Do you want to start a water purification company? If YES, here is a complete guide to starting a water purification business with NO money and no experience plus a sample water purification plant business plan template.
In case you didn’t know, a water purification company is a business that converts waste or impure water into clean, crystal clear water that is healthy for drinking, cooking and useful for other uses. These businesses help to conserve water and recycle it back to clean usable state.
In this modern age, many homeowners, restaurants and hotels prefer to outsource water supply from water purification companies because to them the water treatment companies provide good water treatment for the water they supply making it very safe for human consumption.
A water treatment business offers a lucrative way to improve health and quality of life. Have it in mind that just the residential water purification market is a multi-billion dollar industry that has grown and diversified over the years, as water softeners, media filtration systems and carbon filters are common fixtures in American homes.
Water purification also known as water treatment business, is a good idea you can start and build to any limit you wish; especially in this new age with people striving to stay healthy. We all know that we human beings cannot go a day without water, as water is very essential for our survival.
This is why there will always be a growing demand for purified water. Apart from the initial cost of setting up a water purification company, you spend less on the everyday running of the business.
This is because water which is your number one raw material can be sourced from anywhere at a very cheap cost or even free, depending on where your source is from. If you are interested in this business, read on to understand the basic ways to start this lucrative business.
Steps to Starting a Water Purification Business
1. Understand the Industry
Studies have shown that the global water purification market has been growing at a steady pace and will continue doing so.
This industry is powered mainly by the growing needs of a burgeoning world population. The need in urban area is comparatively much higher on account of the density of population and high levels of water pollution resulting from industrial waste and massive proportions of garbage being dumped into water bodies.
It also believed that another factor serving to boost demand in the global water purification market is the dearth of fresh water in certain parts of the world such as the Middle East.
It is for these reasons that they have to rely heavily on salty sea water which needs to be desalinated before use. This has served to increase demand for water purification. Also the rising crop of health conscious people around the world concerned about the purity of water they take is also generating sales for water purifications.
Experts believe that the global water purification market which was worth US$ 53.36 billion in 2016 will be worth US$110.02 billion by 2025 by rising at a CAGR of 8.4% during the period between 2017 and 2025.
Have it in mind that the global water purification market can be segmented depending upon the type of accessories they use like pitcher filter, under sink filter, shower filter, faucet mount, water dispenser, replacement filters, counter top filters, household filters, etc.
Of these, the replacement filters are slated to outshine all others vis-à-vis growth rate by clocking a strong 9.5% CAGR from 2017 to 2025 because of their affordable price. Note that water dispensers, counter top, and pitcher filters segments are also expected to clock considerable growth in the upcoming years because of their compact size and less cycle time.
Research has also shown that Asia Pacific market is the most promising market on account of its massive population of 4.4 billion, which is about 60% of the world population. The report went further to explain that the region will likely clock a robust 11.9% CAGR from 2017 to 2025.
Also, aside from its substantial population, rising water pollution and depleting groundwater resources are also moving the water purification market in the region. The RO purification technology is said to be spearheading the growth in the Asia Pacific market.
Note that by registering a CAGR of 5.9% between 2017 and 2025, the market in South America comes in a second position in terms of growth rate. The end-use segment of household will likely drive growth in the market for water purification in the region. The Middle East and Africa is predicted to trail South America in terms of growth rate.
The market in North America for water purification is expected to grow at a CAGR of 5.7% from 2017 to 2027 on the back of strict regulations by the government pertaining to the quality of water.
Experts believe that in the next couple of years, the need for water purification is expected to grow further in the region due to the massive amount of industrial and mining wastes being dumped into rivers. This renders the water totally unfit for human use and necessitates elaborate and expensive water treatment processes.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
Water is a basic need for people to survive, so, the there will always be a demand. But irrespective of how important water is to humans, you need to do an extensive market research before you start this business. This business is great for environmentally-minded individuals. It is also great for those who have worked in the waste-water industry.
Note that a good water purification business owner will be good at making business plans. Additionally, they will be effective at finding suppliers, balancing budgets, and finding cheap equipment. To strive in this business, you must also know how to conduct an analysis of the water in order to determine how sanitary the sourced water is.
Even though residential homes provide great clients, you are better off targeting commercial entities. We suggest you try selling to larger businesses, as they are most likely to buy treated water bottles in bulk. Plus, they can redistribute them for your business.
3. Decide Which Niche to Concentrate On
We believe there are a lot of ways to choose a niche in this industry but the most notable is choosing a specific audience to target.
You need to have a big picture when putting together your business. It is advised that as a new entrant that you consider which audience category your ideas fit into so you can do the appropriate research and analyse the competition effectively. These audiences may include;
- Banks, Insurance Companies and other related Financial Institutions
- Blue Chips Companies
- Corporate Organizations
- Manufacturers and Distributors
- Real Estate Owners, Developers, and Contractors
- The Government (Public Sector)
- Schools (High Schools, Colleges and Universities)
The Level of Competition in the Industry
We all know that drinking clean water is important for both health and well-being. Impure water has harmful bacteria and viruses that can cause water borne diseases in humans. Even governments around the world are now focusing on providing safe and clean drinking water to its citizens.
But in many countries, the quality of drinking water provided by the government is compromised and citizens need to depend on additional filtration techniques. Continuous industrial expansion and concentrated efforts by civic authorities to expand the availability of safe water in households, particularly in rural areas, significantly boosts the global water purifier market growth.
We just have 4% of fresh water available on earth and water purification is needed to take care of health issues such as diarrhea, cholera, and jaundice caused by contaminated water. A lot of water bodies are getting contaminated due to discharge of chemicals and wastes from industries.
Now governments are taking initiatives to reduce the hazardous waste in water bodies and introducing strict policies for the industries. We believe that this is increasing the adoption rate of efficient water purifiers by industries and driving the growth of industrial water purifier market across the globe.
Note that growing disposable income, growing industrialization, and high rate of pollution and population growth in developing countries boost the growth of the market. Improvement in standard of living and growing concerns of health & wellness are expected to boost the demand for water purifiers in future.
4. Know Your Major Competitors in the Industry
- GE Water
- Business Strategy
- Product Portfolio
- SWOT Analysis
- Culligan Industrial Water Systems
- Kraissl Company, Inc.
- Syntec Corporation
- AXEON Water Technologies
- Aquatech International
- Evoqua Water Technologies
Any water coming out from purifiers after all the purification process is free from bacteria, chemicals and other materials which make it safe to use. The world is also trying to create awareness about hygiene and health hazards caused due to contaminated water.
Experts believe that these factors are likely to increase the adoption rate of water purifiers in manufacturing and power generation industries.
We believe that development in membrane technology is enhancing the industrial water treatment market which is simultaneously increasing demand for industrial water purifiers. Membrane bioreactors technology which is using micro and Nano filtration methods are used prominently in water treatment industries.
Have it in mind that these improvements in membrane technology are making water treatment more efficient and cost effective.
We believe that the rising need of recycling and water treatment market is up surging the demand of industrial water purifiers across the globe. Even though continuous degradation of membranes of filters increases the operational cost and reduces the efficiency.
Note that timely changing of filters is a costly process which is prohibiting the market growth of industrial water filters. Also dependency on conventional method of water filtration in many industries is withholding the market growth of industrial water purification.
5. Decide Whether to Buy a Franchise or Start from Scratch
We believe that on percentage grounds, a lot of entrepreneurs intend to enter water purification services business by starting from the scratch than through a business franchise. Yet water purification services business start-ups aren’t easy – many fail within the first year.
We believe that by buying a profitable water purification services business; you will reduce the amount of time it takes to achieve a return on your investment because you will have the benefit of a proven operation and an existing customer base.
If you are interested in a turn-key water purification business with plenty of support, you may want to consider purchasing a franchise. Do note that franchises offer proven business models, financing, marketing and technical support, among other services.
You will be needed to sell the franchisor’s brand of equipment and adhere to certain operational guidelines. If you want more freedom and flexibility, you may choose to operate as an independent dealer. Even as an independent dealer, you can expect some vendors to offer you technical training and, in some cases, marketing support.
6. Know the Possible Threats and Challenges You Will Face
Starting your water purification business can be very hard if you don’t have prior experience in this line of business but if you are hardworking and you are willing to learn, you will surely find it a bit easier. Note that the profit you stand to get from this type of business is largely dependent on your marketing and sales strategies. The few challenges you might face may include;
- writing a business plan
- Getting insurance
- Getting a suitable location
- Getting qualified workers
- Industry competition
- Industry laws and government regulation
- Writing a good marketing plan
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
This particular decision is very crucial to the success of your business. Any decision you make should involve a number of considerations including taxation, owner liability, governance, capital structure, and potential exit strategies, to name a few.
The best legal entity for a water purification business is the LLC. A limited liability company (LLC) is an unincorporated entity in which one or more individuals called “members” have limited liability for the enterprise’s debts and claims even if they participate in management.
You should know that the benefit of creating an LLC typically outweighs any perceived disadvantages; and they are typically unavailable to sole proprietorships and general partnerships. Also it is advisable that you consult an experienced attorney and accountant while preparing your business plan to make sure your facts and figures are accurate and legal because you should avoid creating loopholes.
8. Choose a Catchy Business Name
- Dirt Free
- Water Active
- Best Aqua Company
- Water Win Filters
- Aqua Victa
- Water zone Mineral Factory
- Pure Hill Water Purifier
- Alright Purifiers
- Epic Touch
- Water Wave
- Germ Away
- Neat life
- Pure Blend
- White Moon Technology
- Pure first
- Water Star
- Green Mount
- Beeny Water Technology
- Europa Purifier
- Life safe water technology
- Bring Pure
9. Discuss with an Agent to Know the Best Insurance Policies for You
Note that you will be facing many challenges from water quality to treatment issues. In many cases, water systems are being pushed to the limit by growing urban populations. Such complex risks need specialized coverage unique to this class of business. They may include;
- General Liability Insurance
- Inland marine insurance
- Property insurance
- Workers’ compensation insurance
- Commercial Auto insurance
- Umbrella liability insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
Competition in this industry is alarming, even with very few major players taking control of the industry. Intellectual property rights are needed in the water purification industry for trademark and patent protection. Note you must research the essentials of patenting and protecting any ideas and procedures you must have developed. It also includes your tagline, logo, and other marketing designs.
You should know that without proper protection, your ideas may be developed by someone else which can jeopardize your business. It’s also very important that you learn more about trademarks, copyrights, and the other legalities of the water purification business by meeting with an expert in the industry.
Also note that registering your trademark helps to protect the goodwill that you create. It is also important to note that proper protection of your trademark and patent can lead to a successful brand development and greatly heightening of the value of your company.
Another way for you to protect your patents and trademarks in the water purification industry is by having your key employees sign employment agreements. A written employment agreement is very important for those employees who know your product formulas as they could do the most damage to the business working for the competition.
11. Get the Necessary Professional Certification
Professional Certification is very necessary in this business as they indicate a level of knowledge and expertise shown by the person certified and they are a uniquely transportable baseline of industry knowledge. Professional certification needed for a Water purification Business may include;
- certified water treatment professional
- Master water specialist
- certified water specialist
- Water Treatment Plant Operation Specialist Certificate
- Certified water technologist
12. Get the Necessary Legal Documents You Need to Operate
In this business, you should be careful and also research the laws to make sure your business has the correct licensing and certifications. To start a water purification business in any state in the U.S you need to obtain a business license. List of other legal documents needed by a Water purification Business are;
- Business license
- Certificate of incorporation
- Employment agreements
- Federal license
- State license
- Local license
- Proof of Insurance
- Intellectual property protection right
- Federal tax identification number
13. Raise the Needed Startup Capital
Water purification is the process of removing undesirable chemicals, biological contaminants, suspended solids and gases from water. The goal is to produce water fit for specific purposes.
Even though there are many competitors in the market, but if you have a substantial finance and creativity with your branding and packaging, you will sure attract your own fair share of the existing market. Financing is a major determinant in the water purification world. Ways to finance a water purification Business may include;
- Funds from Personal savings
- Getting loans from families and friends
- Taking small business loans
- Getting microloans
- Attract an angel investor
14. Choose a Suitable Location for your Business
When deciding on the best location for your water purification business; there are many considerations that must be weighed in making this decision.
From a business perspective, the issues include whether the premises has adequate space for both present and future operations; are the utility systems (electrical and plumbing) adequate to handle operations and waste disposal; and is there adequate office and storage space?
In addition to the business considerations of where to locate your plant, there are many legal considerations that must take into account, including land use and zoning requirements for parking; legality of the commercial venture on the premises; loading and unloading; and compatibility with local Waste Management systems. There are also factors for acquiring the premises.
If the space will be leased, the third party landlord must be amenable to the nature of the business operations. Additionally, the landlord may require a long term lease.
Will a long term lease be compatible with your vision and growth? Do you have the ability to exit the lease if your business needs change before the expiration of the lease term? Do you have the ability to extend your lease under favourable terms?
These factors merely highlight the myriad of issues that most lucrative businesses face when selecting premises to run its operations. Due to the importance of these issues, counsel should be consulted before major decisions are made.
15. Hire Employees for your Technical and Manpower Needs
In this business, you really need to employ workers that will help out in all sections in the factory. When hiring employees that will be directly involved in the purification process, make sure that they maintain high cleanliness and hygiene to ensure that they don’t contaminate the water.
Note that individuals that have prior experience of working for a water purification business will be a best bet for your business. You also need employees in other departments like the accounting department to manage the company’s finances.
You also need to know that most of your business capital will be invested in getting equipment for your water purifying business.
Things you need to get may include commercial Water Filtration systems, Ozonation system, Seawater Desalination plant, Water Purifying and Softening Equipment, Bottled Water Making Equipment, plastic bottles etc. Note that a lot of these machineries cost quite a fortune to buy, but you are sure to recover the money spent in purchasing them within few years in business.
Also have it in mind that it is better for you to out rightly buy these machineries than to lease from other companies. This is because the cost of lease over time will become higher than the actual cost of getting a brand new machine.
The Service Delivery Process of the Business
Note there are a number of ways commonly used to purify water. Their effectiveness is linked to the type of contaminant being treated and the type of application the water will be used for.
Water from lakes, rivers or the ground passes through a screen as it enters the water treatment plant. When the water source is a lake or river, the screen serves an important function, keeping out large natural contaminants such as plants and wood, or fish.
If groundwater is used, screening may not be necessary since the water has passed through layers of the earth in what is essentially a natural screening function.
Here things like alum and other chemicals are added to the water, which cause tiny sticky particles, or floc, to form. This floc attract dirt particles, making them eventually heavy enough to sink to the bottom of the water storage tank.
The water and floc flow into a sedimentation basin. As the water sits there, the heavy floc settle to the bottom, where they remain until removal.
Water passes through layers of gravel, sand and perhaps charcoal, which serve to filter out any remaining particles. The gravel layer is often about 1 foot deep and the sand layer about 2½ feet deep.
Water goes into a closed tank or reservoir. Chlorine or other disinfecting chemicals kill any remaining microorganisms or bacteria in the water and help keep the water clean until distribution.
If a water treatment facility uses ground water as its only water source, disinfection may be the only step required to sufficiently treat the water. After it is disinfected, the purified water sits in the closed tank or reservoir until it flows through pipes to homes and businesses.
You also need to understand the importance of sanitizing your equipment. Sanitisation of water purification equipment with hot water is achieved via an appropriate combination of exposure time and temperature. The primary use for this process is to deactivate viable microbes.
It is worth mentioning that Endotoxin reduction is not achieved as a direct result of the hot water sanitization process. Based on the feed water source, system operating conditions and the end-user’s operating and maintenance procedures, traditional chemical cleaning processes may still be required.
Note that sanitisation using hot water involves incorporating heat exchangers into the traditional clean in place (CIP) system to gradually heat and cool water circulating through the reverse osmosis membrane system.
Membrane manufacturers commonly stipulate a controlled heating and cooling rate to protect against irreversible damage to the membrane and ensure the system’s long-term performance. A typical hot water sanitization sequence would consist of the following phases:
- Initialization (conditions checking)
16. Write a Marketing Plan Packed with ideas & Strategies
In this modern age, the only thing that separates successful water purification businesses from companies at the bottom of the food chain is their marketing plan. A lack of marketing experience can sometimes be overcome through persistence and innovation, two key features of water purification services business marketing success.
Time to Rebrand
There are a lot of reasons why it might be time to begin a rebranding initiative – but a lack of alternative tactics is not one of them. Note that rebranding is an intentional marketing technique designed to deliver long term results. In a water purification services business, brands are tied to specific stages in the life of a business.
But if your business is growing, you will inevitably outgrow your brand and it will be time to prepare for a comprehensive rebranding effort. But if you are confident that you possess the skills necessary to rebrand your business, we advise consulting with a professional marketing firm before you introduce a new brand to your customers.
Excellent Marketing Ethics
Have it in mind that ethically challenged marketers are a dime a dozen in today’s economy. Leaders in this industry avoid marketing tactics that exploit their customers. Ethics are especially important in direct marketing. By relying on trusted list provider, you can ensure that your lists are accurate and are consistent with standard industry protocols.
Social Media Monitoring
We believe that the use of social media as a marketing tool is the newest wave to overtake the small business community. When you put together a functional company website, it attracts new customers and converts them to brand advocates.
You need to be particularly sensitive about the potential for negative brand commentary on social media sites. To counter negative social media, you will need to monitor your brand’s online presence and enter the conversation, redirecting negative discussions toward more positive topics.
17. Develop Iron-clad Competitive Strategies to Help You Win
Note that before you start thinking of how to win your competitors, you need to find out who your competitors are by doing your research on the local competition. Find out who your competitors are by searching online directories and searching your local Yellow Pages. Strategies for winning your competitors may include;
Indeed the cost leadership strategy is typically only employed by large companies that can obtain products cheaply through economies of scale. They turn around and sell these cheaply purchased products to buyers, adding a minimal mark-up to keep the price low.
The idea behind this strategy is to be the cheapest provider of a good or service – making it difficult for your competitors to compete with you. Because this strategy requires economies of scale, it’s poorly suited to most small businesses.
Making use of a unique offering gives you an advantage over your competitors because your competitors simply can’t offer what you are offering.
To develop unique products and services, you have to often invest heavily in research and development – something that many small businesses simply can’t afford. Companies relying on differentiation need to be careful to not develop easily imitated offerings, because that can ruin the uniqueness.
We believe that the low-cost focus strategy is similar to the cost leadership strategy except that it focuses on a niche market. Instead of marketing a product to the entire population it is marketed to a particular segment of the population. The aim of the strategy is to then be the cheapest provider in that segment.
18. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
A lot of entrepreneurs do not know what brand awareness is. Note that this is what makes your business what it is and attract customers for you. Also have it in mind that the best way to achieve brand awareness is to make yourself visible to your target market.
In promoting your brand and corporate identity, you should leverage on the various print and electronic media. Note that it is better and cost effective to use the internet and social media platforms to promote your company, and besides it is pretty much effective and wide reaching. Listed below are the few qualities you need to leverage;
- People skills
- Business and Financial Management Skills
- Work drive and ethics
- Dedication to your clients
- Creative Problem Solving and Fast Decision Making
- Patience and knowledge