How To Start A Bottled Water Business In South Africa
What is Bottled Water?
Bottled water is drinking water packaged in plastic or glass water bottles. Bottled water may be carbonated or not. Sizes range from small single serving bottles to large carboys for water coolers.
How To Start A Bottled Water Business In South Africa
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
STEP 2: Form a legal entity
The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your bottled water business issued
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
STEP 4: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 5: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
Federal Business Licensing Requirements
The Food and Drug Administration (FDA) regulates bottled water. FDA regulations for bottled water include Good Manufacturing Practices (GMPs), standards of identity and labeling requirements.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a bottled water business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
STEP 6: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers’ Compensation Coverage.
STEP 7: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a bottled water business
Marketing and distribution is key in this business. Your target market should be grocers, vending machine companies and operators, stadiums, event locations, and other large-scale commercial enterprises and operations that need high volume bottled water supplies.
How to keep customers coming back
Make sure you deliver on your promises and be competitive on your pricing. This is a highly commoditized industry. Often, it’s the business that meets deadlines and has the lowest (or at least competitive) pricing that wins.
Frequently Asked Questions (FAQs)
How much does it cost to start a water bottling company in South Africa?
You will need a budget of around R 250 000 to R 415 000 ex VAT ex-factory (excluding equipment delivery, water storage tanks, carbonation system with bottle rinsers and dispensing taps (like beer dispensing taps), installation labour, installation fittings, filling tables), depending on final specifications and size
How much does it cost to start a bottled water business?
Startup costs can range from $500,000 to $750,000 for a “bare bones” plant. However, some plants may require more capital, up to $1.5 million, or more, depending on the size of your operation. You will also need a license from the S.A Food And Drug Administration (FDA)
Do you need a license to sell water in South Africa?
The Department of Water and Sanitation (DWS) has become aware of the tendency that has developed to sell water from private boreholes. Any such sale would need a requisite licence to be applied for.
Is a water shop profitable in South Africa?
Water shops are part of the fast-growing water business worldwide and they are the lowest cost method to sell purified drinking water. Water Shops are a business with very low startup costs for anyone that wants to get into the water business. It is a very simple business to run and can easily be profitable.
Who owns the water in South Africa?
The 13 government-owned Water Boards play a key role in the South African water sector. They operate dams, bulk water supply infrastructure, some retail infrastructure and some wastewater systems. Some also provide technical assistance to municipalities. Trans-Caledon Tunnel Authority.
Is water bottling a good business in South Africa?
While the market for these alternatives has grown, the bottled water industry continues to profit. It may be easy to grab a bottle of water off the shelf, but as long as consumers continue to choose convenience over the environment, the bottled water industry will remain profitable
What is a water source certificate?
One of the primary purposes of the Certificate of Compliance of Water Installation is the prevention of water wastage, i.e. leaks or dripping taps in the supply pipes or system resulting in unintended and uncontrolled usage.
Can you sell water online in South Africa?
To sell water online, use an ecommerce platform that is simple to use, secure, and flexible. Shopify is an easy-to-use online store builder that lets you start your business without incurring development costs. Shipping, customer service, email marketing, and social media advertisements are all easier with Shopify.