to see a sample prospectus.

Transcription

Baytel
NOW
WITH 2014
MARKET
UPDATES
Associates
THE MARKET FOR HOME WATER
TREATMENT PRODUCTS & SERVICES
in Mexico
Unilever Attacks Bottled Water Head On
…With an Appliance!
A carefully planned and executed assault on the global bottled water
business by an FMCG giant, Unilever, has been converting high-volume bottled water customers into users of inexpensive in-home water
storage, purification and dispensing appliances in a major segment of
the world’s most important bottled water market.
—Baytel Associates
“ Baytel’s residential water treatment reports have been
valuable in our market assessment activities, particularly
due to the detail provided from having experienced
people on the ground actually investigating the market
dynamics.”
—Siri Gawrisch
Global Market Intelligence Leader
Dow Water & Process Solutions
New Market Updates in 2014
Baytel Associates announces the immediate availability of its updated
report on the Market for Home Water Treatment Products and Services in Mexico.
 Products, Brands, Prices, Claims and Photos
 The Bottled Water Alternative: Under Attack
 Distribution Channels: Existing and Potential
 Product Use in the Home
 Issues & Drivers
 Quantitative Market Analysis, Segmentation, and Shares
 Business Profiles of Key Companies
Another recent quote about Baytel’s reports:
“ Worth the expense.
Original research and
insightful analysis.”
Global Marketing Manager
Residential Water Filtration
3M Purification Inc.
“Detailed, factual and authoratative—like everything Baytel does.”
Copyright © 2014 by Baytel Associates. • www.baytel.org • for more information +1-732-988-6792 or [email protected].
Page 1
Baytel
Associates
Baytel’s insightful analysis explores the
global resonance of a new realization…
“ Dragging around heavy 5-gallon jugs of water is
simply old fashioned drudgery”
Unilever’s “appliance attack” on the 5-gallon (9-liter)
bottled water business of PepsiCo, Danone, CocaCola, Nestlé and others could have far reaching consequences. What will it lead to? Where will it end?
Order Baytel’s new report on the Mexican Market for
Home Water Treatment Products & Services and find
out.
“ Baytel’s POU water treatment market research reports provide far more detail and
actionable insights than what can typically
be obtained from reports from other suppliers.
Although certainly providing the big picture,
Baytel goes beyond mere high-level overviews
to provide a level of granularity and a depth
of understanding that yields real dividends.
Baytel is also quite flexible in responding to
specific requests in new reports.”
Understand why certain types of consumers are now
switching to inexpensive appliances that convert ordinary tap water into a safe, convenient, natural tasting,
and less expensive alternative to bulk bottled water.
—Duane Dunk
Formerly with KX Technologies,
Seldon Technologies, and
Halosource
Baytel’s analysis shows what portion of the global bottled water market is
vulnerable to an “appliance attack”
Page 2
Baytel
Associates
Baytel’s report is of crucial importance to senior executives
involved with corporate strategy for bottled water and/or
in-home drinking water treatment products (water filters or
purifiers used by consumers).
Understanding this business risk is crucial
to PepsiCo, Danone, Nestlé, and CocaCola, as well as other major bottled water
firms and IBWA. Where will this all end?
Will the factories and retailers that now
fill 19-liter jugs with purified water be
replaced by appliances making “ bottled
water” out of tap water at home? Will
these be “post-mix” drinking water appliances supplied by a major bottled water
company?
Page 3
Baytel
Associates
A THING OF THE PAST?
Baytel’s report provides
in-depth business profiles
of the key players
Baytel’s report provides in-depth business profiles of key players in the Mexican market.
 Understand who’s who in this crucial arena—as
well as who’s supplying whom!
 Understand the players and seize the best opportunities
for YOU!
This report explains exactly what
Unilever’s home water treatment appliance is, how it works, who it appeals to,
and what it costs…
Understand how the cost of goods in Unilever’s Pureit was
kept low enough, and yet the technology effective enough,
to enable product positioning at prices compelling enough
to convert important classes of bottled water consumers into
home appliance uses. Learn how far Unilever will be able to
reduce its prices if need be and still be profitable once the
Pureit line is manufactured in Mexico.
Copyright © 2014 by Baytel Associates. For more information or to order contact Matt Moes at +1-732-988-6792. www.baytel.org
Page 4
Baytel
Associates
Baytel’s new report also highlights
strengths and weaknesses of the key
Mexican player, Rotoplas
The report explains the “value
proposition” of Unilever’s appliance vis-à-vis jugs of bottled water
Understand exactly how Unilever—with the right product and a sustained first-rate advertising campaign—is
achieving a paradigm shift on the part of Mexican consumers: how Unilever is getting them to replace jugs of
bottled water with its home water treatment appliance,
the Pureit.
Some of the local players in Mexico are not naïve or
unsuccessful, doing hundreds of millions of dollars
of business in residential and commercial water
storage, “purification,” piping, and pumping.
Rotoplas, for example, is believed to be Pentair
Residential Filtration’s largest customer in the
Americas.
But Rotoplas has positioned its “filters” and
“purifiers” as a “system for better water”
sold in conjunction with its water tanks. Is this still
the best approach to be taking?
Can Rotoplas do this too? Can you?
Order Baytel’s new report today and find out how Rotoplas and others
could take a lesson from the global bottled water giants and better
position their products to enhance sales.
Page 5
Baytel
Associates
This crucial strategic resource spells out opportunities for both current &
potential players
3M, A.O. Smith, Ahlstrom, American Standard, Amway, Angel, Aquion, Aquionics, Asahi Kasei, Brita
GmbH, Cemix, Clorox, Coca-Cola, Culligan, Danaher, Danone, Delta, DSM, Dow, Emerson, G.E.,
Haier, Halma, Halosource, Helen of Troy, ICL (Medentech), IUSA, Kemflo, Kinetico, Kohler, LG, Marmon (KX, Ecowater), Mexalit, MicroFilter, Midea, Mitsubishi Rayon, Moen, Multipure, Nestlé, Omnipure, Pentair, PepsiCo, Qinyuan, Reckitt-Benckiser, Rotoplas, Samsung, Seldon, Sensor Electronic Technology (SETi), Strauss Water, Tata Chemical, Toray Industries, Toto, Tupperware, Unilever, Watts,
Waterlogic, Whirlpool, Woongjin Coway… and many more!
Market segmentation
Learn how the market breaks down by product type or configuration, by region, by distribution channel, and by
systems versus consumables. Get the data you need on unit shipments, market values and company shares.
What you need to know
about replacement cartridges
This is a “razor blade” business; Unilever and
Rotoplas both understand this every bit as
well as Gillette does. A grasp of the key variables here is crucial and this report tells you
what you need to know.
Could Unilever’s TV ads for
Pureit in Mexico be GREATLY
improved, at a nominal cost?
Unilever’s ad agency has done a fantastic job
featuring Martha Debayle and explaining the
value proposition of Pureit. However these ads
fail to leverage something absolutely critical.
Meaningful projections of growth in the Mexican market
This is an industry in transition! Two and five-year market forecasts are provided,
and the market projections are meaningful, not rote. Baytel factors specific past, recent,
and anticipated developments in the market into its market projections, taking into
account the underlying technologies involved, and making specific assumptions as to
when different kinds of companies will participate in this market.
Page 6
Baytel
Associates
Order Baytel’s definitive Mexico study TODAY!
Beat Your Competition to the Punch
Order this valuable new information product today while it’s still hot off the press!
Explains why certain classes of consumers are switching from bottled
water to an appliance
It is important to know where—and with what types of consumers—change is taking place
in response to the ads being run.
Know the technology & value chain of Unilever’s Pureit and its cartridges
Understand how Unilever was able to patent an age-old water disinfection technology used by municipal water
utilities all over the world and use it to significantly lower the Pureit’s cost of goods. Discover the startling margins
for Pureit and its periodically purchased replacement cartridges that both filter and purify the water.
Page 7
Baytel
Associates
DON’T DELAY: ORDER TODAY!
Provides quantitative data on how Mexican
consumers think about—and what they are
doing about—drinking water in their homes
The Baytel report provides valuable quantitative data about what Mexican consumers are doing in terms of drinking water, by socio-economic class, and by region of the country.
Explains why Mexicans are such heavy users
of bottled water
Water quality in Mexico is a political hot potato, but Baytel’s report
comes through with the information needed. Credible suppliers on
the one hand—and the absence of them on the other—have shaped
approaches to drinking water in Mexican homes over generations.
Page 8
Baytel
Associates
The report examines crucial issues facing the
bottled water giants
Is the US$2 billion market for 5-gallon jugs of bottled water in Mexico
just the first domino in a chain? To what extent is what Unilever is
doing with Pureit in Mexico and Indonesia going to work in other
bottled water markets? What’s unique about the Mexican market?
Explores who is buying Rotoplas’s solution,
and where they are buying it
Understanding who is buying Rotoplas’ solution to the problem and
where they are buying it is important because it sheds light on the
water storage issue, as well as on distribution options
This “must-have” report includes
hundreds of original Baytel
photos
The Baytel Report is informatively illustrated with numerous original high-resolution photos taken by Baytel Researchers in
Mexican retail chains, in Mexican “Mom
& Pop” Shops, and in Mexican homes of all
socio-economic classes. High resolution copies
of all photos are on the CD with your report,
plus some useful bonus files.
Benefit today from Baytel’s decades of
experience investigating the Mexican market
for home water treatment products and
services
This report is built on Baytel’s decades-long experience analyzing the
home water treatment market in the field in Mexico—and in over
45 other countries around the world. Baytel principals each spend
months out of the year engaged in on-site, in-country research.
The report explores the impact of partnering
with specific retail chains in Mexico on your
overall distribution in Latin America
When partnerships are forged with specific retail chains in Mexico
there are major implications for your distribution in Latin America as
a whole. This key issue is explored in detail, and the best possible partners for distribution are highlighted.
Benefit immediately from this valuable
information product: Complete and Send the
attached Order Form to Baytel TODAY!
Now Shipping,
Immediate Delivery!
To Order: email [email protected].
Or telephone Baytel Associates at
+1-732-988-6792.
Or reach Baytel’s Marketing V.P.
➤ See the detailed Table of Contents below.
on his mobile +1-732-306-2705.
Page 9
Baytel
Associates
➠
SAMPLE PAGES
➠
TABLE OF CONTENTS
➠
ABOUT BAYTEL
Pureit and its marketing campaign
should be considered an opening salvo
in what will doubtless be a protracted
struggle for the C +, C, and D+ demographics, between bulk bottled water
and modern home water treatment
options.
Page 10
Baytel
Associates
TABLE OF CONTENTS & SAMPLE PAGES
■ Executive
Summary
■ Introduction,
Scope &
Methodology
■ Drinking
Water in
Mexico
■ Bottled Water
in Mexico
■ Issues &
Drivers
■ Products,
Br ands, &
Prices
■ Distribution
Channels
■ Use in the
Home
THE
MEXICAN
MARKET FOR
HOME WATER
TREATMENT
PRODUCTS
AND SERVICES
■ Quantitative
Analysis
■ Key Market
Participants
A Market Research & Analysis Report
by Baytel Associates
■ About Baytel
■
■
■
■
■
■
■
■
■
■
■
203 edition
with 204 market updates
Copyright © 2014. Baytel Associates • PROPRIETARY & CONFIDENTIAL • Dissemination prohibited. www.baytel.org
Baytel
Associates
Table of Contents
TABLE OF CONTENTS
Title Page ............................................................................................................................................. i
Summary of Terms......................................................................................................................................ii
Terms of Agreement ...................................................................................................................................iii
Table of Contents ....................................................................................................................................... iv
Section 1. Executive Summary .......................................................................................................... 
Scope and Methodology .............................................................................................................................. 2
The Country of Mexico (A Few Important Statistics) .................................................................................. 2
Water Availability and Quality .................................................................................................................... 3
Water Availability .................................................................................................................................. 3
Water Quality ....................................................................................................................................... 4
Bulk Bottled Water ..................................................................................................................................... 5
Market Issues and Drivers ...........................................................................................................................6
Opportunities ......................................................................................................................................0
Products Currently Available ...................................................................................................................... 
Product Distribution .................................................................................................................................. 
Product Use in the Home ...........................................................................................................................2
A $170 Million Market, Predicted to Double Quickly................................................................................ 3
Who’s Who (and Who is Doing What) in the Mexican Market ................................................................. 3
Section 2. Introduction, Scope & Methodology ..............................................................................4
The People of Mexico ................................................................................................................................. 5
The States of Mexico ................................................................................................................6
Major Mexican Cities ...............................................................................................................7
The Mexican Economy...............................................................................................................................8
Physical Environment.................................................................................................................................9
Mexico’s Human Development Index by State .........................................................................9
Scope ........................................................................................................................................................ 20
Methodology ..............................................................................................................................................2
…continued…
For more information or to order contact Matt Moes, +1-732-988-6792. [email protected]
Page 12
Baytel
Associates
Table of Contents
Section 3. Drinking Water in Mexico ............................................................................................. 22
Water Availability .......................................................................................................................................23
Hydrological Regions of Mexico ............................................................................................. 24
Utility Outages ......................................................................................................................................... 24
Surface and Groundwater ...........................................................................................................................25
Pollution Levels in Surface Waters ............................................................................................25
Infrastructure Improvements ..................................................................................................................... 26
Water Quality: The Hidden Reality ....................................................................................................... 27
How Mexicans Think About Drinking Water ....................................................................................... 28
Sources of Household & Drinking Water .............................................................................................. 30
Bulk bottled water may be delivered or picked up at a store ..................................................... 30
A storage tank and filling station for water tankers ................................................................... 3
Two Specific Water Quality Problems ........................................................................................................ 3
Water Quality Standards ............................................................................................................................32
Comparison of Mexican and U.S. Primary Water Quality Standards ....................................... 33
Comparison of Mexican Standards and U.S. Secondary Standards ..........................................38
Post-Treatment Contamination ..................................................................................................................39
Residential Equipment Standards ...............................................................................................................39
Water Hardness .........................................................................................................................................40
Section 4. Quantitative Analysis of Bulk Bottled Water in Mexico ...............................................4
Bulk Bottled Water Consumption ............................................................................................................. 42
Traditional bulk bottled water ................................................................................................. 42
Smaller bottles of bulk bottled water ....................................................................................... 42
Smaller bottles not covered in this report ................................................................................ 42
Brands ....................................................................................................................................................... 44
A bottling plant (for the dominant bulk bottled water brand) ................................................. 44
“Mom & Pop” retailers purify water and refill bottles for pickup or delivery ............................45
Distribution .............................................................................................................................................. 46
Retail Distribution .............................................................................................................................. 46
Bulk bottled water at retail ...................................................................................................... 46
Home Deliveries.................................................................................................................................. 47
Bottled Water Deliveries.......................................................................................................... 47
A Neighborhood Refilling & Delivery Business (Operational & Pricing Details) ................................ 48
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Table of Contents
Bottled Water Demographics .................................................................................................................... 50
Garrafón Use in the Most Relevant Household Classes, by Class and Region...................................... 50
Who Is Switching to Appliances? ........................................................................................................ 50
Dispensing Bottled Water .......................................................................................................................... 5
Refrigerator Dispensers for Bottled Water ............................................................................................52
Bottled water dispensing from a refrigerator .............................................................................52
Section 5. Issues, Drivers & Opportunities ..................................................................................... 53
Introduction .............................................................................................................................................. 54
What Mexican Consumers Are Currently Doing About Their Water .................................................. 54
Who Does Pureit Appeal To? .............................................................................................................. 56
Issues Facing Bottled Water Companies ................................................................................................ 57
How Serious Is the Appliance Threat? ................................................................................................. 57
To What Extent Does This Threat Extend Beyond Mexico ........................................................... 57
Should We Fight This or Join In? .........................................................................................................58
Is There a Profitable Adjacency Here? ...................................................................................................58
Factors Constraining Growth in the Demand for Home Water Treatment Products..........................60
A Bottled Water Culture .....................................................................................................................60
Extent of Advertising............................................................................................................................6
More on Bottled Water Advertising ..................................................................................................... 62
Groupe Danone’s Advertising for Its Main Bulk Bottled Water Brand in Mexico .......................... 63
Coca-Cola’s Advertisements for Its Main Bulk Bottled Water Brand in Mexico ............................ 64
Until Recently, an Absence of Credible Suppliers of Water Purifiers ............................................. 64
Home Water Treatment Equipment Suppliers Lacking Credibility ................................................ 65
A Missed Opportunity .................................................................................................................. 66
Rotoplas/Filtroplas: Close but No Cigar (This Could be Rectified) ......................................... 66
Unilever: The New (and First Wholly Credible) Supplier ......................................................... 66
A Lax Regulatory Environment ........................................................................................................... 67
Problematic Water Conditions............................................................................................................. 69
…continued…
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Baytel
Associates
Table of Contents
Factors Driving Growth in the Home Water Treatment Market .......................................................... 70
Water Scarcity and At-Home Storage of Water .................................................................................... 70
Water Quality ..................................................................................................................................... 70
Consumer Awareness ...........................................................................................................................7
Awareness of Credible Alternatives to Bottled Water ...................................................................... 72
Unilever’s TV Advertisements for Pureit in Mexico ....................................................................... 73
A screen shot from one of Unilever’s advertisements ................................................................ 74
Reducing a Consumer’s Risk: Rentals or Installment Payments .................................................... 74
Manufacturing in Mexico Versus Exporting to Mexico ...................................................................75
Import duties .................................................................................................................................75
Transportation and Logistics ......................................................................................................... 76
Value Added Tax ........................................................................................................................... 77
Service and Support ............................................................................................................................ 77
Intellectual Property ............................................................................................................................ 78
Opportunities .......................................................................................................................................... 79
A Marketing Lesson From a Related Industry ..................................................................................... 79
Positioning Water Purifiers .................................................................................................................. 80
Offering Options that Certain Consumers Can Aspire To .................................................................. 80
Offering Convenience ......................................................................................................................... 80
Positioning Products as Solutions to Problems ......................................................................................8
The Role of Temperature ......................................................................................................................8
Building Distribution .......................................................................................................................... 82
Structure of the Retail Industry in Mexico .................................................................................... 82
Where to Sell Home Water Treatment Systems in Mexico ...............................................................83
Who to Partner With?........................................................................................................................85
What You Need To Know About Replacement Cartridges .................................................................. 86
Essential Consumer Feedback ....................................................................................................... 86
They Should Be Easy To Replace and Dispose Of ......................................................................... 86
What They Should Cost ................................................................................................................ 87
How Long They Should Last ......................................................................................................... 87
…continued…
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Table of Contents
Getting Retailers to Stock Replacement Filter Cartridges .................................................................... 87
Manufacturers of Rooftop Water Tanks .............................................................................................. 89
Housing Developers ............................................................................................................................ 89
Refrigerator Manufacturers ................................................................................................................. 90
Faucet Manufacturers.......................................................................................................................... 90
The Direct Sales Opportunity ...........................................................................................................9
Amway ...........................................................................................................................................9
Tupperware, Elken, Coway, Vorwerk (Lux) and Others? ................................................................9
Reducing the Consumer’s Perceived Risk (Warranties, etc.)................................................................. 93
What does this report on the Mexican Market for home water solutions offer YOU? ................... 93
A Huge Opportunity for Companies like 3M, PepsiCo, Coca-Cola, Nestlé, Danone, Unilever,
Clorox, Brita GmbH (Mavea), ICL (Medentech), Rotoplas, Woongjin Coway, Philips,
Tupperware, KX, Haier-Strauss Water, Tata Chemical, Pentair, Kemflow, Microfilter, Filtrex,
Halosource, Helen of Troy (Kaz’s Pur/Honeywell), Reckitt-Benckiser, Midea, LG,
Haier-Strauss Water, Seldon, Whirlpool, Waterlogic, Watts, and Others .................................. 93
Section 6. Products, Brands & Prices...............................................................................................95
The Most Common System Types ............................................................................................................. 96
Traditional Countertop Units .............................................................................................................. 97
Prices ............................................................................................................................................ 98
Brands ........................................................................................................................................... 98
Under-Sink Systems ............................................................................................................................ 98
Prices ............................................................................................................................................ 98
Brands ........................................................................................................................................... 99
In-Line, Tank-Attached, or POE Filtration Systems ............................................................................ 99
Other Product Types ........................................................................................................................... 99
Other Countertop Systems ............................................................................................................ 99
Refrigerator Water Dispenser Filters ............................................................................................ 00
Wall-Mounted Systems ............................................................................................................... 00
End-of-Faucet Systems ................................................................................................................ 00
…continued…
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Table of Contents
Related Product Categories....................................................................................................................... 0
Rooftop Water Tanks ......................................................................................................................... 0
Do households from all demographics use rooftop tanks? ...................................................... 0
Older Tanks ........................................................................................................................... 0
A truck carrying 42 new rooftop tanks.................................................................................. 0
Plásticos Antibacterias ............................................................................................................02
Modern Control Valves ..........................................................................................................02
Water Disinfecting Drops or Tablets ..................................................................................................02
Various Disinfecting Drops and Tablets ................................................................................. 03
Where These Products are Distributed ...................................................................................04
An Incredible Opportunity for Medentech ...................................................................................04
Dispensers for Bottled Water .............................................................................................................. 05
Hot and Cold? ....................................................................................................................... 05
Section 7. Product Distribution ...................................................................................................... 06
Major Distribution Channels ...................................................................................................................07
Department Stores ...................................................................................................................................07
Downtown Versus Suburban ..................................................................................................07
On Display at Sears ................................................................................................................08
Another Key Player’s Products at Sears ...................................................................................08
Products and consumables......................................................................................................08
A filtering dispenser and non-filtering dispensers ....................................................................08
Liverpool stores in urban and suburban malls ........................................................................09
The Newcomer at Liverpool ...................................................................................................09
Locally Manufactured Ozonators at Retail .............................................................................09
Construction Materials Stores .................................................................................................................. 0
A Key Display at a Mexican Home Depot Store ..................................................................... 0
Other Brands and Generics at Home Depot ............................................................................
Water Treatment Products at Construrama .............................................................................
Products Carried by Ferretería el Centanario ...........................................................................
…continued…
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Baytel
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Table of Contents
Hardware & Plumbing Supply Stores ....................................................................................................... 2
Generic and Branded Equipment ........................................................................................... 2
Key Products on Display at Pevi Global Plumbing Supply .......................................................3
Two Other Configurations Encountered .................................................................................3
Siemens Water Purifiers?......................................................................................................... 4
This Hardware Store Carries Filters, Purifiers, and Tanks ....................................................... 4
Hardware and Appliances in Central Mexico City ..................................................................5
Hypermarkets & Warehouse Clubs .......................................................................................................... 6
Products Carried by Costco.................................................................................................... 6
Products Carried by Chedraui Selecto and Soriana................................................................. 6
Products Carried by Walmart and Sam’s Club........................................................................ 7
Other Channels ....................................................................................................................................... 7
Products Being Sold Using Direct Sales .................................................................................. 7
Section 8. Product Use in Homes ................................................................................................... 9
Household Visits & Photos ......................................................................................................................20
Homes in the A/B Income Group ..........................................................................................20
Representative Household One (C+ Income Group) .......................................................................... 2
Household 1. Exterior Views .................................................................................................. 2
Household 1. Ground level water storage ................................................................................ 2
Household 1. Two new rooftop tanks ..................................................................................... 22
Household 1. A third tank and a tanque estacionario for gas ................................................... 22
Household 1. Garrafones of water and a pump ....................................................................... 22
Household 1. Ten-liter jugs..................................................................................................... 22
Household 1. View of the kitchen........................................................................................... 22
Household 1. What’s used with the ice maker ........................................................................ 23
A Similar Ice Maker Filter at Home Depot ............................................................................. 23
Representative Household Two (C+ Income Group) ..........................................................................24
Household 2. A filter for ice and a pour-in dispenser for chilled water ....................................24
Household 2. Water dispenser on the refrigerator door ...........................................................24
Household 2. View of the living room ....................................................................................24
Household 2. Garrafones........................................................................................................24
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Baytel
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Table of Contents
Representative Household Three (C+ Income Group) ........................................................................ 25
Household 3. The undersink filter with tap ............................................................................ 25
Household 3. Closeup of the filter .......................................................................................... 25
Household 3. View of the kitchen .......................................................................................... 25
Household 3. View of the living room .................................................................................... 25
Representative Household Four (C Income Group) ............................................................................26
Household 4. Exterior view and propane tanks ......................................................................26
Household 4. Views of the kitchen .........................................................................................26
Household 4. Bottled water dispenser.....................................................................................26
Household 4. Outdoor laundry or utility sink ........................................................................26
Household 4. Living room ..................................................................................................... 27
Household 4. A bedroom ....................................................................................................... 27
Representative Household Five (C+ Income Group) ........................................................................... 28
Household 5. Exterior view and propane tanks....................................................................... 28
Household 5. Views of the water purifier in the kitchen ......................................................... 28
Household 5. Dining room .................................................................................................... 28
Representative Household Six (C+ Income Group) ............................................................................ 29
Household 6. Exterior view (backyard)................................................................................... 29
Household 6. Both a purifier and a bottled water dispenser .................................................... 29
Household 6. The dining room and living room..................................................................... 29
Representative Household Seven (D+ Income Group) ........................................................................ 30
Household 7. Exterior view..................................................................................................... 30
Household 7. Spare garrafones ................................................................................................ 30
Household 7. The living room and bathroom ......................................................................... 30
Household 7. Outdoor laundry or utility sink......................................................................... 30
D- and E-Income Group Housing.......................................................................................................3
Typical D and E exteriors ........................................................................................................3
A shared outdoor laundry sink ................................................................................................3
Occasional bottled water use ...................................................................................................3
Discarding washing water .......................................................................................................3
Page 19
Baytel
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Table of Contents
Section 9. Quantitative Market Analysis [2014 edition]............................................................. 32
Scope ........................................................................................................................................................33
Installed Base ............................................................................................................................................33
Distribution of the Installed Base by Region...................................................................................33
Current Systems Sales ............................................................................................................................ 34
The Market in Units Sold ................................................................................................................... 34
Distribution of Units Sold ...................................................................................................... 34
Breakdown of Current Systems Sales by Technology .............................................................. 34
The Systems Market in Dollars ............................................................................................................35
Weighted Average System Prices ..............................................................................................35
Units Shipped by Type or Configuration .................................................................................35
The Systems Market in Dollars by System Type ..................................................................... 36
Systems Sales by Channel ................................................................................................................... 36
The Systems Market in Dollars by Type ................................................................................. 36
Systems Sales in Units by Channel ......................................................................................... 37
Consumables & Service ......................................................................................................................... 37
Annual Consumables and Installation Expenditures by System Type ..................................... 38
The Current Combined Market................................................................................................................ 38
The Total Market by Type (Million $).................................................................................... 38
The Total Market ................................................................................................................... 39
Market Forecasts in Units ...................................................................................................................... 39
Systems Sales Forecasts (Thousand Units) ..............................................................................42
Systems Sales in Units ............................................................................................................42
Market Forecasts in Dollars................................................................................................................... 43
Systems Sales Forecasts (Million $) ........................................................................................ 43
Consumables Market Forecasts ................................................................................................................44
Consumables, Installation, and Maintenance Forecasts (Million $) ........................................44
The Combined Market ............................................................................................................................. 45
Combined Market Forecasts (Million $) ................................................................................ 45
Market Shares ..........................................................................................................................................46
Market Shares of the Leading Players .....................................................................................46
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Table of Contents
Section 10. Key Market Participants .......................................................................................... 47
Supplier Industry Structure ......................................................................................................................48
In-Depth Business Profiles of Key Players and Other Interesting Firms .............................................152-230
[over 75 pages of valuable information on relevant companies, including potential
partners providing in-home services like installation & filter change-outs]
Page 21
Baytel
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Section 3. Drinking Water in Mexico
SamplePage
WATER QUALITY: THE HIDDEN REALITY

Detailed geographical maps of water quality throughout Mexico exist but the data
are hard to evaluate as water quality is (still) considered a political “hot potato.”
For both surface and ground water, the major contamination problem is microbiological. Surface water problems include fecal coliforms, grease and oil, orthophosphates,
dissolved solids, total solids, chlorides, nitrates, nitrites, and color. Groundwater problems include xxxxx xxxxxxxx, xxxxxx xxx, xxxxxx, xxxxx and xx, xxxxx, xxx xxxxxx,
xxxx, xxxxxx, and xxxxxxxxxx. The biggest problem for water for agriculture is xxxx
xxxxxxxxx.

Many water quality contaminants that are regulated in more developed countries
remain unregulated in Mexico. Even if they are regulated, enforcement of the
regulations is, at best, highly uneven.
The quality of the water coming from the municipal treatment plants varies with the
availability and use of water treatment chemicals, with the condition of the (notoriously
leaky) water distribution infrastructure, and with the conditions under which it is stored
in the home.
Xxxxxxx and Xxxxxx xxxxxxx are prominent causal agents of the diarrheal diseases
encountered, and have been a leading cuase of infant mortality in Mexico. Xxxxx xxxxxxxxx has been endemic and there have been epidemics of xxxx. Xxxxxx spp, Xxxxxx
spp, Xxxxxxxxx xx, Xxxxx xxxxxxxxxx, and E. coli are said to be frequently transmitted
by polluted water in Mexico.
Mexico City tap water has suffered from low compliance with standards for xxxxxx
xxxxxx, xxxxxxx xxxxxxxxx, xxxxxxxx, xxx xxxxxxx xxxx, and relatively high turbidity.
It is likely that water in other cities and in rural areas suffer from similar, if not often
worse, problems.
Household water storage tanks are often found open and uncleaned, thus pemitting
xxxxxxxx xxxxxxxx xxxxx xxxxxx more rapidly and encouraging the growth of microorganisms.
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Baytel
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Section 4. Bottled Water in Mexico
SamplePage
to offices, foodservice and lodging businesses, other
commercial and institutional establishments, and
industrial facilities.
Bottled water consumption is strongly culturally
entrenched among Mexican consumers in all but
the very lowest income levels. (See “Bottled Water
Demographics” below.) However, the degree to
which bottled water is used for common household
tasks is quite variable. Of course, all consumers who purchase bulk bottled water use it
for at least some of their drinking water; but more than xxxx of them also use it for cooking; over xxxx use it when brushing their teeth; about xxxx use it for washing fruits and
vegetables that will not be cooked; and about xxxx use it for dish washing or rinsing.
Bottled water use is also regionally variable, depending on local perceptions of tap water
quality and generational habits of bottled water use versus other water purification
options—for example, the popularity of disinfecting drops and tablets in xxxxxxx.
Price per garrafón tends to fall within two groups: branded water usually costs xxx pesos
or more per 9-liter bottle; water from neighborhood or small local producers generally
costs less than xx pesos. Within these ranges, it is sometimes possible to find a garrafón
price of as little as xx pesos ($xxx) for a store front producer, or as much as xxx pesos
($xxx) for a major brand’s garrafón at a high-end outlet.
About half of all bottled water sold in Mexico each year is from smaller firms. Since this
figure includes so-called individual serving sizes of less than 0 liters, and since the major
brands (Electropura/E-pura, Bonafont, and Ciel, etc.) predominate in the individual
servings sector, the share of bulk bottled water from small or neighborhood firms is significantly higher than xx%. This also reflects the fact that most of the bulk bottled water
sold in Mexico (by volume) is sold into households of the x, x+, and x groups where cost
per garrafón is xxx xxxxxxx xxxxx.
On an average nation-wide basis, household consumption among households that use
bulk bottled water is about xxx garrafones per household per month—the equivalent of
about xxx liters per person per month—costing about xxxx pesos ($xxx) per month.
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Baytel
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SamplePage
Most neighborhood manufacturers supply only xx-liter sizes, and while some are properly run and administered, others are more casual.
“Mom & Pop” retailers purify water and refill bottles for pickup or delivery

It should be noted that although most manufacturers, whether large or small,
require an initial deposit on the first bottle when a consumer begins purchasing
water, or even the outright purchase of the first bottle (in addition to the water),
there is very little control over where the bottles end up. Local manufacturers
therefore often clean and fill bottles with labels from other manufacturers, so that,
for instance, an Electropura bottle or a distinctive Bonafont bottle in a consumer’s
home may actually have been refilled with water produced by some other firm. The
seal on the bottle, however, may reveal the true source.
Page 45
Baytel
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SamplePage
A Neighborhood Refilling & Delivery Business (Operational &
Pricing Details)
Baytel recently interviewed the owner of a small neighborhood water bottling and refilling operation in Mexico City. The company has been in business for about xx years and
has only one location. Two people work for the company: one washes and fills bottles,
the other is in charge of deliveries.
The shop is open Monday to Friday from 9 AM to 6 PM and on Saturdays from 9 AM to
2 PM. They deliver about xx garrafones each week using a bicycle specially adapted for
carrying them.
The water that the company purifies comes from a well in Naucalpan, Estado de Mexico
(where many private water delivery companies get their water), and is brought to them
by tanker truck. They get xxxx liters per tanker, and, depending on the season, might get
xxx xxxx per week or one every xx days. The bottler pays xx pesos (about $xx) for each
delivery (including the water).
The company uses the following treatment procedures: filtration (sediment and activated carbon), chlorination, UV and ozone, and has not changed these procedures since
beginning the business. The company spends about xxxx–xxxx pesos ($xxx–$xx) for
consumables and replacement parts each year, plus xxx–xxx pesos for electricity each
month. Salaries for the two workers total about xxx pesos ($xxx) per month. There are
periodic government inspections, and the company must keep its permits up to date.
The company has xxx accounts. About xx% of its business is via delivery; the other xx%
represents bottles picked up by the customer. A garrafón of water costs the consumer
xxx pesos ($xx) and there is a x-peso charge for delivery. This does not include the bottle
itself, which the customer must provide. Usually, of course, the customer returns an
empty bottle and picks up a full one.
According to the owner of the business, there are xx similar operations within a xx kilometer radius. According to one study, there were about xxx such businesses in metro
Mexico City in xxx. The number today might be xxx times higher.
Page 48
Baytel
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SamplePage
BOTTLED WATER DEMOGRAPHICS
WHILE THE VAST MAJORITY of consumers in the xx and xx+ demographics are heavy users
of bulk bottled water, it should not be assumed that families with xxxxxx incomes—and
even those with xxxxxx incomes—never use bulk bottled water. Although there are
strong regional differences, about xx% of xxxxxx households use (bulk) bottled water as
drinking water.
Garrafón Use in D-class to C-class Households by Region
According to recent survey data (xx xxxxxx xxx
xxxxxxx
xxx)
urban
��
��
x, x and x households
reported the following
��
��
differences by city among
��
��
households who do not
��
drink tap water (xx% of
��
respondents). The num-
��
��
��
��
ber shown is the percent
��
of households not drink-
��
��
��
��
��
��
ing tap water that do use
garrafones.
��
��
Baytel
Associates
Who Is Switching to Appliances?
The people switching to home water treatment appliances include xxxxx xxxxx xxxxxx
xxx xxxxx who are dissatisfied with xxxxx and xxxxxx (xx xxxx xxx xxxxx). There is also
growing concern about the xxxx xxxxxx xxx, with almost half of consumers expressing
some (albeit usually small) degree of suspicion.
A growing number of Mexican consumers also have concerns about xxxxxx issues related
to xxxxx xxxxx water xxxx xxxxxxx xxxxx xx (xxxxxxxxx xx xxxx xxxxx xxxxxx xxxxx
Page 50
Baytel
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Section 5. Issues, Drivers & Opportunities
SamplePage
About xx% of the volume of bottled water consumed today in Mexico is packaged in
xxx- and xxx liter bottles. These sell for an average of xxx pesos per gallon ($xxx per gallon or $xxx per liter).
In terms of volume, the heaviest users of the garrafones are xxxxxx xxxxx households.
Over xxxxx (xx%) of these households use water straight from the tap for cooking, and
xx% of them consume water straight from the tap for drinking. However xx% of them
also purchase bottled water, xx% boil their tap water, xx% disinfect their tap water, and
xx% filter it.
On average these homes consume xx garrafones per month (which translates to about
xx liters per person per month) and each household spends an average of xx pesos (about
$xxx) per month for this. Between their monthly water and sanitation bill (which averages about $xxx) and their monthly outlays for bulk bottled water, these households are
spending nearly $xx per month or $xx a year on household water.
Mexico accounts for an estimated xx% of the world’s bottled water market. Bottled
water in Mexico was a xxx billion gallons per year business in 202, of which about xx%
of the volume is x- to x liter garrafones. This translates into about xxx billion gallons a
year or the equivalent of about xxx billion 9-liter garrafones per year. The industry has
been growing at about x% per year. So we can assume that the 203 market was equivalent to about xx billion 5-gallon garrafones. The average price per 5-gallon garrafón is
about xxx pesos ($xxx) so we are estimating a $xxx billion market for 203.
Dissatisfaction with the cost and inconvenience of using heavy, unwieldy 9-liter garrafones of water is much of what drives the Mexican consumer to seek an alternative
solution to the problem of providing safe, good tasting drinking water to his or her
family. Nonetheless, until now there really hasn’t been an alternative to bottled water
that Mexican consumers consider acceptable. This has resulted in a very strong “bottled
water culture.”
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Baytel
Associates
Section 5. Issues, Drivers & Opportunities
SamplePage
Getting Retailers to Stock Replacement Filter Cartridges
Ideally, the replacement filter cartridges for successful products should also be available
at supermarkets and convenience stores that do not even sell the systems they are used
in. Where should one turn to for cooperation and distribution clout?
A retail chain best suited to (most motivated for) selling replacement water filter cartridges should probably not be affiliated with, or doing much business with, one of
the major bottled water groups like Pepsi, or Coca-Cola, or Danone or Nestlé. Unfortunately, this would seem to rule out the largest chain of xxxxx stores in Mexico,
Xxxxx as that company is owned by Xxxxxxxx. Xxxxxxx-based Xxxxxx (Xxxxxxx
Xxxxxxxxx Xxxxxx, S.A.B. de C.V.) is the xxxxxxx xxxxxxx company in Mexico and
in Latin America. It is also the largest independent xxxxxxx xxxxxxx in the world.
And Xxxxxxx, of course, is one of the largest players in the Mexican xxxxxx xxxxx
business.
Xxxxxx is primarily franchised and is the largest chain of convenience stores in Mexico.
It is also headquartered in Xxxxx. It has almost xx,000 stores throughout Latin America.
The Xxxxxxx store layouts are similar to those one encounters in a number of Xxxxxxowned xxxxxx xxxxxxxxxx chains, including xxxxxx.
Xxxxxxxx was founded in 977, following a Xxxx marketing plan to use companyowned stores to promote and market the Xxx Xxxxx brands of xxxxxx. This bypassed
the traditional Mexican network of local wholesalers selling xxxxxxx via local xxxx and
xxxxxxxxxxx. Initially, the only products sold by Xxxxx were xxxxxx, xxxx and xxxxxx.
The success was such that Xxxxxx expanded rapidly. Its xxxx stores can now be found
throughout Mexico and they carry far more products than the initial stores in the chain
did.
The Xxxxxx stores face regional competition from Xxxxxx, Xxxxxxx (Xxx Xxxxx),
Xxxxxxxx, Xxxxxx and Xxxxxxx. Xxxxxx convenience stores also face competition
from numerous small chains of retailers across Mexico.
Xxxxxx, primarily operating as a franchise, is the world’s largest operator, franchisor and
licensor of convenience stores, with more than xx,000 outlets globally. Xxxxx branded
stores, under parent company Xxxxxx xxx Xxxxxxxxxx are located in xx countries. Its
Page 87
Baytel
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Section 6. Products, Brands, and Prices
SamplePage
Various Disinfecting Drops and Tablets
Page 103
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Section 7. Product Distribution
SamplePage
Xxxxx and Xxxxx Xxxxx carry Pureit products
OTHER CHANNELS
AS MENTIONED ABOVE, a comparatively small number of systems are sold each year
through direct sales and through online sales. Amway is the only significant direct sales
firm offering (serious) water treatment equipment in Mexico. However, the Xxxxx system is seen as xxxxxxxxxx xxxx for all xxxxx xxxxx xxxxxx. It is likely that Tupperware
will target the Mexican market using direct sales once it has gained some experience
with its new line of purifying pour-through filter pitchers (carafes) in India.
The Amway eSpring is available through direct sales
Page 117
Baytel
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Section 8. Product Use in Homes
SamplePage
HOUSEHOLD VISITS & PHOTOS
Baytel visited Mexican households in various areas to question consumers and provide
an overview of habits and attitudes with respect to home water treatment products.
Homes in the higher income brackets—the A/B group, as it is usually defined in Mexico—are very difficult to access because of security concerns. These families tend to have
xxxxxx xxxxx xxxx (and thus xxxxxx xxx) and most use xxxxx xxxx xxxxx. Some of
these households have xxxxxxxxx systems, and occasionally, a xxxxxxx system (xxxxxx
or xxxxx) for treating some water.
Homes in the A/B group have strong security and pressurized water systems
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Section 8. Product Use in Homes
SamplePage
Representative Household Five (C+ Income Group)
This C+ family uses a Pureit water purifier instead of bottled water.
Household 5. Exterior view and propane tanks
Household 5. View of the kitchen
Household 5. Views of the Pureit in the kitchen
Household 5. Dining room
Household 5. Living room
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Section 10. Key Market Participants
SamplePage
Margins:

HUL .....................................xx.x%

Stockist/Distributor...............xx.x%

Seller .....................................xx.x%
DISTRIBUTION IN OTHER COUNTRIES
HUL has now launched the line in Xxxxxxxx, Xxxxxxx, Xxxxxx, Xxxxxxx, Xxxxxx,
and Xxxxx. The marketing, advertising, and promotion efforts supporting the line have
been first rate, and if (or rather, when?) the company decides to enter the Chinese market—with Pureit and Marvella—or with a new product line—one can expect results.
In Mexico Unilever is taking on the bottled water industry and home delivery of bulk
bottled water (9 liter or 5 gallon bottles or “garrafones”) head on. See the ads on the
Pureit Mexico website. In Mexico the launch started in Xxxxx in March of 20 and has
since been expanded to Xxxxxxxxx. “Pureit is already well established in Xxxxx, where
the filter is used by more than 20 million people. Its launch in Latin America follows
(Xxxx Xxxxx and Xxxx) its introduction in Xxxxxx and Xxxxxx at the end of 200.”
At the time of updating this report (late 204) the Pureit Classic was retailing for x,xxx
pesos ($xxx) at Xxxxxx in Mexico City. When Unilever starts manufacturing the Pureit
in Mexico this could change significantly!
Xxxxxx is another very large home-delivered bottled water market where Unilever is
taking on the bottled water industry (including one of the four global giants, Xxxxx),
head on. Unilever has been expanding the Pureit line and its acquisition of Qinyuan in
China can be expected to further bear on this shortly.
“UNILEVER MANUFACTURING THE PUREIT IN MEXICO”
[Translation of a news article] “Unilever Mexico plans to invest 500 million pesos. 19/04/2012. During
the work of the World Economic Forum for Latin America, the President of the United Mexican States,
Felipe Calderón held a meeting with the President of Unilever Mexico, Fabio Prado. At the meeting,
exchanged views on economic development in Mexico and competitive conditions that make the
country a great destination for productive investment and generating jobs. The President of Unilever
Mexico shared the president the 2011-2015 investment plan of the company, which includes not only
additions to its plants in our country, but the creation of a new plant. The investment plan includes a
total of 500 million pesos or about $39 million, which represent the generation of approximately one
thousand direct and indirect jobs. Unilever said that studying the possibility of installing a manufacturing plant in our country to develop a new technology “Pureit”, which consists of a water purifier,
which represent more investment, creation of additional jobs and health benefits for the general
population. President Calderón expressed his gratitude to Unilever for their confidence in investing
in Mexico and wished him every success in its expansion projects, which achieved such as have other
companies because, among other things, high quality Mexican labor. Also congratulated for being a
Page 211
Baytel
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Baytel Associates
About Baytel Associates
Providing global coverage of the
markets, industries, and business
opportunities for providing pure,
safe, good-tasting drinking water to
homes, offices, and consumers on
the move, worldwide
Baytel offers insightful market
research and business opportunity
reports covering numerous specific
country markets. It also provides
confidential custom consulting
services on retainer or on a project
basis.
Were you aware that Baytel carries
out custom, confidential consulting
projects throughout the world?
Contact Baytel in complete confidence to discuss your information
needs. Your initial consultation is
free, and non-binding, leaving you
with absolutely no obligation.
See what Baytel can do for YOU!
Baytel Associates. 60 Lake Avenue
Ocean Grove, NJ 07756 USA
+1-732-988-6792
www.baytel.org
[email protected]
Baytel Associates. Tel: 1 732 988 6792. www.baytel.org

to see a sample prospectus.

Transcription

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