The Bottled Water Industry is Out of Control

Over the past ten years, the global bottled water industry has taken off; however sales and profits have slumped amidst the global recession.

Following double digit growth at the beginning of the decade, bottled water volume declined by 1.0% in 2008 and by 2.5% in 2009. These declines took producers’ revenues down with them.

Bottled water wholesale dollar sales first exceeded $6 billion in 2000. By 2007, they reached a height of $11.5 billion and tapered off in 2008 and 2009. But despite a slowing in demand, bottled water suppliers continued to make billions in profits.

Fueled by the high profit margins, and the accessibility of water supplies in the United States, huge multinationals have jumped on the bottled water bandwagon.  Some would contend that these companies are doing nothing more than extracting water from the ground, slapping a label on it and reselling it for competitive prices.

Multinationals in this industry include Aquafina (Pepsi), Dasani (Coke), Perrier (Nestle), Evian, and Fiji Water among hundreds of others. Campaigners against bottled water cite concerns – including energy consumption and greenhouse gas emissions, waste, the environmental effect of water extraction, the dangers of privatization and social issues.

Research has shown that bottled water is really not any healthier for the consumer than tap water and is contributing to the destruction of the environment.

The plastic bottles in which the bottled water is packaged are producing up to 1.5 million tons of plastic waste per year. According to Food and Water Watch, such plastic requires up to 47 million gallons of oil per year to produce. Although such plastic bottles are in high demand by recyclers, over 80% are simply thrown away, adding to the deterioration of our oceans and harming marine life that mistake the garbage for food.

Additionally, regulation of the bottled water industry falls under the Food and Drug Administration. In practice, about 70% of bottled water never crosses state lines for sale, making it exempt from FDA oversight. However, municipal water systems in the United States are regulated by the Environmental Protection Agency and are regularly inspected for bacteria and toxic chemicals.

In 2009, the top three bottled water companies in the United States were Nestlé Waters North America (NWNA), PepsiCo and Coca–Cola, the three of which combined accounted for 57.5% of total wholesale dollar sales. The largest water bottler in the country remained NWNA with $3.8 billion in sales.

NWNA, which bottle major regional brands such as Poland Spring, Arrowhead, Deer Park and Zephyrhills, claimed 35.4% of total bottled water sales in 2009. The company’s Pure Life label was one of the few to buck the downward tendency afflicting the market. The brand’s wholesale dollars grew by 18% in 2009.

Pepsi-Cola with just one brand, Aquafina, accounted for 11.1% of the market in 2009. Coca–Cola’s Dasani brand saw $1.2 billion in sales in 2009. Coke also manages or owns several current and former Danone brands in the United States.

As you might assume, the profit margins in the bottled water industry are exceedingly high; the normal profit margin on bottled water is an astounding 50 to 200%. Ironically, as select corporations become richer because of these profit margins, many in the developing world lack access to clean water.

Of course, you, as the consumer, are the one paying a fortune towards those companies’ high profits! And since bottled water is terrible for the environment and not proven to be any better for your personal health, you might want to consider investing in a reusable water bottle.

Remember the following facts each time you contemplate buying bottled water, and make your decision accordingly:

Plastic Water Bottle Facts
Average Serving Size 12 fl ounces
Servings Per Container: only, ever 1

Amount Per Bottle Production
Crude Oil … 3 fl oz.
Water Required … 3x bottle size

Total Bottles
Total plastic for bottles … 900,000 tons
Total CO2 produced … 2.5 million tons
Total oil used to produce … 17 million barrels
Total bottles not recycled … 80%
Percent of water from tap … 40%
Time to decompose … Up to 1,000 years

Published or Updated: June 6, 2013
About Rob Berger

Rob founded the Dough Roller in 2007. A litigation attorney in the securities industry, he lives in Northern Virginia with his wife, their two teenagers, and the family mascot, a shih tzu named Sophie.

Comments

  1. Wendy Warnecke says:

    I’ve been doing research into the bottled water industry and recommend you look at the work Nestle Waters has done to provide clean, bottled water to disaster-stricken areas in the world (where safe tap water is not an option) and their water education programs as well as their partnership with the Nature Conservancy. Will help you be more fully informed.

    • me not you says:

      Wendy Warnecke – Would like writer to seek information on all the wonderful things Nestle is doing in disaster stricken areas was not at all relevant to this article. No one denies that there is a need for bottled water in emergency situations. Pumping it for free from public trust sources and selling it to consumers for up to 3000X the price is not really helping anyone.

    • Christine says:

      They have formula disnepsers with 3 and 4 compartments in them that you can pre-measure. I got mine at target but walmart has them too. I always just added the right amount of water to the bottles and then filled the formula dispenser with the right amount of formula. (I did it for travelling etc) Also, I bought the Nursery Water for my daughter when we were doing formula. Its about $1.25 a gallon, has a pink lid and they sell it at most stores (including walmart). I liked this water because it was flouridated and it’s good for their teeth and dental development. If you are on city water, its most likely flouridated too so you can just boil it and keep it in a gallon jug if you want to save money. Good luck!

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