Zenith Global Report
US Water Dispense Report A comprehensive analysis of the point of use and water dispense markets.
2019
Copyright All copyright in this document is reserved. Liability This document contains information and may contain conclusions and recommendations. Every effort has been made to ensure that the information is accurate and that the opinions expressed are sound. However, Zenith Global Ltd cannot be made liable for any errors or omissions or for any losses or consequential losses resulting from decisions based on the information. Important notice on distribution This report should not be quoted, referred to or transmitted to another party, in whole or in part, with out the prior written consent of Zenith Global Ltd. Should you desire to release a copy of this report to another party for information purposes, we request you and the requesting party to indemnify Zenith Global Ltd from any liability related to the report distribution. Such readers however will not be considered “users� of this report.
2
Š Zenith Global Ltd 2019
Contents Section 1. Introduction and scope 2. Water dispense market overview 3. Bottled water dispense analysis, insights and opportunities 4. Mains fed point of use water dispense analysis, insights and opportunities 5. Integrated tap system analysis, insights & opportunities
3
Š Zenith Global Ltd 2019
Page
1
4
Introduction and Scope
© Zenith Global Ltd 2019
1.Introduction & scope Introduction
Scope
Commentary
Commentary
5
© Zenith Global Ltd 2019
1.Definitions – Water dispense Water dispense: Water dispense units where the primary function is the dispense of filtered & purified water, comprising bottled fed dispense units, mains fed freestanding/countertop point of use units and under the sink/counter integrated tap systems dispensing as defined below. Bottled water dispense (BWD) unit: A unit that dispenses bottled purified, spring or mineral water. The unit can be installed under a rental/service agreement or purchased outright by the customer. Water bottles and pouches are delivered direct to the customer by a distributor. and empty bottles taken away. New bottles & pouches are either placed underneath the unit or inverted and placed on top of the machine. For top fed coolers, a feed tube spike from the machine penetrates the watertight cap in the bottle and opens the valve within the cap, thereby allowing water to flow into the machine or bottle where just a pump is used. The same process is used with bottom fed water coolers with a pump to transfer the water to the point of dispense. Water can be is dispensed either hot, cold or ambient from both top and bottom fed water dispensers. Disposable cups may be provided and are located in a tube on the front or side. Machines are freestanding or table-top and are suitable for larger bottle/pouch formats which are bigger than 10 litres and are therefore larger than those distributed in packaged formats through retail outlets. Total mains fed dispense units: Mains fed filtered point of use (POU) and mains fed under the sink /counter integrated tap systems (ITS) combined as a total as defined below. Mains fed freestanding/ countertop point of use unit (POU) dispensing filtered & purified water: A water dispense device that is plumbed into a mains fed water supply, improving the quality of water via filtration or purification methods. Such machines have drip trays and some have drainage systems. The water can be dispensed cold, ambient, sparkling or hot and available as freestanding or table-top units. Typical methods include ultraviolet (UV) and carbon filter however reverse osmosis units are also available.
Under the sink/under the counter mains fed integrated tap systems (ITS) with functionality dispensing filtered & purified water: A water system that filters/purifies mains water and directs the water to the tap. These systems may utilise carbon filtration, combined/staged filtration or reverse osmosis technology to purify or filter the water. These units can provide ambient, chilled, hot or sparkling water. The units are placed either under the sink or under the counter and are referred to as ‘under counter’ or ‘under sink’ systems. Hybrid mains fed point of use (HPOU) dispense unit: beverage, soda, juice dispense units which can dispense water but whose primary purpose is not water. Water boilers: whose primary function is to boil water as a source of hot water for making hot drinks such as tea & coffee. Vending machines: an automated machine that provides ready to drink hot and cold beverages.
6
© Zenith Global Ltd 2019
1.Verticals
7
Workplace:
Public and Private sector offices and workplaces including municipal, government, factories, armed forces, police, fire, prisons etc
HoReCa:
Hotels, Restaurants & Catering including bars, pubs, nightclubs. foodservice, cafes etc
Retail:
Shops, hairdressers, showrooms etc
Healthcare:
Public and Private Sector medical centres, hospitals, care homes, nursing homes etc
Transport:
Airports, transport hubs etc
Education:
Public and Private sector schools, sixth form colleges, universities, nurseries
Leisure:
Leisure centres, gyms, tennis and other sports centres, activity centres
Domestic:
Residential homes
Š Zenith Global Ltd 2019
2
8
Water dispense market overview
Š Zenith Global Ltd 2019
2.USA Market overview – Water dispense market evolution Commentary
400
80
350
70
300
60
250
50
200
40
150
30
100
20
50
10
0
0 2014
BWD Units
9
© Zenith Global Ltd 2019
Million $
Dispense market evolution, 2014-2018
Installed units
•
2015 POU Units
2016
2017
UTS Units
2018 Total revenue ($ mln)
2.USA Volume market evolution - Water dispense (bottled water, point of use and integrated tap) 2014
Bottled Water Dispense (BWD) Units % growth Units per '000 people Million litres % growth Point Of Use (POU) Units % growth Units per '000 people Integrated Tap Systems (ITS) Units % growth Units per '000 people Total Units % growth POU % share BWD % share ITS % share 10
Š Zenith Global Ltd 2019
2015
2016
2017
2018 14-18 % CAGR
2.USA Revenue market analysis - Water dispense (bottled water, point of use and integrated tap) •
Commentary
Water dispense revenue 2014-18 80.0 70.0 60.0
50.0 40.0 30.0 20.0 10.0
2014
11
Š Zenith Global Ltd 2019
2015
2016
2017
BWD revenue ($ mln)
POU revenue ($ mln)
UTS revenue ($ mln)
Total revenue ($ mln)
2018
2.USA Rental market analysis - Water dispense (bottled water, point of use and integrated tap) Bottled water
2017
2018
Price structure and revenue indicators
Average monthly rental ($)
•
Average bottle price ($)
Price structure and revenue indicators
Total revenue ($)
•
Commentary
Commentary
- revenue from rented units
Price structure and revenue indicators - revenue from sold units
• Mains fed point of use
2017
2018
2017
2018
Average monthly rental ($) Average sales price per unit ($) Total revenue ($) - revenue from rented units - revenue from sold units Integrated tap system Average monthly rental ($) Average sales price per unit ($) Total revenue ($)
- revenue from rented units - revenue from sold units 12
© Zenith Global Ltd 2019
Commentary
2.USA Units per capita - Water dispense (bottled water, point of use and integrated tap) USA – Units per capita 2018 Dispense type Bottled Water Dispense Point of Use Integrated Tap Systems •
13
© Zenith Global Ltd 2019
Commentary
Total Units
Units per ‘000 people
2.USA Mode of commercialisation - Water dispense (bottled water, point of use and integrated tap) Water dispense type
Mode of commercialisation •
Commentary
•
Commentary
Bottled Water Dispense
Point of Use
14
© Zenith Global Ltd 2019
Commentary
2.USA Mode of commercialisation - Water dispense (bottled water, point of use and integrated tap) Water dispense type
Mode of commercialisation •
Integrated Tap Systems
15
Š Zenith Global Ltd 2019
Commentary
Commentary
2.USA Market analysis - Water dispense (bottled water, point of use and integrated tap) Industry innovation •
Commentary
Key acquisitions and market moves •
16
Commentary
© Zenith Global Ltd 2019
2.USA History of key acquisitions and market moves - Water dispense in 2018 Examples of key acquisitions Buyer
17
Target
Š Zenith Global Ltd 2019
Type
Date
2.USA History of key acquisitions and market moves - Water dispense from 2014 Examples of key acquisitions Buyer
18
Target
Š Zenith Global Ltd 2019
Type
Year
2.USA Innovation and disruption •
Commentary and examples
Avalon – self-cleaning (ozone) POU units, sold DTC
19
© Zenith Global Ltd 2019
2.USA Forecast water dispense (bottled water, point of use and integrated tap) 2018 Bottled Water Dispense (BWD) Units % growth Units per '000 people Million litres % growth Point Of Use (POU) Units % growth Units per '000 people Integrated Tap System (ITS) Units
% growth Units per '000 people Total Units
% growth POU % share
BWD % share UTS % Š share 20 Zenith Global Ltd 2019
2019f
2020f
2021f
2022f
2023f
18-23f CAGR
18-23f %
2.USA Future water consumption trends •
Commentary
Overall water consumption, % of million litres 2018
50%
50%
Small pack
21
Š Zenith Global Ltd 2019
BWD
3
22
Bottled water dispense analysis, insights and opportunities
Š Zenith Global Ltd 2019
3.USA Bottled water dispense – Volume market analysis Bottled water dispense units, 2014-18 160 120
120
140
150
60.0
60.0
100
100 80 60
50.0
50.0 40.0
40.0 30.0
30.0
40
20.0
20
10.0 0.0 2014
2015
Market drivers and dynamics
23
70.0
70.0
0
•
80.0
Milion litres
BWD installed units
140
130
Bottled water dispense volume, 2014-18
Commentary
© Zenith Global Ltd 2019
2016
2017
2018
2014
2015
2016
2017
2018
3.USA Bottled water dispense - Market structure Throughput Litres per dispense unit 18.9l bottles per dispense unit per month Throughput •
Commentary
Cancellations •
Commentary
Contract lengths •
24
Commentary
© Zenith Global Ltd 2019
2017
2018
Cancellations Quit rate %
2017
2018
3.USA Bottled water dispense - Market analysis Features and benefits
•
BWD features and benefits %, 2018
25%
25%
Commentary
Chilled Chilled-hot
Chilled-hot-boiling 25%
25%
Other
BWD features and benefits %, 2018
30%
35%
Still Sparkling Still-sparkling 35%
25
Š Zenith Global Ltd 2019
3.USA Bottled water dispense companies - Units installed Machines in December
Company A Company B
Total market
26
Š Zenith Global Ltd 2019
2014
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
3.USA Bottled water dispense companies - Units rented Machines in December Company A Company B
Total market
27
Š Zenith Global Ltd 2019
2014
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
3.USA Bottled water dispense companies - Units sold Machines in December Company A Company B
Total market
28
Š Zenith Global Ltd 2019
2014
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
3.USA Bottled water dispense companies - Volume in million litres Million litres Company A Company B
Total market
29
Š Zenith Global Ltd 2019
2014
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
3.USA Bottled water dispense - Analysis of verticals Verticals •
POU verticals %, 2018
Commentary Workplace 20% 29%
HoReCa Healthcare
5%
Education
2% 4%
Retail Transport Hubs Domestic
10%
20% 10%
30
© Zenith Global Ltd 2019
Leisure / Gyms Others
3.USA Bottled water dispense - Analysis of leading verticals Workplace Key features and benefits •
Commentary
Specific drivers •
Commentary
Key players •
Commentary
Overall opportunity •
31
Commentary
© Zenith Global Ltd 2019
HoReCa
Healthcare
3.USA Bottled water dispense – PESTLE analysis
P
E
S
T
L
E
Political
Economic
Social
Technological
Legal
Environmental
Commentary
.
Opportunities •
32
Commentary
© Zenith Global Ltd 2019
4
33
Mains fed point of use water dispense analysis, insights and opportunities
Š Zenith Global Ltd 2019
4.USA Mains fed filtered & purified point of use water dispense - Units POU units, 2014-18 160 BWD installed units
140 120
120
130
140
150
BWD to POU conversions
100
100
2017
80 60
Replacement rate %
40 20
Number of units
0 2014
2015
Market drivers and dynamics •
Commentary
Conversion •
34
New POU
Units added
Commentary
© Zenith Global Ltd 2019
2016
2017
2018
2018
2017
2018
4.USA Mains fed filtered / purified point of use water dispense – Units Features and benefits •
Commentary
POU features and benefits %, 2018
Machine types •
Commentary
25%
25%
Chilled Chilled-hot Chilled-hot-boiling 25%
25%
Other
POU features and benefits %, 2018
30%
35% Still Sparkling Still-sparkling 35%
35
© Zenith Global Ltd 2019
4.USA Mains fed point of use distributors - Units installed Machines in December
2014
Total market 36
Š Zenith Global Ltd 2019
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
4.USA Mains fed point of use distributors - Units rented Machines in December
2014
Total market
37
Š Zenith Global Ltd 2019
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
4.USA Mains fed point of use distributors - Units sold Machines in December
Total market
38
Š Zenith Global Ltd 2019
2014
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
4.USA Mains fed point of use - Verticals Verticals •
POU verticals %, 2018
Commentary Workplace 22% 29%
HoReCa Healthcare
5%
Education
2% 4%
Retail Transport Hubs Domestic
10%
18% 10%
39
© Zenith Global Ltd 2019
Leisure / Gyms Others
4.USA Mains fed POU - Analysis of leading verticals Workplace Key features and benefits •
Commentary
Specific drivers •
Commentary
Key players •
Commentary
Overall opportunity •
Commentary
© Zenith Global Ltd 2019
HoReCa
Healthcare
4.USA Mains Fed POU – PESTLE analysis
•
P
E
S
T
L
E
Political
Economic
Social
Technological
Legal
Environmental
Commentary
Opportunities •
41
Commentary
© Zenith Global Ltd 2019
5
42
Integrated tap systems analysis, insights and opportunities
Š Zenith Global Ltd 2019
5.USA Integrated tap systems analysis ITS units, 2014-18 160 BWD installed units
140 120
120
130
140
150
ITS features and benefits %, 2018
25%
100
25%
100
Chilled
80
Chilled-hot
60
Chilled-hot-boiling
40
25%
20
25%
Other
0 2014
2015
2016
2017
2018
ITS features and benefits %, 2018
Market drivers and dynamics •
30%
35%
Commentary
Still Sparkling Still-sparkling 35%
43
Š Zenith Global Ltd 2019
5.USA Integrated tap systems - Units installed Machines in December
Total market
44
Š Zenith Global Ltd 2019
2014
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
5.USA Integrated tap systems - Units rented Machines in December
2014
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
2015
2016
2017
2018
% share 2017
% share 2018
% 18-17
Total market
Integrated tap systems - Units sold Machines in December
Total market
45
Š Zenith Global Ltd 2019
2014
5.USA Integrated tap systems- Verticals Verticals •
ITS verticals %, 2018
Commentary 10%
Workplace 10%
HoReCa Healthcare Education
10%
45%
Retail Transport Hubs
10% 10% 5%
46
© Zenith Global Ltd 2019
Domestic Leisure / Gyms Others
5.USA Integrated tap systems – Analysis of leading verticals Workplace Key features and benefits •
Commentary
Specific drivers •
Commentary
Key players •
Commentary
Overall opportunity •
47
Commentary
© Zenith Global Ltd 2019
HoReCa
Domestic
5.USA Integrated tap systems – PESTLE analysis
P
E
S
T
L
E
Political
Economic
Social
Technological
Legal
Environmental
Commentary
.
Opportunities •
48
Commentary
© Zenith Global Ltd 2019
Contact us We hope you have found this report insightful. Please help us improve our reports further by providing your feedback here To subscribe to FREE daily industry news from Zenith, please click here For further information regarding this report, or for a tailor made study specific to your requirements please contact:
Zenith Global Ltd, USA Tel: +44 (0)1225 327900 insight@zenithglobal.com www.zenithglobal.com
49
Š Zenith Global Ltd 2019
Explore our services
Global food and drink experts
Accurate, up to date global food and drinks market research and forecasting to support market strategy. Expert analysis of industry, competitors, consumers, trends, forecasts and latest product innovations. Off the shelf reports, bespoke reports, online databases.
Advice on overall strategy, business planning, entering new markets, finding contract manufacturers and distributors and having your product listed with retailers. Also, transaction services including sale mandates, target searches, valuation and due diligence.
Turnkey design and build of production facilities, site searches, manufacturing efficiency improvements, cost reduction, quality and food safety. Expertise in finding a water source, assessing water quality and volume, drilling and testing boreholes, obtaining a licence and reducing water use. Beverage formulation design and development, ingredient innovation, packaging design and advice on labels.
Global and regional industry conferences, providing detailed market insights and exclusive networking opportunities with key executives from the global food and drink sectors. Daily, weekly, bespoke news services to stay abreast of fast moving changes.
50
Š Zenith Global Ltd 2019