most noticeable shortcomings in this segment of small business:
- Dependence on inspection authorities. The SES monitors water quality, forcing samples to be submitted for testing. If the quality decreases or microbes or viruses are found, production will be closed until the problems are resolved.
- Tough competition. With a wide range of products in stores, from famous brands to little-known ones, it's not easy to find your place.
- The need to search for raw materials that would not require a large number of purification steps. The water should be to the taste of the consumer (such sources are not available in every region).
- The high cost of equipment may be unaffordable for a young entrepreneur if he cannot find an investor.
- Large-scale production requires large areas, which are not always available within the boundaries of a populated area. The further away the workshop is, the higher the cost of transporting products, which can increase the final price of water.
The advantages include the following points:
- Demand for purchasing bottled water is increasing because the quality of tap water in many homes leaves much to be desired.
- Quick payback and high profitability if consumers like the water.
- Possibility of expanding the range at any time, if there is enough space for installation of additional equipment.
- The water production procedure is simple and does not require special skills if you hire a good process engineer.
Eventually
It is possible to open the production of drinking water if there is a good water source, funds to purchase an automated line and distribution channels so that the products do not sit in a warehouse. More complete information on this type of business can be obtained from the business plan for the production of drinking water, posted on our website.
Last summer in Moscow there were no filters for drinking water purification. There was a rumor that terrorists were going to poison the water supply. It blew by. But, despite all the optimism of officials, people in Russia drink tap water less often. Things are getting better for bottled water manufacturers and suppliers. Major players continue their active offensive on the Russian market - Bon Aqua (Coca-Cola), Aqua Minerale (Pepsi-Cola) and Svyatoy Istochnik (Nestle). In Russia today there are already more than a hundred drinking water production plants, so that almost every region also offers water from local producers. “Iceberg” in Kaliningrad, “Davpon” in Syktyvkar, “Polustrovo” in St. Petersburg, “Malkinskaya” in Petropavlovsk-Kamchatsky, “Shishkin Les” in Moscow, “Reserved Spring” in Samara, “Spring of Prikamye” in Perm, “ Clean Water" in the Novosibirsk region.
The offer is extensive. However, all the advantages of bottled water from any manufacturer are offset by one significant drawback - its price. That is, as a drink - perhaps, yes. But today only the wealthiest families cook with bottled water. As a result, the average per capita consumption of bottled water in Russia, according to data for 2004, was only about 14 liters per year. For comparison, in Germany, Spain, France and Italy this figure has been exceeding 100 liters per person per year for several years.
In Russia, most of the population is not yet able to buy bottled drinking water on a regular basis: the price of disposable containers is almost 90% of the cost of the product. Many people see household cleaning filters as a panacea, believing that it is better to pay money for a filter once and then drink clean water “for free”. But, alas, filters do not purify water to the required standards. In addition, “free” turns out to be very conditional, because filters are susceptible to contamination and have to be changed regularly.
After analyzing the situation, businessman from Kirov Vasily Zonov decided that it was time to offer a different option for water supply to the population.
Alternative "plumbing"
The method of providing the city population with clean water, invented by Vasily Zonov, is simple, like everything ingenious. The entrepreneur found out that the main requirements of people regarding drinking water are as follows:
- guaranteed quality;
- low price;
- proximity to the consumer.
To achieve these parameters, Zonov decided to create a network of standard “Health Key” kiosks in the city for the sale of environmentally friendly artesian drinking water in bottling and to establish uninterrupted delivery of this water by road from the well to the kiosks. The sale of water was to be carried out in the buyer's container. Naturally, customers could not only bring the container (a five-liter plastic bottle) with them, but also purchase it right there at the kiosk.
With this method of sale, all basic requirements were met. High quality water was achieved through the use of wells with environmentally friendly water as a source of water supply, the advantages of which were preserved during transportation by vehicles with special containers for transporting food liquids. In addition, during transportation and in kiosks it was supposed to provide the necessary thermal insulation in order to sell water at a temperature of 4–8 degrees Celsius (the natural temperature of water from a well), this was already a matter of technology. As for the low price, it was achieved by eliminating disposable containers from circulation, simplifying the procedure for obtaining water and delivering it to kiosks, and also due to the absence of the need for bottling and storing goods in warehouses.
In addition, Zonov intended to make a profit not due to the high price of a unit of production, but due to the large volume of sales. Finally, proximity to the consumer meant the territorial reach of kiosks for citizens and convenient opening hours: clean drinking water should have been available to almost any buyer.
Vasily Zonov outlined all these aspects in a letter to the head of the Kirov city administration. He did not ask for funding for his project. I only asked to allocate space for kiosks. Probably remembering that the country had long ago adopted the Federal Program “Providing the Russian Population with Drinking Water,” the administration agreed to provide space for kiosks in the areas that the entrepreneur identified in the letter. This was in 2000. And today in Kirov there are already about nine dozen such kiosks, and two-thirds of Kirov residents make full use of delivered water for drinking and cooking.
The difference between water from kiosks and tap water is huge! - said the Kirov taxi driver. “You only have to try tea from it once, and it’s impossible to brew it any other way.” Even if you use a filter. We bought water there for the first time when, due to an accident, it was turned off for the whole day in our area. And then I liked it. How much do we buy? I'll figure it out now. Probably 20–25 liters a week for two people with his wife. Imagine, for 100 rubles you are provided with the purest water for the whole month (water in Kirov costs one ruble per liter - Author's note)! Well, we buy two empty bottles for 15 rubles once a year.
The kiosks are very nice, the kiosks are neat, and the water is tasty and inexpensive. One liter of water costs only fifty rubles. We always buy this water for home and especially before going to the country, since I do not trust water from the local well. Water is delivered to the kiosks from a well in the village of Shoshki, located quite far from the city. How many times have I seen cars with shiny tanks on the highway, so we are sure that the water is not extracted within the city limits, it is really clean. Who's buying? Yes, almost the entire city, even pensioners. Recently I met a grandmother on the street with a cart containing several large five-liter bottles,” Ekaterina Gushchina, a resident of Syktyvkar, told Business Journal.
Image is everything!
- We choose our partners very carefully. I would not want to work with those who strive to get rich at any cost. This business already pays for itself in record time - from 8 to 13 months. It is important that a person does not disgrace the very idea of this business, since any falsification is excluded in it. After all, if a company starts selling tap water under the guise of natural water, this will immediately become clear to customers, and it will be impossible to regain their trust. We need a partner who is solvent and values his reputation. Ideally, an entrepreneur established in his city, for whom this is not the first business, says Vasily Zonov.
Zonov asks businessmen from other cities who have passed the “selection” to become partners of the Key of Health company and open a similar network of drinking water kiosks to evaluate the following resources:
- own and (or) borrowed finances;
- the opportunity to “resolve the issue” with the city authorities about the allocation of space for kiosks;
- Is there really bad water in the city water supply?
- availability of wells with water that meets the highest quality standards.
You need to “enter” this business on a large scale, and you will have to invest a lot at once. You can’t set up one kiosk, then save money for a second and collect money for a third,” says Zonov. - Based on our experience, we recommend starting with at least one kiosk per 15 thousand residents. That is, to open such a business, for example, in a city of half a million, you need 450–500 thousand dollars.
In addition, as practice has shown, it is very difficult to resolve the issue with the city administration. “What to hide, problems with officials are problems for any business. Therefore, despite the fact that this is a socially significant project, before signing the contract, we recommend finding out whether the administration of your city will provide space for kiosks,” advises Vasily Zonov.
Convincing the administration in each city will have to be done differently. Some will give bribes for lack of any other option, while others will be helped simply by a link to the already mentioned Program “Providing the Russian Population with Drinking Water” and a detailed explanation of the social significance of the project. After all, everyone understands that in the near future, safe purification of tap water by ozonation or UV irradiation will not be used in our country. Stainless steel pipes will be needed, and this will require a complete replacement of water supply lines, which, obviously, is far from the “near future.” Now, in most Russian settlements, a barbaric chlorination technology is used, which in this form has long since died out all over the world, because chlorinated water provokes a high incidence of illness, including cancer. Having explained all these problems in a letter to the head of the administration, Vasily Zonov, for example, found support from the authorities. In addition, a free advertising campaign for the “Key of Health” was organized.
This business necessarily involves massive advertising in all media, which must precede the appearance of kiosks in the city. People need to be taught something new, something they have never had before. The essence of all materials in the media should boil down to one thing - finally, thank you, God, there will be an alternative to the city water supply, the quality of the water in which cannot be criticized. And the water in the tap actually smells of chlorine and has an unpleasant taste, color or smell. Or all together. Water analyzes done by the SES also leave much to be desired. In general, poor water quality should be a well-known urban fact, which no longer needs to be proven, but which needs to be talked about. The goal of an advertising campaign is to generate demand. People should be sure that the water in the water supply is bad, but the water in the kiosks is good and is controlled by the SES, says Zonov.
Next are the wells. Drilling and equipping one well can cost much more than a million rubles and will require a lot of time for bureaucratic procedures associated with its registration and launch. And it’s impossible to “drill out” good water right away. But it is absolutely not necessary to drill your own well, since you can find an acceptable one in the vicinity of almost any city. You need to start your search with the Hydrogeological Committee and SES, which also exist in every city. There you should request data on all wells within a radius of approximately 30 kilometers from the city center. Further transporting water becomes less profitable. From the wells found, you need to choose one or two with the best water available in the area, and ideally - the highest category of drinking quality. According to the documents, it must comply with SanPiN 2.1.4.1116–02 “Drinking water. Hygienic requirements for the quality of water packaged in containers. Quality control". If there is not a single well with such water, then there will certainly be one that can be purified to the required parameters. However, it is necessary to remember that filtration will increase the cost of water, and the certificate will not contain the word “natural”.
Having found a suitable well (and hydrogeologists and SES should help here), you need to buy it or enter into a lease agreement. In fact, outside the city, many wells are completely closed or supply water to a couple of houses or some kind of pigsty. The owners are happy to sell them or rent them out, provided that the tenant takes care of all the hassle of providing water to that same pigsty. In general, there are usually no problems with the well. For example, within a radius of 30 km from the city of Kirov there were more than 2,000 wells. Of these, four were selected with the best natural water, which did not require any purification. And out of these four, one was selected taking into account other considerations and requirements. The beauty and environmental friendliness of the area played an important role in this.
Why am I a water carrier?
For those who have conducted a similar assessment of all the resources in their city and received positive answers on all points, entrepreneur Zonov offers to buy a kind of “Russian-style franchise.” This is a package of documents containing a work plan, recommendations, computer programs, forms of necessary documents and advertising materials. The cost of the package is $35 per thousand of the city’s population, but not less than $10,000.
We continue to closely interact with our partners, participate in the launch of the project, train specialists, and provide both consulting and practical assistance,” says Zonov. - Our specialists can go to that city to solve any problems that arise. In general, we support as much as necessary. As for geographic policy, the principle is this: one city - one partner.
For those who do not want to buy “paper,” Vasily Zonov suggests simply purchasing branded kiosks (which are also purchased by full-fledged franchisees) at a price of 163 to 175 thousand rubles, depending on the volume of the order.
So far there has been no desire to counterfeit the kiosks, since they are patented,” says Zonov. - The patent is quite broad, it covers almost any kiosk, regardless of color and shape, which has a water tank on top and a place for a kiosk below. Find someone who can make it cheaper for you - for God's sake! But when making the kiosk, a lot of food-grade stainless steel is used, and it is expensive. In addition, we have streamlined and optimized production. The kiosks are “tested”; everything is provided and taken into account. Even prefabricated foundation formwork with porch and railings, as well as equipment for mounting the kiosk, are supplied. Therefore, it is almost impossible to find someone who will make a similar kiosk cheaper.
Despite the fact that Key to Health has been selling water for more than three years, sales volumes are still growing every month. Nothing surprising. Humans are 80% water. And many people no longer care which one it’s from...
"Water" business in detail
- Main advantages. The project can be presented as a social one within the framework of the Federal program “Providing the Russian population with drinking water,” which makes it possible to support (possibly even financially) from the city administration.
- Investments. About 450-500 thousand dollars to open a business in a city of half a million.
- Format. A network of branded kiosks of the same type at a rate of at least one kiosk per 15 thousand residents at the start of the project, up to one kiosk per 3.5 thousand residents when the market is saturated.
- Payback period. Very short (8–13 months).
- Certificates and licenses. It is necessary to be prepared to interact with the City Sanitary and Epidemiological Supervision Authority, which will regularly check both the quality of water and the entire chain of its delivery from the well to the consumer. For water from a well you need to obtain a certificate from the State Standard of Russia.
- Audience and prices. The entire population of the city, including old people and babies, poor and rich. The cost of one liter of water is 1–1.5 rubles, an empty plastic bottle with a capacity of five liters is 15 rubles.
- Promotion means. A powerful advertising campaign in all city media, preceding the appearance of kiosks, “educational education” leaflets and brochures issued by the kiosk to all customers.
- Staff. The ideal kiosk is a friendly, cheerful pensioner, a former doctor or teacher.
- Competition. Practically absent. Bottled water cannot be compared with bottled water prices and has a slightly different market.
Despite the huge growth in the number of companies producing bottled drinking water, experts predict further growth of the market. There are two ways to build a business on water. The most expensive and reliable is developing your own source, bottling and selling water to customers. Less expensive – intermediary services.
The market is large only in large cities. Here the organization of full-cycle production is truly justified. In smaller cities, it is worth first building a brand image by selling bottled water at retail, and only over time organizing deliveries to offices and developing your own source.
Business registration
Any format of business selling bottled drinking water must be officially registered. If you are planning small deliveries to offices or apartments, you can limit yourself to an individual entrepreneur. Registration will take no more than five days and will require only 800 rubles. state duties. But the population’s attitude towards private entrepreneurship is not always trusting, so it is better to register an LLC. This will allow you to expand your business over time without any problems.
Looking for a source
If you decide to engage in the full cycle of drinking water production, first of all you need to find a source from which you will extract water for purification. Not only a well will do, but also a regular city water supply. To drill a well, you will have to allocate funds and contact specialized companies. But before drilling work begins, its project must be agreed upon with Geocentre-Moscow and RCGSEN. Then you need to obtain a license to use the well and a drilling permit.
The cost of such work depends on its urgency and the depth of the water-bearing layer. The cost of one linear meter is from 950 rubles. For urgent work, it increases to 1,750 rubles. The cost can be calculated based on data on the location of water-bearing layers. For example, in the Moscow region they flow at a depth of 20-100 m in the southern part and 50-200 m in other regions.
Before starting to operate a well, it is necessary to analyze the water that will be extracted from it. In the capital, such research is carried out by the Academy of Public Utilities named after. Pamfilova. An analysis of the intake for 30 characteristics will cost $60. You will be given a conclusion with the characteristics of the water, on the basis of which you can select treatment equipment.
Registration of permits
Before the sale of drinking water from a source can be established, the following permits must be obtained:
- hygienic conclusion of SES for water;
- hygienic conclusion of the SES for production;
- Gosstandart certification for production (for Moscow - VNIIstandart);
- license for trade in drinking water from the Licensing Department (for Moscow).
The last document is issued for three years. To receive it, you need to pay two bills: the fact of reviewing the documents, which amounts to three minimum wages (minimum wage), then another 10 minimum wage when submitting a package of documents. All licensing issues can be resolved by special law firms for $250-300.
Water extraction equipment
The first type of equipment will be needed to service the well itself. A caisson, utilities, and a pump are installed above its mouth. The price of this equipment depends on the manufacturer and ranges from 400 to 4 thousand dollars. If the well is made in an open area, it must be covered with a special metal structure.
As already mentioned, the type of treatment complex depends on the microbiological and chemical characteristics of the water, and is selected individually for each well. But the minimum set includes the following:
- filling machine;
- containers for storing purified water;
- water purification plant.
Setting up production will require 0.15-1 million rubles. depending on the manufacturer, principle of operation, intensity of work and other characteristics. Domestic installations are significantly inferior to foreign ones in terms of convenience and design.
Filling equipment
To bottle drinking water, it is necessary to purchase equipment for disinfection of containers, the actual filling and capping. The cost of equipment also varies greatly from manufacturer to manufacturer and averages 26.5 thousand dollars. To the cost part, you must add another 10% of the cost of this equipment - this is how much its installation will cost.
Typically, such equipment includes:
- Sorption installation for post-treatment of tap water. Its average productivity is 5 tons/day. It costs $200 per year to maintain it.
- Manual washing of bottles with disinfection, which can process up to 60 bottles in an hour. Costs about 3 thousand dollars. An automatic unit costs 25 thousand dollars.
- Storage tanks made of food grade stainless steel. 12 liter containers cost about 15 thousand dollars.
Related equipment
If you decide to initially concentrate only on the delivery of drinking water, opening a company will cost you 10-100 thousand dollars, taking into account the costs of organizing the office.
One of the important cost parts will be the purchase of polycarbonate 19-liter bottles, in which water can be stored for up to six months. They cost at least 150 rubles. thing. But they can be rented from a water supply company. The bottles can be used up to 40 times, after which they need to be changed.
When delivering drinking water to a client, he needs to install a cooler that fits any bottle. They come in two types:
- tabletop - $110-130;
- floor – 170-190 dollars.
It can be sold to a client or rented out for $12-15/month and a deposit of $60 must be paid. When purchasing, make sure that the device is connected to the network without adapters. Coolers must be serviced every six months, and plastic parts must be replaced frequently. Easier to maintain and more popular among the population are pumps that are installed on a bottle.
Entering the market
The sale of drinking bottled water can be organized through your own delivery service or through intermediaries. But even if you decide to go the first route, at the initial stages of business development you will have to resort to the services of intermediaries. But the formation of a client base must be done already at the well development stage. The advantage of having your own well is that you can negotiate the supply of drinking water to food factories.
When working with suppliers, you need to decide how your water will be delivered – under the supplier’s brand or under yours. You can initially supply water under the name of the supplier, and then over time buy it out along with the established customer base, forming a full-cycle operation.
Delivery of drinking water can be organized using our own fleet of vehicles or rented vehicles. Perhaps attracting drivers with their own car. You can start with five cars. To rent a Gazelle van, you will have to pay about 160 rubles. in an hour. A driver with his own car will cost $700 per month including payment for fuel and lubricants.
Return on investment
The payback period depends on the prices of a particular region. For example, in the capital, a liter costs from 6 rubles. from leading companies. In addition, the return of funds depends on how much was invested in production, its capacity and turnover. It is profitable to produce 3-20 thousand bottles per month. Given that the dealer's markup is $1-2 per bottle, the water delivery company will recoup its investment within a year.
Vending machines for cleaning
Today on the market there are special water purification machines that operate using a reverse osmosis system. They look similar to the soda fountains they used 50 years ago. The difference is that today’s one accepts not only coins, but also banknotes and dispenses from 2 to 20 liters of water. The principle of operation is the same: the client substitutes his container, pays for the required volume and receives his purified drinking water.
To install such a machine, you only need a square meter of space. It can be installed in any place where it is possible to connect to a water supply system. The device can work both indoors (gas station, store, supermarket) and outdoors. The latter option will be cheaper since there is no rent. When bottling 300 l. per day, the purchase of a machine will pay for itself in a year.
To install it, it is necessary to obtain approval from the Housing Office and Vodokanal. The SES conclusion is issued by the supplier. Going through all permitting stages will require about $5 thousand.
Business nuances
On average, offices purchase 10 liters of drinking water per person per month. This means that from one office for 50 people you can earn an income of 2 thousand dollars a month on water alone. To this cost we must add the rental of equipment for storing and collecting water from clients. That's another $2 thousand a year.
The advantage of the business is that it is not seasonal - drinking water is always needed. But with high competition, it is important to keep water quality at a high level. Service is important:
- Fast shipping;
- free use of a cooler;
- fast connection with operators;
- polite communication.
You need to understand that the success of your business selling bottled water depends on competent marketing.
The drinking water market is undergoing more and more changes every year. People are increasingly refusing to drink tap water, preferring water purification through special filters or buying bottled water. But neither one nor the other solves the problem of clean water. Therefore, there is a demand on the market for a new type of service: the sale of bottled water. Why is this happening? Is the new type of activity profitable? Beginning entrepreneurs need to find answers to these and many other questions. After all, perhaps this service sector can become an important and profitable business.
Analysis of the water market today
Before you start planning a bottled water business, you need to carefully study the existing market. And the situation here is like this. The choice of drinking water is represented by only two sources: you can buy a special filter and purify the water at home, or you can buy bottled drinking water from drinking water production plants. There are more than enough disadvantages of such services.
A conventionally cheap method of purifying water is using a filter. Conditional, because the filter itself requires constant replacement and has a fairly short service life, otherwise the water will not be purified, but rather the reverse process will occur. In addition, the best home filters do not cope with 100% water purification and do not reach the same quality level.
When it comes to buying bottled water, price comes first. Such water becomes more expensive due to the fact that 90 percent of the cost of a bottle of water is the cost of packaging. Because of such overpayments, not every family can afford to buy water for drinking, much less for cooking or washing dishes. And again, the quality is questionable, which depends not on the water itself, which may be excellent, but on storage conditions, compliance with all necessary standards and deadlines for sale. Under the wrong conditions, high temperature, direct sunlight, or exceeding the expiration date, a plastic bottle begins to release toxins that poison the water, rendering it unusable.
As you can see, there is an acute shortage of high-quality, inexpensive water on the market, which can be an excellent start to a profitable business.
How to set up a business selling bottled water?
There are two schemes by which you can organize the sale of bottled water:
- Sell water through specialized kiosks, bringing water from artesian wells. Suitable for small towns with a short distance from a source of clean water.
- Sell water through vending machines that are connected to the city water supply with water purification using reverse osmosis. Suitable for all populated areas, including millionaire cities such as Moscow.
The second option with vending trade is more universal and can bring greater profitability with less money and time spent on organizing a business, so a novice entrepreneur should pay attention to it.
What is vending and how does it work?
A water vending machine is similar to a familiar coffee machine. It is installed in the most crowded places and connected to the city water supply system. The functionality it is equipped with allows you to achieve water purification up to category 1, premium class. The buyer comes with his container, inserts it into a special hole, puts in money and receives clean water. The cost of such water is 10 kopecks. But the retail price is 2 rubles per liter and above. It is not difficult to calculate that the profitability of the business is more than high.
Advantages of a vending machine compared to selling water through kiosks:
- Minimum space requirement.
To install a vending machine you only need 1 sq. m. area, so it is convenient to place it absolutely anywhere, and rental costs will be minimal.
Important. The best places to place water vending machines include grocery stores, supermarkets, parking lots, gas stations, and in the courtyards of residential areas.
- There is no expense item to pay the salary of the water seller.
The machine accepts money and dispenses water itself.
- 24/7 work.
The device does not need interruptions in operation, there is no need to close or open it.
- To service 15 machines, only one engineer is needed, which significantly reduces the cost of water.
The composition of the water, which is obtained as a result of purification in a vending machine using the reverse osmosis method, is practically no different in its characteristics from the melt water of ancient glaciers and is considered the most environmentally friendly and beneficial for the human body.
Business financial indicators
The cost of one vending machine, which is used to sell water for bottling, is about 250 thousand rubles.
Costs of setting up a business:
- purchase and installation of 10 vending machines – 2.5 million rubles.
- Monthly expenses:
- rent of space for machines – 20 thousand rubles;
- engineer's salary - 30 thousand rubles;
- payment of utility bills (water supply, electricity) - 2 thousand rubles;
- taxes and other unforeseen expenses - 2 thousand rubles.
Total expenses: 54 thousand rubles.
Revenue from the sale of water (400 liters per day, 12,000 liters per month, at a price of 2 rubles per 1 liter) – 24 thousand per month * 10 machines = 240 thousand rubles.
Business payback period: 1 -1.5 years.
Business profitability: 200 percent.
As we can see, the business of selling water to the population is more than profitable, not only for the entrepreneur because of the high profitability, but also for the people themselves, who get an alternative opportunity to buy high-quality water at a very low price. This business has excellent prospects for development in the very coming years. Therefore, entrepreneurs who are still looking for their niche in business should quickly occupy it in the field of drinking water trading.