Do you want to know exactly how much it cost to start a bottled water business? If YES, here is a detailed cost analysis for starting a bottled water company and raising finance.
Having provided you with a:
- Bottled water Industry Overview
- Market Research and Feasibility
- Bottled Water Name ideas
- Bottled Water Business Plan
- Bottled Water Licenses and Permits
- Bottle Water Marketing Plan
- Cost of Starting a Bottled Water Plant
- Bottled Water Marketing ideas
We will consider how much it cost to start a bottled water business from scratch including the operating costs.
How Much Does It Cost to Start a Bottled Water Production Company?
One of the reasons why entrepreneurs back down from starting the business of their choice is the financial implications needed to start the business. One good thing about starting a bottled water production business is that you have the options of starting it on a small scale servicing a small community, or on a medium or large scale with a wide range of distribution networks that cuts across different cities and states in the country.
Basically, starting a standard bottled water production company is indeed a capital intensive business. This is so because the amount required to set – up a bottled water production plant is not a piecemeal. The bulk of the start – up capital will be sent on leasing or acquiring a facility and also in purchasing water purifying, bottling, and packaging equipment.
Aside from that, you are not expected to spend much except for purchase and servicing of distribution trucks, paying of your employees and utility bills. This is the key areas where you will spend your start – up capital;
- The Total Fee for Registering the Business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $1,300.
- Marketing promotion expenses for the grand opening the Bottled Water Production Company in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of – $3,580.
- Cost for hiring Business Consultant – $2,500.
- Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
- Cost for payment of rent for 12 month at $1.76 per square feet in the total amount of $105,600.
- Cost for construction of a standard bottled water production plant – $100,000.
- Other start-up expenses including stationery ($500) and phone and utility deposits ($2,500).
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $100,000
- The cost for Start-up inventory (raw materials, bottles and packaging materials et al) – $80,000
- Storage hardware (bins, rack, shelves, food case) – $3,720
- The cost for counter area equipment (counter top, sink, ice machine, etc.) – $9,500
- Cost for water purifying, bottling and packaging equipment – $100,000
- Cost for store equipment (cash register, security, ventilation, signage) – $13,750
- Cost of purchase of distribution vans – $100,000
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, Fax Machines, tables and chairs et al) – $4,000.
- The cost of Launching a Website – $600
- The cost for your opening party – $10,000
- Miscellaneous – $10,000
Going by the report from the research and feasibility studies, you will need about 500,000 U.S. Dollars to set up a small scale bottle water production company in the United States of America.
You will need over 1.5 Million U.S. dollars to successfully set – up a medium scale bottle water company in the United States. If you are considering starting a large bottle water production company with several distribution networks servicing several cities, then you should look towards budgeting well over 5 million United States dollars.
Financing your Bottled Water Plant
It is often said that money is the blood of any business. No doubt raising start – up capital is perhaps one of the major concerns for entrepreneurs; it can be challenging raising capital to launch a business idea. Your idea must be workable and promising for you to secure finance from financial institutions or from angel investors.
The first thing to put in place before sourcing for start – up capital for your business is to draft a detailed business plan. With a good business plan, you can easily convince investors to invest in your business. The truth is that no bank can give you a loan if you don’t have a good and workable business plan. Besides, investors will not take you seriously if you don’t have a business plan on ground before launching out to source for start – up capital.
There are several options when it comes to raising money to finance a start – up business. Some of the options are;
- Raising money from personal savings and sale of personal stocks
- Raising money from investors and business partners
- Applying for loan from the bank
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Sourcing for soft loans from family members and friends.