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Selling Water by the River: The Bottled Water Controversy Our Case for bottled water

Selling Water by the River: The Bottled Water Controversy Our Case for bottled water. Mark Hoyne Chris Johnson Russ Kurhajetz Tony Larson Fred Lewis. Agenda. History Global Market Economics Safety Personal Choice. History.

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Selling Water by the River: The Bottled Water Controversy Our Case for bottled water

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  1. Selling Water by the River: The Bottled Water ControversyOur Case for bottled water Mark Hoyne Chris Johnson Russ Kurhajetz Tony Larson Fred Lewis

  2. Agenda • History • Global Market • Economics • Safety • Personal Choice

  3. History Bottled Water is not a product of the late 70’s early 80’s. • 18th Century • Jackson’s Spa in Boston began bottling and selling water • 19th Century • New development in mass production of bottles • Growing number wanted their water to be clean and stylish • Status played a big role in early success

  4. History • 20th Century • Bottled water went out of style when chlorination of water was introduced • WWI… Great Depression… WWII • Healthy, free, water sources were abundant • 1977 • $5 million marketing campaign by Perrier

  5. History • 1977 - Perrier • Discovered American concern about safety of water supply • Inconsistent regulation and oversight by U.S. government • Drinking their product became a defining life style choice • With Perrier’s success came competition • 2003 • Second largest commercial beverage category

  6. Global Market • Bottled water is a commodity in a global market place. • Developed countries • United States • Canada • Switzerland • Germany • France • Spain • Developing countries • Mexico • Thailand • Indonesia • Brazil

  7. Global Market • Bottled water’s largest producers reside in Europe • Nestle (Switzerland) • Danone (France) • Europeans consume more bottled water than Americans each year

  8. Global Consumption

  9. Global Consumption

  10. Worldwide Economics • 50 Billion Gallons Sold Annually World-Wide • Approximately $100 Billion Industry • Consumption was about 21 Billion Gallons -1997 • Consumption Predicted to be 68 Billion Gallons by 2013 • Developing Countries Lead Consumption Growth • (per Frontline and Australian Food News)

  11. National Economics • US Bottled Water Companies Employ 163,000 Jobs • Paying Wages of $7 Billion Annually • 9 Billion Gallons Sold per Year - 1st • Total Economic Impact of about $130 billion • Federal Government Collects over $7.6 Billion in Taxes  (per IBWA and NY Times)

  12. Minnesota Economics • MN Bottled Water Companies Employ 3,000 Jobs • Paying Wages of $138 Million Annually • Total Economic Impact of about $2.4 billion • State Government Collects about $120 million in Taxes • (per IBWA)

  13. Local Economics • MN 8th District Bottled Water Companies Employ about 260 Jobs • Paying Wages of nearly $10 Million Annually • Approximately 1,400 ripple effect jobs • Total Economic Impact of about $192 million • (per IBWA)

  14. Safety & Environment The American Society of Civil Engineers recently gave America’s drinking-water systems a grade of… Roughly 10 BILLION Gallons of sewage seeps into these crumbling pipes each year. The Obama administration has secured $6 billion for improvements, but the EPA assessed the cost at D- $335,000,000,000

  15. Safety & Environment • CDC recommends every household have an Emergency Preparedness and Response Kit including water for all family members and pets • Bottled water is comprehensively and stringently regulated and must meet the FDA’s food regulations as well as standards for: • Identity • Quality • Good manufacturing practices • Labeling • Federal law requires that the FDA regulations for bottled water be as protective of the public health as the Environmental Protection Agency (EPA) standards for tap water.

  16. Safety & Environment • All plastic food and beverage containers must meet or exceed all FDA requirements. • The FDA clearance process includes stringent requirements for estimating the levels at which such materials may transfer to the diet. • Safety criteria require extensive toxicity testing for any substance that may be ingested at more than negligible levels.

  17. Safety & Environment • Packaging is 100% recyclable. • Continuing to create lighter weight bottles and are using recycled material in their packaging. • Bottled water is just one of thousands of consumer goods that are packaged in plastic containers . • Bottled water containers make up only 0.3 percent of the entire municipal waste stream in the United States.

  18. Personal Choice • It's NOT a bottled water versus tap water issue. • Drinking water is a good thing, whether from the tap or the bottle. • Bottled water competes with other beverages in bottles - such as: • Carbonated sodas • Juices • Teas • Over 30% of Americans are considered overweight/obese, would you rather they bought a bottle of water or can of soda (NPR)?

  19. Personal Choice • Laws require bottled water advertising, labeling, and marketing to be truthful and not misleading. • Bottled water advertising is aimed at informing consumers about the positive attributes of this safe, healthy, convenient beverage product. • The bottled water industry spends a very small amount on marketing and advertising, just $52 million collectively in 2006, compared to the $637 million spent on advertising for carbonated soft drinks and the $1 billion spent to advertise beer.

  20. Personal Choice • Tap Water – Process through source, treatment and distribution delivers drinking water to the consumer which in most cases includes a chlorine residual. The quality of the tap water depends mainly on factors outside the consumer’s control • Bottled Water – A safe and healthful alternative to other beverages and is delivered in individually sealed bottles to the consumer. Consumers can choose between different package sizes and different products to select the product that best fits their needs. Bottled water is clearly labeled

  21. Personal Choice Is tap water cheaper? Absolutely, but it doesn't come in a container you can take anywhere and then dispose of when you are done. For many people keeping track of a container is - quite frankly - a drag. Over time, reusable plastic water bottles occasionally develop unpleasant odors and/or tastes. How often do you wash your reusable plastic/metal water container?

  22. Conclusion • We aren't paying $1.50 for the water – we are paying $1.50 for the convenience of being able to drink a healthy beverage and then dispose of the container. • Bottled Water and tap water can coexist, this doesn’t have to be a zero sum game. • Each has benefits and consumers should be allowed to choose. • There are scenarios where bottled water is the only option such as • Portability is required: • Disaster Recovery/Relief efforts • Armed forces • Other sources are undrinkable

  23. References http://www.infrastructurereportcard.org/fact-sheet/drinking-water IBWA NY Times Frontline Australian Food News Beverage Marketing Association NPR

  24. Videos/Articles Tap Water: http://www.youtube.com/watch?v=QJWCPhbfDvk http://www.youtube.com/watch?v=-zKXxLkm7I8&NR=1 http://www.youtube.com/watch?v=SOCWYrSDYvo&NR=1 http://www.youtube.com/watch?v=Fp1JvSpshkM&feature=related http://www.youtube.com/watch?v=N3k9CBYsRtA&feature=related http://www.youtube.com/watch?v=5iL3xRoLzmM&feature=related http://www.youtube.com/watch?v=lq_xC9DmOQE http://www.youtube.com/watch?v=Dq1ES9hhJ78 http://www.youtube.com/watch?v=G-dGdE4Rebs&feature=related http://www.youtube.com/watch?v=wwogQWLEqW8 Canadian Pidgeon Droppings: http://www.allheadlinenews.com/articles/7019738181?Pigeon%20Droppings%20Cause%20Of%20White%20Rock%20Water%20Contamination Bayfield contamination http://www.cityofbayfield.com/Bayfield's%20Water%209-29-09.pdf Dr. Strangelove – Water: http://www.youtube.com/watch?v=iYTiIvgugmQ

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