If you are starting a bottled water company, it is likely that you will need a business plan at some point. The experts at Pro Business Plans have extensive experience preparing plans for investment and strategy. This article provides information on what is included in a bottled water business plan and its structure.
Bottled Water Business Plan
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Bottled Water Business Plan
There are several things to consider when creating a bottled water company that investors will consider when analyzing the profitability of your company. Among the most important include the area of your target location, market positioning, and supply chain. Some bottled water companies seek positioning by appealing to the premium/luxury segment of the market, whereas others target the price sensitive demographics or tap into philanthropic initiatives in order to strengthen its strategy.
Business Model
The business model for a bottled water company encompasses many elements from the market positioning ( value proposition ) to your approach of getting the bottled water into the stores of your customers. The key to building a great business model is to make everything synonymous, while still being profitable. If your brand targets philanthropy , such as donating water for each bottle sold, then it should communicate this through the brand and advertisements. If on the other hand, you’re targeting a low budget market, it may make more sense to focus on the cheapest sourcing options and have no promotions that will increase your overhead expenses.
Value Proposition
There are an exceptionally large amount of competitors within the bottled water industry that are essentially selling a free commodity in most countries. Granted in some economies, bottled water is a necessity, much of the Western world has these resources readily available at no cost. Therefore, finding some unique value proposition to drive your market positioning is crucial to accomplish long-term positioning success. If you can manage to finagle your way into the store, you must also follow-up with persuading consumers to buy your product.
Operations Plan
The operations section of the business model incorporates the entire supply chain from procurement to distribution and sales. The nature of the supply chain will influence your company’s profitability. Bottling the water from some premium source that is either rare or claims to have a higher degree of ‘purity’ would increase the costs considerably. Using premium packaging like glass or a thicker plastic will also increase the costs, but to the benefit of increased visibility. Whatever your value proposition, the supply chain must reflect it accordingly.
Marketing Plan
When it comes to bottled water that appears to anyone but the price sensitive market, the market strategy is critical to success. Your company must find a way to communicate the quality of the brand including the source, packaging, and lifestyle that it communicates. Premium bottled water is not just about good taste, it is about a lifestyle of luxury and status that accommodates driving a premium vehicle or living in a luxury apartment. Similarly, other positioning is about lifestyle from philanthropy to family and conservativism. Each component of your marketing strategy from public relations to in-store promotions should reflect the lifestyle that you’re seeking to build for your customers and brand.
Market Positioning
When it comes to effective brand positioning, few things are more important in the bottled water industry (outside of the price sensitive market). Research has suggested that many consumers can be loyal to a beverage aside from any intrinsic difference that beverage may have from its competitors. Therefore, it makes sense to focus on the positioning in a way that builds brand loyalty and communicating these points in the bottled water business plan.
Promotion Strategy
The promotions for a bottled water company depend upon several factors including the overall strategy of the positioning and where the brand will be sold. Most decisions for bottled water are made at the isle, so many brands will invest into in-store displays that communicate the positioning of the brand and convey its identity in a way that outperforms most other companies. Some bottled water companies go so far as to implement an influencer marketing campaign or public relations that attempts to establish a lifestyle around their brand.
Financial Projections
The financial forecasts for a bottled water company are generally based upon several points including the assumptions as drivers into the revenue projections and a detailed budget breakdown associated with the expenses. The most effective way to perform these projections is to base them off the historical operating performance that your company already generates. For instance, it may asses the historical performance and how an injection of funds will influence the performance of the company in terms of both revenue and expenses.
Revenue Projections
There are several methods of preparing the revenue projections for your business. Among the more popular methods is either using the historical performance of your company or analyzing similar bottled water companies and how their revenue projections are impacted. If you are launching a new company, however, be careful to not be overly optimistic and expect that your sales will rival existing companies as it can take some time to establish a consumer base that your competitors will likely already have.
Budget Forecasts
The budget will be most important if your company is requesting financing from banks or investors . Both parties will want to understand exactly where the money that they are contributing is going in terms of what expenses and assets will serve as the primary drivers for the capital contribution. Investors generally like to see that the money is being used for expansion and ideally being allocated towards assets rather than operating capital, as such is a lower risk and can easily be liquidated in your business underperforms. However, it is important to be honest and conservative when forming the budget request.
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