UK: Point of use water booming in EU
Point of use (POU) water coolers have become the latest drinking water growth phenomenon across West Europe, according to one drinks industry research group.
Zenith International said yesterday that the number of units installed leaped 35% in 2003 to 207,000. This compares with a rise of just 11% for the more established bottled water cooler industry last year.
Also known as mains-fed coolers, POU systems purify and chill mains tap water. The continuous supply concept of POU has had many converts, particularly in larger offices - where competition with bottled water coolers is most intense - as well as hospitals, schools and other sites.
"The West European POU market has more than quadrupled in the past four years," commented Zenith research director Gary Roethenbaugh. "In 2003, while the bottled cooler industry prioritised deliveries to parched offices during the summer heatwave, POU operators were concentrating on new accounts. As a consequence, 52% of new POU installations were converted from bottled cooler contracts."
With 53,500 new units installed last year, the POU sector has achieved a steady increase in its share of total cooler placements, from 5.9% in 1999 to 11.1% in 2003.
Accounting for 41% of all POU units, the UK remains the largest national market by some margin, with Zenith tracking more than 60 companies operating in Britain. France and Ireland are the other two most significant markets, each with slightly above a 10% share.
62% of POU units are based in offices; factories are the second most popular location. 2003 saw a marked swing towards intensified activity in hospitals, schools and sites run by public authorities. "Often under tight budgetary pressures, they have appreciated the long term cost savings that POU can offer", added Gary. "The in-home market, however, is still an elusive prospect for POU and bottled cooler operators alike."
Strong demand for POU can be attributed to a number of factors. Greater economic stability has provided the foundation. The hot summer of 2003 was a major driver. Intensified sales and marketing activity has heightened awareness.
"POU has become a major opportunity area for budding entrepreneurs and now presents an emerging challenge to the bottled water cooler industry," concluded Roethenbaugh.
Zenith said it forecasts compound annual growth of over 20% up to 2008, taking the number of POU units close to 600,000. But with sustained marketing investment and, if POU effectively penetrates the in-home opportunity, this target could well prove conservative, it added.
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