:: South African National Bottled Water Association ::

The first bottled water bottled commercially in South Africa was bottled in the early 1800’s at the Van Riebeek plant in Cape Town. The water came from Albion Springs, which is the strongest flowing of the springs at the base of Table Mountain. The plant was then bought by South African Breweries and eventually became part of Cape Town’s municipal water supply.

South Africa’s modern natural mineral water bottling industry is only 15 years old and, by comparison with its 35 year old European and American counterparts, is tiny. South Africans drink 2.5 litres of mineral water per person per year. Italians by contrast drink 147 litres per person every year. An average sized European bottler produces as much as our entire industry.

There are between 80 and 100 bottlers of natural water in South Africa, producing more than 270 million litres a year and generating over a billion Rand in turnover.

The industry’s first representative body, the South African Natural Bottled Water Association (SANBWA) was formed in 1997. It sets standards for the industry aimed at ensuring the production of safe, pure, good-tasting water.

SANBWA has undergone a change of name in 2007 to South African National Bottled Water Association in order to incorporate prepared waters.

The industry is growing annually at more than 20%- as South Africans become more health conscious.

The law requires that all natural mineral bottled water comes from an underground source or spring that cannot be contaminated or polluted.

The majority of such sources are in rural areas, where the environment is cleaner than in cities, and are stringently tested for purity and safety of the water. The environment surrounding a bottling plant must be kept clean and safe by the bottler.

Natural bottled mineral water therefore contributes to sustainable maintenance of indigenous environments.

In terms of water usage, all the water used by the South African Bottled Water industry in a year- whether for production processes like rinsing the bottles and equipment or for filling the bottles- would not irrigate more than about 5 hectares of agricultural land.

The industry’s 270 million litres can be calculated to 742 cubic metres per day. One hectare of irrigated land requires about 60 to 80 cubic metres per day depending on the crop planted. Thus it can be seen from these figures that bottled water is the most financially rewarding use of water. It also creates more employment per litre of water than any other use of water.

SANBWA requires all its members using underground water sources to register with the Department of Water Affairs and Forestry as water users, even though their water usage is usually too low to require registration.

Unlike tap water, bottled water is defined as a food and is therefore regulated by all the acts ensuring that South African food is produced to world-class health and safety standards. Legislation specifically dealing with bottled water had been passed in 2006. Under the new law, bottling of water will be monitored by the Department of Health.

Over and above these precautions, the industry’s representative body, the South Africa National Bottled Water Association (SANBWA), takes the process of protecting the consumer several steps further.

It imposes on member plants comprehensive and detailed infrastructural and procedural requirements, based on enhancements of the European industry’s standards.

In addition, SANBWA requires in-depth, annual, documented tests of member facilities- including the water source. They also undertake random monthly tests on member products taken from the shelf. SANBWA also gives its members stringent guidelines for documented in-house tests aimed at ensuring the safety of staff and the highest quality products for consumers.

SANBWA members must list the mineral content as well as the origin of their water on their bottle labels. They are entitled to use the association’s logo on their bottles- thereby assuring consumers that their water meets quality and health standards.

SANBWA’s 10 members produce more than 80% of South Africa’s natural bottled water.

The two biggest bottlers, each produce between 15 000 and 20 000 litres of water an hour. Four or five of the medium-range bottlers can produce upwards of 3 000 litres an hour. Some bottlers are small, producing no more than 10 litres an hour by hand.

The large bottlers have fully automated systems. The medium-sized bottlers have automated filling systems, but manual systems for packaging and labelling. The small bottlers do everything by hand.

Hygiene is the most critical factor in bottling water. Water is one if the most difficult foods to package, because it contains no preservatives.

Start-up costs for bottling plants vary between R500 000 and R100 million, depending on the size of the operation and the degree of automation.

Because the profit margins on natural bottled water are small (11% for 500ml) bottlers need to produce high volumes to achieve an adequate return on investment. Although automation is the best way to achieve high volumes, it is expensive for small bottlers, and of course the product has to be sold. There is therefore a reasonably high attrition rate for small and hand bottlers.

Ironically, the small, hand bottlers are good creators of job opportunities because they are labour intensive. Most are located in rural areas, where they provide work for, particularly, unskilled labour. A small bottler can employ up to 20 people.

Because they are automated to varying degrees, larger bottlers, who can employ up to 200 workers, create job opportunities indirectly – through their distribution networks and by adding additional shifts during peak production seasons.

Bottled water is viewed by consumers, not simply as water but alternatively as a health beverage. Its consumption is therefore lifestyle-related.

So, the two biggest markets for bottled water currently are Gauteng, where the South African health and lifestyle industry has its biggest footprint, and Cape Town, where tourists have a direct, semi-seasonal impact on sales of bottled water.

In the past , most sales took place during the hot months, but as tourism has become less sensitive to seasons, so demand has evened out.

Only four bottlers distribute nationally, with all the other plants supplying reasonably small regions. This skew in distribution is directly related to the low price of bottled water and the fact that water is heavy to transport. Smaller bottlers don’t produce enough volume to offset the cost of long-distance transport.
Restaurants account for 17% of bottled water sales, with retail outlets accounting for 51% and wholesalers 14%. Sales through service stations convenience stores are growing rapidly and account for 18% of bottled water sales.

About 75% of the mineral water consumed in South Africa is still, and 70% is unflavoured- although the flavoured market is growing rapidly.

South Africans are not yet particularly brand-conscious when it comes to buying bottled water. As public awareness grows, SANBWA’s role as the industry’s representative body will become progressively more important in terms of establishing and maintaining the credibility of the industry as a source of good-tasting, safe bottled water.