Growth opportunities and latent adjacency in Bottled Water Processing Market

The report Bottled Water Processing Market by Technology (Disinfection, Ion exchange, Filtration, and Packaging), Equipment (Filters, Bottle washers, Blow molders, Shrink wrappers, and Others), Product Type, Packaging Material, and Region – Global Forecast to 2023″, The bottled water processing market is estimated to account for about USD 211.61 billion in 2018 and is projected to reach a value of about USD 315.96 billion by 2023, at a CAGR of 8.3%.

The increase in demand for packaged drinking water in the Asia Pacific region has played a considerable role in the bottled water processing market. As a result of the growing demand for potable water, bottled water processing equipment manufacturers are opting for membrane filtration technologies, to eliminate unwanted elements from water and to enhance the quality and shelf-life of drinking bottled water. The water treatment equipment manufacturers are developing innovative technological solutions and systems to convert high salinity waters such as seawater and brackish waters to potable drinking water, as the demand for drinking water is increasing in water-short areas.  

Market Dynamics

“Increase in consumption of bottled water is driving the overall market”

Bottled water is considered an easy way to remain hydrated and helps in maintaining a healthy diet. In 2017, according to the IBWA (International Bottled Water Association), the per-capita consumption in the US exceeded 42 gallons in 2017, while the intake of carbonated soft drinks reduced to less than 38 gallons. Due to multiple qualities such as convenience, healthfulness, safety and high-quality value, the bottled water segment is seen as an attractive segment in the US beverage industry. In addition, many consumers prefer the taste of bottled water. Bottled water in the US is widely regulated by the Food and Drug Administration (FDA) as a packaged food product and provides a consistently safe and reliable source of drinking water. Many bottled water manufacturers are launching new products with flavoring substances and bold, attractive packaging. They are also bringing to the market a wider range of flavor bottled water.

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This growth in demand for bottled water in terms of both quantity and quality as per governmental regulations drives the bottled water processing market. The Asia Pacific market is expected to grow at the highest CAGR in bottled water processing market due to huge growth opportunity of the bottled water industry in countries such as India, China, Indonesia, Vietnam, South Korea, Thailand, and Malaysia. As a result of the increasing trends in premiumization, China’s bottled water industry is seen to have a robust increase over the coming years. High volume consumption, bulk water purchases, shifting trends in drinking habits, and rising disposable income are some of the factors that are driving the bottled water market in these countries.

Scarcity of energy increases operational costs for the bottled water processing industry, thereby acting as a major restraint”

The high energy and operation cost act as a restraining factor for the bottled water processing market. The underdeveloped countries lack basic infrastructure for distribution, treatment, and storage. Disinfection technologies such as chemical treatment through chlorine gas require huge storage of water to be treated. Such infrastructure and equipment are very low in underdeveloped countries. The initial investment cost for setting up membrane modules in end applications is very high for small players. Moreover, the existing players are more dominant in the market, which makes it difficult for the new entrants to establish high-cost manufacturing units and market their products. Thus, the high capital cost for setting up new plants becomes the major restraint for the growth of the global bottled water processing market.

“Growth opportunities are high in the Asian market.”

Rising incomes, consumer awareness about the hygiene and quality of the product they consume, and rise in convenience needs are some of the factors that are responsible for the increase in the consumption of bottled water in the Asia Pacific region. The consumers in the region are looking forward to the consumption of nutritional and flavored water, which can help to add to their nutritional intake.

Thus, the rising population in this region has increased the usage of natural resources such as water, thereby, leading to the need for wastewater treatment and water desalination processes. Countries such as India and China, with more than 2.77 billion inhabitants, carry a huge burden of its natural resources, especially water. A majority of the water resources in these countries are contaminated by sewage, agricultural runoff, and industrial chemicals. Establishing and promoting cost-effective membrane filtration products would create substantial opportunities for global bottled water processing companies in this region. For instance, foreign enterprises are helping the local governments in setting up new desalination plants. In September 2018, the Water Treatment Systems of Toray Industries Inc. (Japan) and Dotcome (Japan) have partnered with the Andhra Pradesh government for setting up the desalination project, which can help in the water-related challenges in India.

“High capital investment for bottled water equipment is a major challenge for manufacturers.”

Bottled water processing producers require high capital investments to install processing equipment. These processing equipment not only incur high installation costs but also require timely maintenance, which is an addition of cost that affects the operating margins for bottled water processors. Bottled water processing manufacturers look for more economical options, such as equipment rentals. Renting processing equipment require less capital investment and also saves annual maintenance costs, which are usually taken care of by rental companies. Moreover, the market is developing, as the water is desalinated to make it potable, which is the only way out considering the very limited source of fresh water. In developing countries where the membrane filtration technologies such as ultrafiltration, microfiltration, and nanofiltration do not have full penetration yet, the high cost of the bottled water equipment acts as a challenging factor for the market. Thus, these are some of the main factors contributing to the increased demand for bottled water equipment in the region.

Asia Pacific is estimated to dominate the bottled water processing market in 2018.

Asia Pacific is estimated to account for the largest market share in the bottled water processing market in 2018. The region is projected to offer huge growth potential to the bottled water processing market. The region is witnessing the highest growth due to the rapid economic growth in countries such as India and China. It is attracting investors for setting up production facilities due to the ease of availability of raw materials, skilled labor, land, and equipment at lower costs. The sales of bottled water equipment are mainly concentrated in this region, with key players such as DowDuPont (US) and General Electric (US) offering their products in the Asia Pacific market. Asia Pacific is also a flourishing market for domestic manufacturers such as Aqua Pro systems (India) and Ion Exchange Ltd (India).

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This report includes a study of marketing and development strategies, along with the product portfolios of the leading companies in the bottled water processing market. It includes the profiles of the leading companies such as DowDupont (US), GEA (Germany), Alfa Laval (Sweden), the 3M Company (US), Lenntech B.V. (South Holland), Suez (US), Pall Corporation (US); and prominent players in the global bottled water market including Nestlé (Switzerland), PepsiCo (US), Coca-Cola (US), Danone (France), and Tata Global Beverages (India).