Market Information
Southeast Asia

Water: Tap, Bottled, Refilled, and Delivered⁽¹⁾ (Philippines)

Senen U. Reyes
Senior Management Specialist
Center for Food and Agri Business
University of Asia and the Pacific

Not too long ago, it was common especially in the rural areas to see a man fetch water from an open well or river and carry it to the house of a woman being wooed. Fetching water was a sign of the love and service a man was willing to give to his beloved. Being a natural resource, water was free and clean.

A Generic Natural Resource No More

A lot has changed since then. Water has become more and more a commodity than just a basic necessity. From being a generic natural resource, water has been processed, packed, labeled, and branded. Thus, water has become more expensive and more precious than ever with potable water becoming a scarce resource. Even in the highly urbanized area of Metro Manila, water supply is inadequate with only 60% of the population being served by the Metropolitan Waterworks and Sewerage System (MWSS) with a daily output of 4,000 million liters water shared by the population and industry.

Purified for Commercial Use

The business of purifying water started as early as the 1920s when bottled water was developed in the West. In the country, purification started with water treatment plants and public utilities like the National Waterworks and Sewerage Authority (NAWASA). This later became the MWSS for Metropolitan Manila and the Local Water Utilities Administration (LWUA) for the provinces. The MWSS was later privatized into the Maynilad Water and Manila Water. However it was probably only in the last 20 years when intensive campaigns were started to clean wastewater and provide safer drinking water.

The 1980s saw the proliferation of gadgets and equipment to purify water. This was largely due to the inability of public water utilities to service a considerable part of urban areas much less the rural areas. The deteriorating condition of water distribution lines also contributed to the popularity of water purifiers.

Water purifier brands such as Homemaster, Sanyo, Imarflex, Aquagard, and Tupuro entered the market. Purification was done at home with the simple process of passing tap water through a filter element containing different layers like sand and activated carbon. There are models which use ultraviolet light to kill harmful bacteria. Currently, Waters Philippines with its Waters Bio Mineral Pot is the reputed leader in water purification products in the Philippines. Another product currently in the market is Megafresh Mineral Water Pot and X Green Ceramic Water Filter from Korea.

The 1990s added to the sophistication of water purification technology with the introduction of bottled water from different processes and sources including imports. Raw water is passed through a series of six to eight processes of filtration, adsorptive refinement, reverse osmosis, ultra violet irradiation, and ozonation to get the final product.

Wilkins is reputedly the number one bottled water brand and together with Viva and First comprises a considerable share of the market. These three brands were formerly under La Tondeña which has been in the process of restructuring into a fully liquor-based company.

Source: CFA Databank and research

The sophistication of the water purification process, its packaging, branding, and marketing costs all the more made water expensive. Evian, an imported brand from France, cost almost four times as much as most other brands in the market. Correspondingly, it has the richest source of minerals. Wilkins is the most expensive local brand probably because of its reputation as suited for infant formulation even without boiling. On the other hand, SM Bonus is the cheapest brand. One brand, Nature's Spring, came up with a flavored water variant that costs P16.50 for a 600-ml bottle available in four flavors: apple, grape, honey dew, and lemon.

Bottled water is available in various sizes. The 5-gallon container is usually available through the refilling stations. Sizes readily available in retail outlets and supermarkets are the 6000 ml, 5000 ml, 4000 ml, 2000 ml, 1500 ml, 1000 ml, 600 ml, 550 ml, 500 ml, 350 ml, 330 ml, 325 ml, and 320 ml bottles.

SOURCE: Leading supermarkets

A Closer, Cheaper Source

The advent of bottled water created another business phenomena in water refilling stations which dotted the country like the hot pan de sal, lechon manok, shawarma, and pearl shakes. There is an estimated 3,000 water stores in the country, a good number of which are located inside villages and subdivisions.

The initial concept was for customers to come with their own containers and have it filled on a per gallon basis costing around P8.00 - 10.00. However, the services of these refilling stations have extended to free delivery of 5-gallon containers with free use of a hot and cold dispenser provided a minimum weekly consumption is met. Some stations also sell different types of dispensers and smaller sizes of bottled water.

The popularity of bottled water and refilling stations prompted the National Statistics Office to separate bottled water as another food category from other non-alcoholic beverages. Based on the Family Income and Expenditures Survey in 2000, household spending for bottled water reached P2.4 billion with the National Capital Region accounting for over 50% of the total expenditure with each family consuming roughly one 5-gallon bottle a month.

Table 3. Partial List of Water Refilling Stations

Agua de Camarin
Aqua King
Crystal Clear
Pure and Fresh
Agua Mia
Aqualeen
Crystal Geyser
Purifil
Agua Siempre
Aqualite
Danum
Quench
Agua Ultima
Aqua Mary
Forest Spring
Rain Mist
Agua Vida
Aqua Q
Grotto Spring
Royal Star
Agua Wide
Aqua Road
Heaven Pure
Snow Drift
Alaskan Spring
Aqua Safe
Highland Mist Too
Snow Valley Crystals
Alex's Wateria
Aqua Supreme
Island Stream
Spring Fresh
Anchor
Aqua Sweet
Jennssell
Spring Mist
Alps
Aqua Tree
Life Flo
Top Notch
Aqua 2000
Aqua Trust
Life Line
Water bin
Aquabest
Aqua Zone
Ligtasna
Water Care
Aqua Cool
Arvsons
Microwater
Water Club
Aquafil
Bavesco
Mountain King
Water Depot
Aqua Grande
Bugis
Mr. H2O
Water 4 U
Aqua Health
Cordon Spring
Nature's Flow
Water Mart

Source: CFA databank and research

Another development in the water industry is water delivery through mobile water tanks. This is particularly true in areas not served by Maynilad Water and Manila Water although this is practiced even in the heart of the Ortigas business district in Pasig City. This is also happening in other parts of the country e.g. Baguio City where water is a problem.

Under this scheme, 30 drum capacity tanks mounted on trucks deliver water for all-purpose use to homes and small business establishments. Orders are taken by the drum (40 gal/drum) which cost P20-25 per drum in Baguio City and P30 per drum in Metro Manila. Monthly expenditure for water can run from P1,900 up to P2,800 given an average household size of five members and average daily consumption of 100 liters per person.

Table 4. Partial List of Water Delivery Services

Abagatan Water Delivery
Mat-an's Water Delivery
Begeo Water Delivery
Mega Joy Water Supply
Cordillera Water Delivery
Noel & Joel Water Supply
Dickman's Water Delivery
Pines City Water Delivery
Drop By Jo Water Supply
R.S. Garcia Water Supply
Gesca Enterprises
Sendero Water Delivery
Grandma's Water Delivery
Water of Recca Water Delivery Services
Japson Water Supply
WCG Water Supply
Lily of the Valley Water Delivery
Willwood Water Delivery
Llore Water Supply
Wood Spring Water Delivery
Mark Water Delivery

Source: Newspapers, CFA Research

Safe Water vs. Safe Environment

In a 1995 book by Peter F. Drucker entitled "Managing in a Time of Great Change," he discusses that one of the new markets in the expanding world economy is the market for equipment to purify water and air. He goes on by saying that in the United States, purification of water and effluents is proceeding apace. He continues that municipal sewage is the worst offender when it comes to water pollution. While Mr. Drucker clearly points to the purification of wastewater or sewage water, it is essential that it be purified before it eventually find its way to the sources of potable water.

The rise in bottled water use is not only a local development but is actually led by developed nations. The United States is the largest market for bottled water with annual consumption of 11.2 billion liters but Italians consume more per person at 138 liters closely trailed by the French.

Source: www.asiabwa.org

In the light of providing safe water for man, there lurks a dark side which needs to be managed. Dr. Biksham Gijja, head of Freshwater Program of the World Wide Fund International, estimates that there are 1.5 million tons of plastics needed for the production of water bottles. He warns that toxic chemicals are released during their manufacture and later on in their disposal. This will contribute to environmental pollution and climate change. Already, water bottles are left anywhere and these will likely end up in waterways and drainage systems. This will cause clogging and flooding.

The proliferation of bottled water and refilling stations suggests numerous deep well diggings which may not be regulated by any government authority. Usually the regulation focuses on the finished product not on the source of raw material. There are also a considerable number of households not serviced by public water utilities which built their own deep wells. These drillings and water withdrawals if left unabated may lead to environmental problems.

Business is right in addressing an immediate basic need in providing safe purified drinking water. But this must be done in an environment-friendly and sustainable manner. Business must educate consumers on the proper disposal of the non-biodegradable containers and not draw from this scarce natural resource more than the replenishment rate.

CONSERVE WATER BEFORE IT RUNS OUT!!!

References:

Business World January-February 2003

Family Income and Expenditures Survey 2000

www.adb.org

www.asiabwa.org

www.bottledwaterweb.com

www.clickthecity.com

www.dti.gov.ph

www.inq7.net

www.nestle.com.ph

www.Philstar.com

www.rfm.com.ph

www.wgasupercommerce.com

1. * This industry brief was published by the Manila-based University of Asia & the Pacific, Center for Food & Agribusiness in the February 2003 issue of the Food & Agribusiness Monitor, primarily for a Philippine audience. This industry brief is being made available to Canadian businesspeople in order to provide basic market information should there be export interest in relevant agrifood commodities.