Do you want to start a mineral water plant company? If YES, here is a complete guide to starting a mineral water plant business with NO money and no experience plus a sample mineral water plant business plan template. If you have a natural spring, well or artesian well source on your property, then you might need to think of starting a mineral water plant. Mineral water is said to be purified water that has been fortified with minerals that are easily absorbed by the human body such as Iron, Barium and Manganese.
Mineral water is usually obtained from natural resources like drilled wells and springs or it is blended and treated with mineral salts in order to ensure that it is artificially fortified. If the water contains less than 250ppm of dissolved solids, it is referred to as natural mineral water. No one can go without drinking water which is why this business can easily become very profitable.
However, while starting the business might look simple enough, the fact that you intend to commercialize your water source will make you come under the scrutiny of the government. So, it is important that you get your source licensed by first contacting a hydrogeologist and then sending in an application with the hydrogeological report accompanying it so that you do not run into any hitches with constituted authorities.
There are certain factors that can affect the source of your water and they include water matrix, source location, regional geography, local, state and/or federal legislation as well as the prevailing supply and demand. In order therefore to ensure that an efficient source development process is being carried out, it is important to conduct preliminary analysis of the water you intend commercializing and also engage a hydrogeologist to carry out a site assessment early in the planning in order for you to know if the potential water source is safe.
Aside from carrying out an assessment on the site, it is important to carry out your research and then write out a comprehensive business plan in order to ensure that the business will succeed. The business plan should handle issues such as the type and size of water plant you intend to set up, how much it would cost you to start it, how much you intend to sell it, when you think it would become profitable, if you will be making your own bottles, your marketing plan and where your business will be located amongst other things.
If you are going to be sourcing for your capital from external parties, then it would do you a whole lot of good to ensure that your business plan is comprehensively written. You could choose to engage the services of a business plan writer to help you in writing a business plan especially as the technicalities might appear to be overwhelming for an entrepreneur just starting out.
17 Steps to Starting a Mineral Water Plant Business
Table of Content
- 2. Conduct Market Research and Feasibility Studies
- 3. Decide Which Niche to Concentrate On
- 4. Know Your Major Competitors in the Industry
- 5. Decide Whether to Buy a Franchise or Start from Scratch
- 9. Discuss with an Agent to Know the Best Insurance Policies for You
- 10. Protect your Intellectual Property With Trademark, Copyrights, Patents
- 11. Get the Necessary Professional Certification
- 12. Get the Necessary Legal Documents You Need to Operate
- 13. Raise the Needed Startup Capital
- 14. Choose a Suitable Location for your Business
- 15. Hire Employees for your Technical and Manpower Needs
- 16. Write a Marketing Plan Packed with ideas & Strategies
- 17. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
1. Understand the Industry
One of the major factors that have driven the growth of the mineral water plant industry is the change in lifestyle and preferences among consumers especially regarding what they consume, and this has caused a boost in the demand for bottled water as opposed to other beverages especially carbonated drinks.
Another factor that has caused a boost in this industry is the growth experienced in the travel industry. Other factors include a rise in disposable income, an increase in population as well as rapid urbanization and premiumisation. According to the Council of Bottled Water Manufacturers, the market for bottled water has steadily increased due to the fact that most consumers do not trust the quality of water supplied in their municipalities.
Individuals regardless of status are purchasing bottled water for use in their offices and homes because it is believed that these bottled water are free of contaminants and are usually gotten from springs or wells that are protected and purified under the scrutiny of the government. Therefore as public water supply continue to be deemed unhealthy, it is expected that the demand for bottled water will continue to increase.
The per capita consumption of bottled water by Americans has grown tremendously over two decades especially as Americans now try to live a healthier lifestyle and coupled with the fact that income is on the increase. According to the Council of Bottled Water Manufacturers, there are more than 430 bottling water plants in the united states, producing over 700 different brand labels as well as flavor.
Even though there are various distribution channels – commercial delivery, retail grocery, restaurant purchase, vending and home delivery – for bottled water; retail purchase accounts for the largest percentage of purchased bottled water.
In 2008, Americans drank more than 9 billion gallons of bottled water with the average per person taking in 30 gallons. Statistics shows that Americans take more bottled water than they do beer or milk. However, even though most Americans prefer bottled water to tap water, according to a report by Food and Water Watch; almost half of the bottled water being sold to Americans are from tap water.
China follows the United States as the number two consumer of bottled water in the world and while the surge in China is understandable due to the fact that many regions lack access to clean drinking water, that of the United States is not simply so.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic compositions of those that require mineral water are those that are looking to live a healthier lifestyle. This includes the young, middle aged and old irrespective of their class or status.
Therefore, if you are looking at defining the demographics for your mineral water plant, then you should strive to make it as all-encompassing as possible.
3. Decide Which Niche to Concentrate On
The consumption of mineral water is usually a symbol of a health conscious lifestyle, a trend that has become popular due to the fact that most Americans are now conscious of what they consume.
While there may not be enough niche areas in this industry, it is important to note that if you intend to specialize in one or more niche areas, then you should ensure that you engage in thorough research so that you do not end up wasting time and resources on niche ideas that your target market will not buy into.
Also, while it is easier for large scale mineral water plants to specialize in several niches due to their large scale of production and availability of resources, small scale mineral water plants might engage in just a few. Below are some of the niche ideas that some mineral water plants may decide to specialize in;
- Mineral Water
- Still Water
- Flavored Water
- Carbonated Water
The Level of Competition in the Industry
The level of competition that exists in the mineral water industry depends to a large extent on the scale and location of the business especially as this is the kind of industry where competition is usually on a national or international scale.
When it comes to mineral water plant, it is certain that distance is not a barrier especially when it comes to competing on a global scale as clients trust the brand especially when they feel that they are getting something that is of the highest quality. Regardless of where your mineral water plant is situated, you will still be able to compete as long as you have a solid distribution system in place.
Therefore, if you are looking to start your mineral water plant in the United States of America, you should be aware that you will not only have to deal with local competitors but also those on a global scale.
4. Know Your Major Competitors in the Industry
In every industry, well known brands exist and serve as a guide to new businesses who study them in order to find out whatever weaknesses might exist and how they can be exploited to their own favor. Some of the well-known players in the mineral water plant industry have been in existence for a long period of time; others have deployed guerilla marketing tactics in order to stand out, while others became popular due to their packaging and pricing.
Some of the well-known brands in the industry include;
- Poland Spring
- Mountain Valley Spring
- Nestle Pure Life
Mineral water consumption has grown at such a rapid rate and has overtaken the soft drinks market with multinationals such as Coca-Cola, Nestle, Pepsi amongst others looking to grab a significant share of the market. This growth trend experienced by the sector is indicative of the fact that water will continue to dominate the beverage category and therefore presents entrepreneurs opportunities that they need.
The United States is one of the single biggest consumers of bottled water in the world as its share in the global market is worth more than $50 billion, even though it has reliable tap water. However, due to the fact that mineral water has been associated with medicinal benefits, several people prefer to go for mineral water rather than take what comes out of the tap.
Europe has the slowest growth even though Perrier and other commercial bottled water have been in existence for centuries. Aside from North America, Asia and South America have all experienced faster growth. Even though there are different types of bottled water in existence such as mineral water, still water, carbonated water and flavored water; the still water is still the largest type of bottled water preferred by most as it accounts for majority of the shares in the region.
5. Decide Whether to Buy a Franchise or Start from Scratch
For any business you are looking to start, you will need to decide the best course of action for you which is either to start the business from scratch or to buy a franchise. While each option has its pros and cons, you should only choose the one that will best suit the needs of your business.
If you are thinking of starting your mineral water plant from scratch, then you should be ready to handle several aspects of a business such as marketing, finance, management and so on. This might sound overwhelming for a new entrepreneur, which is why it is often advised that a comprehensive business plan be in place.
If you intend hitting the ground running, then buying a franchise might just be your best bet; however, it is important that you treat the purchase of this franchise as you would any franchise by engaging in a thorough research.
The benefits that can be gotten from a franchise include not having to worry about marketing and promotion, training and support. However, with the franchise system, you will not run the business under your brand and you cannot make certain decisions on behalf of the company.
6. Know the Possible Threats and Challenges You Will Face
Every business will at every point face threats and challenges either when it is just starting off or while it is running and it is therefore important that an entrepreneur be not only aware of this but also be prepared in handling the obstacles that might likely crop up.
However, it is important to note that while certain threats and challenges can be easily handled; not all can be and when these occur, the entrepreneur should not only identify them but also remain focused on achieving the intended goals and objectives of the company.
Some of the threats and challenges that you are therefore likely to face when looking to start your mineral water plant in the United States include; having to deal with existing competition, stringent government policies, threat from a new competitor and the substitute alternative threat by consumers.
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
When looking to start any business in the United States of America, choosing the right legal entity is very essential to how your business will attain its intended goals and objectives because the various legal entities that exist for entrepreneurs have their varying features that might or might not be suitable depending on the nature of the business. It is therefore important to make your findings before choosing one.
While each legal entity might have its own pros and cons which you should seriously weigh before choosing one, there are several attributes that can help you better make the decision on which legal entity will be right for your mineral water plant. Some of the attributes include, ease of set-up, transferability and control; tax issues, limitation of liability; and investors’ expectations.
Due to how highly regulated this kind of business is and the kind of industry it is in; it would be best if you start your business either as a Limited Liability Company (LLC), S Corporation or a C Corporation. Even though other legal entities such as sole proprietorship and partnership exist, they won’t be sufficient for the kind of business you intend to run.
LLCs are known as hybrid sort of legal entity due to the fact that they have most of the features of other legal entities such as sole proprietorship, partnership and corporation which is the reason why most entrepreneurs usually choose this as opposed to other legal entities.
For the purpose of this business especially if you are not looking to go public with your mineral water treatment plant, the LLC will offer you the flexibility, single taxation, and limited personal liability suitable for you. If you intend to go public, then you might need to start with a corporation which regarding more formality will require you to engage the services of an attorney.
8. Choose a Catchy Business Name
One thing that you will need to possess before filing for a business license is the right business name. The right business name is very important because it can attract customers to your business especially if it is unique and easily pronounceable.
Ensure that you pick several names so that should any that you intend to use be used by another you can easily have a backup name in place. Some of the catchy business names that you can use for your mineral water plant include;
- Lily Spring
- Sweet Spring
- Ever Mineral Water
- Swan Mineral Water
9. Discuss with an Agent to Know the Best Insurance Policies for You
When looking to start any business in the United States of America, it is important that you seek to purchase the right coverage for yourself, business and employees. According to research, most of those who do not make adequate plans when it comes to purchasing insurance policies for their business usually find it hard to keep the doors of their business open especially after they had been hit by a disaster.
Therefore, if you do not want all your investment to go to waste, it is best that you engage the services of an insurance agent to help you in choosing the right insurance policies for your company. Some of the insurance policies that you should therefore look towards purchasing for your mineral water plant include;
- General Liability Insurance
- Workers’ Compensation Insurance
- Commercial Property Insurance
- Health Insurance
- Overhead Expense Disability Insurance
- Motor Vehicle Insurance
- Business Owner’s Policy Group Insurance
- Mechanical Breakdown
- Casualty Insurance
- Product liability insurance
- Professional Liability Insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
A mineral water plant is not a unique business as this has to do with bottling processed water for sale; however those that do add flavor to their water might want to apply for intellectual property protection so as to prevent theft of their concept from their competitors; otherwise applying for an IPP is totally not necessary.
11. Get the Necessary Professional Certification
The mineral water plant industry is highly regulated and any entrepreneur looking to start a business in this industry will be expected to meet certain industry standards before being given the license to operate. This does not however mean that you will need any sort of professional certification before you are allowed to run the business as long as you have the start-up capital and have met the requirements.
This does not however mean that you cannot acquire professional certifications that can help you run the business better if you so desire.
12. Get the Necessary Legal Documents You Need to Operate
When starting any business in the United States of America, there are a list of legal documents that you are expected to have in place if you want to run your business legally. Even though certain legal documents might differ depending on the kind of business that is being run, some documents will however remain constant.
If you however do not know what legal documents you will need to run your mineral water plant, you should engage the services of an attorney to help you out. Some of the legal documents that you will therefore need to run your mineral water plant include;
- Certificate of Incorporation
- Operating Agreement for LLCs
- Business Plan
- Insurance Policy
- Food Permit handler certificate
- Business License and Permit
- Employment Agreement
- Employer Identification Number (EIN)
- Federal Tax Identification Number (TIN)
13. Raise the Needed Startup Capital
Regardless of what scale you are looking to start your mineral water plant business, one thing is for sure and that is that you will need start-up capital that will allow you start and run your business to a level where the business can then generate its own revenue.
Sourcing for start-up capital is however not an easy task for any entrepreneur which is why it is often advised that every entrepreneur have in place a comprehensive business plan that will enable them easily convince potential investors or financial institutions of the viability of their business idea.
Some of the financing options one can explore when looking to start one’s mineral water plant in the United States include;
- Generating part of the start-up capital from personal savings and sale of stock
- Sourcing for soft loan from family members and friends
- Applying for loan from financial institution
- Approaching a venture capitalist or investor for start-up capital
14. Choose a Suitable Location for your Business
One of the important decisions that you will make when looking to start your business is the location of your mineral water plant. Many entrepreneurs have made the mistake of not engaging in thorough research regarding their location and have ended up wasting resources and eventually shutting down the business just before it even starts.
Because this kind of business is highly regulated, you cannot just start your mineral water plant without undergoing some assessment. If the source of water is from your house for instance, the area has to be one that is deemed safe by the FDA before you can commercialize the water.
If the area where your source is hasn’t been zoned, then you will not be able to get a license to run your business. Ensure that either the area is a zoned location or you get a conditional use permit after proving that your mineral water plant will not cause a disruption in the regular activities of the neighborhood.
If you do not understand the dynamics of choosing a location, ensure that you engage the services of a real estate agent to make all the findings for you so that you do not end up wasting time and effort on a location where you would not be granted permission to run your business.
15. Hire Employees for your Technical and Manpower Needs
In starting your mineral water plant, it is important that you decide on what type and size of water plant you intend to run as this will enable you know how much you will need to start the business and therefore the start-up capital you should look to sourcing for. If a nearby competitor started theirs with a certain amount, this should give you an idea on what your start-up capital will be and not necessarily the exact amount you will need to start your own mineral water plant.
Your first step towards making your business idea a reality is to first carry out an assessment on the site before you obtain a license application. Depending on where your intended water plant is located; your license application may be declined especially if it is located in an area that has not been zoned for a mineral water plant.
The bottle liters you intend to offer to your target market – 200ml, 500ml, 1 liter, 2 liters, 5 liters and 20 liters – and how many will determine the kind of mineral water plant you intend to set up. Some of the major equipment you will require include; treatment tanks, alum, sand filter, reverse osmosis plant, micron filters, chlorination tanks, activated carbon filter, ozone generator, ultraviolet disinfectant system, electronic dozer for chlorine, electronic dozer for alum, automatic rinsing, filling and capping machine, water collection tanks (raw and purified), pipeline, shrink wrapping machine, micro-biological instruments. Administratively, you will require computers, phones, filing cabinets, furniture and utility.
Building a solid business structure is very important especially if you intend to make your business attain all its goals and objectives. Ensure that the staff you recruit are not only experienced and competent but also align with your goals and vision.
Some of those you should be looking to hire include; Chief Executive Officer (Owner), Marketing and Sales Executives, logistics manager, accountant, driver, customer service representative, administrative and human resources officer.
Therefore, the number of people that you would need to successfully run your mineral water plant should be at least 8 people.
The Service Delivery Process of the Business
The process that goes into a mineral water production plant starts with raw water being collected in tanks in order to be processed. The water is mixed with alum in order for it to coagulate the insoluble matters or heavy metals. Once the water has been coagulated, it is then allowed to settle and thereafter the reverse osmosis technique is used to remove the impurities.
The supernatant water is then transferred to the chlorination tank where a bubbling chlorine gas is used to disinfect the water. The water is passed through sand filtration in order that undissolved impurities might be trapped, after which it is then passed through carbon filters to remove the color and odor as well as dechlorination.
The water is them passed through a series of micro fillers and also through an ultraviolet disinfection system before it is then packed. The packing bottles are rinsed, filled and then cap fitted with a machine.
16. Write a Marketing Plan Packed with ideas & Strategies
No business plan is complete without there being strategies on how the products and services that will be offered by the company will catch the attention of the intended target market. Marketing might look like a very easy affair but it is one of the most delicate aspects of running a business because if all the marketing ideas and strategies do not fit in with the overall corporate goals and objectives, they are bound to be very ineffective in the short and long run.
This is why a business plan is very necessary because it enables the entrepreneur have an idea of the marketing goals and objectives that should be set in order that whatever strategies and ideas formed will align with the set marketing goals as well as the overall corporate goals. A well thought out marketing idea will enable the company understand its target market.
However, the complexity of this kind of business means that it will be best to hire the services of a reputable marketing agency who not only has a thorough understanding of the market but who have had a fair share of success in helping similar companies also attain their intended goals and objectives.
You can also hire an internal marketing and sales team and ensure that the strategies created help the company attain its goals. Below are some of the marketing ideas and strategies that are suitable for your mineral water plant;
- Engage the services of a professional to develop and create a website which you can use in promoting your products
- Empower your marketing and sales executive to physically market your products
- Make use of your social media platforms such as Facebook, Twitter, Linkedin and Instagram to promote your business
- Install billboards in strategic locations in order to create awareness for your mineral water plant
- Introduce your products to several stakeholders in the industry
- Place adverts on local and national newspapers, magazines, radio and television stations
17. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
Any entrepreneur that is serious about running a successful business knows how important it is to promote the business in order to not only create a unique corporate identity for the business but to also boost awareness for the brand.
Not engaging in any promotional strategies will mean a slow turnover for the products and services being offered by the entrepreneur and therefore a longer period of time with which to attain the desired goals and objectives of the company.
In order to come up with the right strategies that will boost awareness for your brand as well as create a corporate identity, it is best that you thoroughly study your intended target market in order to determine what they want and then know how you can satisfy their wants.
Due to how massive the market for mineral water is, if you intend to go on a low scale promotion strategy; you might not likely not get noticed by your intended target market and so in order to stand out, you will require the services of an experienced promotion and advertising agency with knowledge about your kind of business to help you out. Ensure that whatever strategies created are in line with your corporate goals and objectives.
Below are some of the strategies that you can use to boost your brand as well as create a corporate identity for your intended target market;
- Ensure you place adverts in local and national newspapers, magazines as well as on radio and television stations
- Encourage your customers to concentrate on the flavor of your water in order to create a corporate identity for your business
- Ensure that you take adequate care when it comes to packaging your bottles
- Try and position your bottled water as a solution to unhealthy beverages
- Install billboards in strategic locations in order to create more awareness for your product
- Engage in and sponsor relevant programs in the community