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Chariman: Mr. RAMESH CHAUHAN

Duration: 37 YEARS OF UNBEATEN AND LEADING

EXPERIENCE

Background: In 1967, Bisleri an Italian company, started by Signor

Felice Bisleri, first brought the idea of selling bottled water in India. It

started a company called Bisleri India. In 1969, Ramesh Chauhan, the

Chairman of Parle Exports, bought over the brand. In those days,

Bisleri packaged drinking water was available in glass bottles.

Being a returnable package owing to various other problems such as

breakage and weight, in 1972-73, Bisleri was made available in PVC

(Poly Vinyl Chloride) bottles. After this plastic packaging was

introduced, things started to change, and sales increased rapidly.

The upsurge in the sales of Bisleri started in 1993 as Ramesh Chauhan

sold off the Parle stable of brands, including Thums Up, Limca and

Gold Spot. Recognising the potential of the packaged drinking water

market, he then went on to concentrate on making Bisleri a top selling

brand in India.

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And this is how parle bisleri began: There are 1,200 bottled water

factories all over India (of which 600 are in one state -- Tamil Nadu).

Over 100 brands are vying for the Rs 1,000-crore (Rs 10 billion)

bottled water market and are hard selling their products in every way

possible -- better margins to dealers, aggressive advertising, catchy

taglines.... In such a scenario, The Strategist takes a look at how it all

started -- with Bisleri -- and how Ramesh Chauhan, chairman, Parle

Bisleri created a market out of pure water.

[Sources: Bureau of Indian Standards]

C an I be honest? When we bought Bisleri mineral water from the

Italian company, Felice Bisleri, in 1969 -- the company had been

unable to market bottled water and wanted to exit the market -- we too

did not see any potential for the product at that time.

As a soft drinks company, we had Thums Up, Gold Spot and Limca

(cola, orange drink and lemonade) but no soft drink company was

complete without a soda. So we merely used the name and launched

Bisleri soda with two variants -- carbonated and non-carbonated

mineral water.

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But three decades ago, what could we say about a category that had no

market? We didn't know our target group. Then, since bottled water is

colourless, tasteless and odourless, it was not an easy product to

advertise. Thus, the earlier brand building efforts focused on Bisleri

being healthy with adequate minerals. The Italian name added a dash of

class to it. The first print ad campaign captured the international

essence and showed a butler with a bow tie, holding two bottles of

Bisleri.

The punchline was, "Bisleri is veri veri extraordinari" (the spelling of

the punchline was designed to capture the consumer's attention). The

campaign was successful and we were being noticed as someone who

catered to the need for safe, healthy drinking water.

However, the real boost to mineral water came in the early-to-mid-

1980s when we switched to PVC packaging and later to PET bottles.

The PET packaging did not just ensure better transparency -- we could

now show sparkling clear water to the consumers. It also meant better

life for the water.

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Meanwhile, Bisleri soda was doing well but we had to discontinue

production as we sold our soft drink brands to Coca-Cola in 1993. But

my interest was in building brands and not in bottling soft drinks.

That's when I started to concentrate on developing the Bisleri water

brand.

There was a clear opportunity of building a market for bottled water.

The quality of water available in the country was bad. It was similar to

what Europe faced before World War II. The quality of water in Europe

was extremely poor, which created the bottled water industry there. In

India, too, not only was water scarce, whatever was available was of

bad quality.

Initially, though bottled water was something only foreigners and non-

resident Indians consumed, we still had to increase the distribution,

which meant the dealer margins reduced. And because of limited sales,

the dealer margin had to be kept high to compensate low sales. Now we

had to push sales.

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But to reach out to the masses, we had to make the category more

affordable. The introduction of a comfortable-to-carry 500-ml bottle for

just Rs 5 in 1995 not only answered that need, but also meant doing

away with carrying the excess water or throwing it away if you were to

buy a one-litre bottle.

The idea was a success and gave the company a growth of 400 per cent.

We also introduced the 1.2 litre bottle in 2000, which was aimed at

those who share their water. This also gave us the advantage of higher

margins that a crate (12 bottles) generated. With other brands joining

the fray, things were hotting up -- the bottled-water market was

estimated at Rs 300 crore (Rs 3 billion) and was growing at 50 per cent

a year. Bisleri had captured 40 per cent of the market.

We realised it was time to move to the next level -- the bulk segment.

Several commercial establishments had no access to piped water. We

tapped into this segment by introducing the 12-litre container, followed

by the 20-litre can. The bulk segment also helped bring down the price

per litre from Rs 10-12 a litre to about Rs 3 a litre.

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At present, the bulk segment constitutes 60 to 70 per cent of our sales

and we intend to increase it to 80 per cent in the next two years. With

water scarcity in several cities, even households are demanding bottled

water now.

The home pack was made more user-friendly by introducing pouring

spouts and jars with dispensers. At the same time, we were constantly

looking for new ways to tap the market. We noticed that during

wedding receptions, the older guests (above 50 years of age) generally

stayed away from ice cream, soft drinks and so on.

Hence, we introduced free sampling of Bisleri at the tables where the

elderly guests would sit. Soon customers were ordering bottled water

on special occasions. Currently, the consumption of bottled water is far

in excess of soft drinks on such occasions. The other major challenge

was distribution.

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I still have the mindset of a soft drink seller. Soft drink sales are in

glass bottles and the distribution model is built around picking up

empty bottles and getting them back to the factory.

That's not the case with the retail bottled water packs (below 2 litre).

But a product that's not available where it's needed, is useless.

The number of outlets where Bisleri is available has increased from

50,000 in 1995 to 2,00,000 at present. But that is not enough -- we need

to keep looking for different avenues.

Take stationery shops and chemists, for instance. They don't keep soft

drinks but sell Bisleri. That is the kind of exclusivity we look for to get

ahead of the distribution network that soft drink companies talk of.

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THE JOURNEY TILL NOW (AT A GLANCE):

1969: Buys Bisleri bottled water from an Italian company, Felice

Bisleri. It was bottled in glass bottles then.

Early-1980s: Shifts to PVC bottles. Sales surge

Mid-1980s: Switches to PET bottles, which meant more transparency

and life for water.

1993: Sells carbonated drink brands like Thums Up, Gold Spot and

Limca to Coca-Cola for Rs 400 crore.

1995: Bisleri launches a 500 ml bottle and sales shoot up by 400 per

cent.

2000: Introduces the 20-litre container to bring prices down from Rs 10

a litre to Rs 2 a litre.

1998: Introduces a tamper-proof and tamper-evident seal.

2000: BIS cancels Bisleri's licence of a water bottling in Delhi since

some of the bottles did not carry ISI label; the licence is restored one-

and-a-half months later.

2002: Kinley overtakes Bisleri. The national retail stores audit by

ORG-MARG show Kinley's marketshare at 35.1 per cent compared to

Bisleri's 34.4 per cent.

2003: Bisleri says it plans to venture out into Europe and America to

sell bottled water

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To provide the highest quality

product, keeping in mind all

aspects including freshness, purity

and safety, and making it easily

available to the consumer at a

very affordable price.

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It was around the year 1995, when Parle Exports took charge of the

brand operations and the business took off in the market. With factories

across India and a strong distribution network, Bisleri established itself

as a force to reckon with in the domestic packaged drinking water

market.

Earlier the packaged drinking water market consisted of five star hotels,

tourists and foreigners. As a marketing strategy, a conscious decision

was taken by the company that only 40% of the sales should come from

these outlets and 60% from general market. i.e. paanwallas, street

shops, general stores and even non-tourists.

This brought about a sea change in the perception in the consumer's

mind about consumption of Bisleri. Earlier, drinking bottled water was

considered to be more of a status symbol. That thinking has slowly

changed to the point where today, not drinking Bisleri is considered as

being behind the times. Such has been the presence and penetration of

the Bisleri brand in the bottled water segment.

About two years ago, in 1998, a strategy was adopted to concentrate

aggressively on the home market. The habit of boiling water or using

electronic gadgets was not adequate, since the source of water itself

was unreliable. The bulk packages like the 2, 5 and 20 litre bottles were

introduced to meet this market need. The price per litre went down as a

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result, making bottled water very economical for the consumer.

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A National Sample Survey conducted by the Central Statistical

Organisation in 1988, showed that 72.1 per cent of urban households

had access to piped water; by 1998, this proportion had reduced to 70.1

per cent. And with most urban 'consuming class' customers aware of

the importance of pure drinking water, the future looks promising for

companies vending the commodity.

Bisleri was the first to market bottled water in a totally virgin market

and naturally people associate the brand with bottled water. Now

Bisleri is perhaps already ten steps ahead of its competitors and will

endeavour to widen its gap in the times to come.

Bisleri's brand positioning stresses on pure, clean and safe drinking

water.

Some of the future plans to maintain the top spot that Bisleri commands

in the Indian market are:

New pack sizes in bottles and cups

Increase the distribution network with an investment of over 200

crores

Strengthen presence in traditionally weak areas by setting up 12

new bottling facilities at a cost of Rs. 150 crores

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PARLE BISLERI LIMITED: EXPANSION PLANS: Parle Bisleri

Limited is undertaking a major expansion to increase its manufacturing

facility as also to widen the distribution network. The total project cost

is estimated around Rs 260 crore.

Of this, Rs 60 crore will be utilised to expand the existing

manufacturing facilities wherein the bottling capacity would be

doubled to 200 million cases per day.

Around Rs 200 crore will be spent on increasing its distribution

network five-fold over the next two years. As a result, the company

will have 10-lakh retail outlets backed by a fleet over 5,000 vehicles.

Parle Bisleri also plans to procure recycling plants from Japan, for its

PET bottles, and set up at least two such plants in Chennai and Delhi at

a cost of Rs five crore each by this year-end.

Crushed and compacted bottles from other parts of the country will be

transported to the two plants and a better part of the compacted PET

will go into manufacturing polyester yarn. Though the company plans

to come out with an IPO, two years down the line, the present capital

expenditure plan will be financed entirely through internal accruals.

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Bisleri water is available in a range of sizes viz 500 ml bottle, 1 litre

bottle, 1.2litre bottle, 2 litre bottle, 5 litre jar, 20litre jar and 50 litre

jars.

500ml bottles to 2 litre bottles have been segmented for individual

consumer and nearly 80% of the manufactured bottles consumed during

the transit sphere such as in and near Bus stations, Railway Stations

and Air ports. People prefer to carry the purified mineral water along

with them as they least prefer the water at locales.

Whereas 5litre jar, 20 litre jars and 50 litre jars are segmented for

industrial clientele where purified water is required in bulk quantities.

Also found in marriage, parties halls, restaurants and hotels, serving in

the hexagonal 20 litre shaped jars with easy to carry lifter gives a

significant impact of branded loyalty.

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BISLERI LAUNCHES 20 LITRE PACK : The Rs. 400-crore Parle

Bisleri Ltd, pioneer of the packaged drinking water industry since

1967, has introduced the first of its kind home delivery facility for its

20 litre pack (Rs. 70 MRP) which will be delivered by a specially

designed fleet. This is a part of the Rs. 260-crore expansion plan to

reach 2,500 Indian cities/towns.

According to the Company's Chairman, Mr. Ramesh Chauhan, Bisleri

is targeting a turnover of Rs. 50-crore from its 20 litre pack segment in

the first year. "The home delivery concept of Bisleri is an unparalleled

marketing exercise for an FMCG product in India," he added.

Flagging off the first leg of this consumer-friendly concept in Mumbai,

he further stated that Bisleri sales would cross the Rs. 1,000-crore

target by the year 2002. "In the last two years, the company has grown

at a wonderful pace of 150 per cent (annual) and this year's sales would

witness a 200 per cent jump," according to the Chairman.

Attributing the sharp rise in turnover to company's innovative

marketing measures and growing consumer awareness of safe drinking

water, Mr. Chauhan stated that Bisleri has varied packs to cater to all

segments. Bisleri has a unique break away seal which is patented and

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cannot be duplicated or tampered with. This ensures that the consumer

gets a highly safe product.

He further remarked that the Bisleri brand currently holds a 60 per cent

market share in India's Rs.700-crore branded packaged drinking water

industry, which is growing at a pace of 70 per cent per annum.

Highlighting the company's expansion plans, Mr. Chauhan stated that

the company will be investing Rs. 60-crore for expanding the existing

facilities whereby the bottling capacity will be doubled to 200 million

cases a day and an additional Rs. 200-crore on expansion plans, which

will provide a five-fold jump in Bisleri's distribution network.

The newly launched 20 litre pack will provide further impetus to the

growth rate and currently 20-litre jar comprises about 40 per cent of

overall Bisleri sales.

Recent packaging firsts for Bisleri have been the breakaway seal,

hexagonal 20-litre jars, pouring spouts and jars with dispensers which

do away with the need to lift the jars while pouring out water.

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Purity and taste are two major factors taken care in sourcing of Bisleri

water. Underground spring is carefully selected based on its purity and

pathogen free water. Great care goes in tapping this source. Only water

below 25 metres is tapped, to avoid any surface contamination to

percolate and mix with underground water source. Area surrounding

the water collection tube at the surface is protected,So that it remains

clear.

Processing and Quality Assurance

1. The casing tube itself is protected with stainless steel mesh to give

a preliminary filtration to the water.

2. Ultra filtration gives water reduction in turbidity and adds sparkle

3. Activated carbon purifier to remove colour and odour in water

4. Reverse osmosis membrane has porosity of less than 0.01 micron

the process renders water free o micro-organisms.

To ensure Bisleri is held safe free from contaminations, ultraviolet

treatment and ozonisation process is carried out. Ozone a very powerful

bactericide with no side effect, as it disintegrates into oxygen within

couple of hours.

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Sterilization effect of ozonised water continues even after water is

packaged, thereby ensuring safety of Bisleri upto its final packing. To

ensure high quality of packing materials, components like caps and

bottles are manufactured in-house.

Good Manufacturing Practices are stringently followed at all times.

Processing is religiously monitored at every stage. Testing source

water, processing parameters, microbial quality, packaging material

integrity and finally, shelf life studies, forms an integral part of quality

and safety assurance plan.

Facts regarding Water:

Why is water important?

Water constitutes more than 75 % of our body weight. Human

beings cannot survive without water. Our body needs minimum 2

Litres of water every day. Inadequate intake of water leads to

dehydration. Water plays crucial role in almost all the metabolic

functions like blood circulation , digestion , excretion , temperature

regulation etc.

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Water is a good source of minerals such as Calcium , Magnesium etc.

which are essential for normal functioning of our body systems.

Impure water contains toxic substances as well as disease causing

microorganisms. Such water can cause illness and health hazards. So

daily intake of pure and safe BISLERI water is vital for us.

How much is enough?

We must consume a minimum of 2 litres ( 10 glasses ) of water every

day.

Why bottled water?

Bottled water is purified through multi – stage process. It is processed

and packed under hygienic conditions. No other source of drinking

water can give 100 % guarantee of safe and pure water. Bottled water

is most convenient source of pure and safe water.

What harm can impure water do?

Impure water leads to various diseases and health hazards. It can cause

Cholera, Typhoid , Gastro – intestinal disorders , Kidney damage and

skin disorders. Most of the diseases are water borne. BISLERI provides

you safe , clean and tasty water.

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Why Bisleri is pure?

At BISLERI plants , water undergoes multi – stage purification process

to ensure proper blend of minerals and complete removal of

microorganisms and toxic substances. So a habit of drinking PURE and

SAFE BISLERI will ensure a healthy life.

WHAT ADVANTAGES BISLERI PURIFICATION PROCESS

HAS OVER PURIFICATION DONE BY OTHER METHODS?

Traditional process of boiling water for purification has its

limitations.It is time consuming. For boiling , water has to be heated to

100 deg.Celsius. Also , to kill microbes water should be boiled

continuously for a minimum of 20 minutes.

Boiling may kill the microbes but can not remove other physical

impurities and toxic substances. Many home appliances are available in

market for water purification. These gadgets use either filtration

technique or Ultra Violet rays or a combination of the two techniques.

These techniques do not guarantee 100 % purity of water.

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Filtration removes only the visible suspended particles and not the

minute , invisible particles , toxic substances or microorganisms. The

filters are cleaned rarely and all the muck accumulates inside leading to

more contamination.

Ideally such filters need to be cleaned every day which is cumbersome.

Ultra Violate rays kill the microbes but cannot ensure removal of toxic

substances and physical impurities.

These purification equipment are incomplete and need continuous

monitoring and maintenance. At BISLERI , through our multi – stage

purification process we ensure removal of toxic substances as well as

physical and microbiological impurities.

In our state-of-the-art processing plants we follow rigorous Good

Manufacturing Practices and strict Quality Assurance norms so each

and every bottle of BISLERI is made tasty, pure and safe for the

consumer.

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To make sure that the product that reaches the consumer is always of

highest standard and also meets international standards, Bisleri has

always been involved in improving its product packaging.

One such recent development is the tamper proof break away seal.

Bisleri also recognises the need to produce environment friendly

products and is working on the PET project.

The break away seal:

Keeping in mind the consumer's need to recognise a genuine product

that cannot be tampered with, Bisleri developed the break away seal.

The unique cap has been patented and cannot be duplicated or tampered

with.

This technology development in the product ensures that the consumer

will only get a highly safe product when they consume Bisleri

packaged drinking water.

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Product packaging:

To ensure purity of the bottled water, the bottles that are used are

blown and filled at the factory itself, to avoid contamination.

The PET recycling project:

Bisleri is extremely conscious of environmental issues, since PET

bottles are not biodegradable and not easy to dispose. The company is

currently working on the PET recycling project, where they will collect

bottles from various places, crush and shred them.

This shredded material will then be made into ropes , PET containers

for the non-food industry and other PET items like polyester fibre,

flower vase, gift items etc.

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BISLERI has a wide distributional network of area in the following

cities herein mentioned:

Delhi, Ludhiana, Jaipur, Noida, Ahmedabad, Mumbai, Goa,

Bangalore, Chennai, Hyderabad, Kolkata (earlier Calcutta),

Kathmandu (Nepal) where it outsells every other brands and

from these network areas (cities), Bisleri distributed out in

wholesale to all other parts of the country.

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The best beverage for India in the new millennium seems to be water.

In recent years, the bottled drinking water market has been witnessing

high-decibel levels of activity, with a host of new entrants swelling the

clutter.

With over 200 players jostling to be the thirst quenching favourite of

the Indian consumer, the business is growing at a rate of over 50 per

cent annually. The country's bottled water business is estimated to be

around Rs. 1,100 crore, of which the branded market accounts for Rs.

700 crore and about 700 million litres in volume.

In India, the core proposition of bottled drinking water lies in hygiene,

as the quality of tap water is bad and is rapidly deteriorating. This is in

stark contrast with the West where ‘mineral water’ indicates the

attendant minerals present in the water.

Mineral water in Western countries is obtained from natural springs

and is, generally, named after those springs. Most of the bottled water

passed off as mineral water in India, however, is filtered, boiled or

purified by other means such as reverse osmosis.

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A better description of bottled drinking water sold in India therefore,

would be ‘purified bottled water.’

The growth of the category indicates the need for this ‘mineral water’

and the fact that heavyweights are eyeing the segment points to the

potential that is seen in this market. Coke, Pepsi, Brittania, Nestle,

Auswater -- are keen on raising their stakes in the Rs 700 crore, 700

million litre market.

The entry of Danone's brand, Evian, the high-priced mineral water from

the French Alps, shows the perceived potential India presents in this

product category. Clearly targeted at the premium segment of

consumers, the brand is being distributed in the country by Britannia

Industries. Currently, Evian has more of an institutional presence (five

star hotels) than on the retail shelves, with a 1-litre bottle being priced a

hefty Rs 80.

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SWELLING THE CLUTTER:

For starters, his own brother, Mr. Prakash Chauhan through brand

Bailley, has been trying to emulate the Bisleri success through the

franchisee route. And is catching up pretty fast!

Then there is Pepsi with its Aquafina brand and backing of a good

distribution channel of 60,000 outlets. Pepsi banks on its refrigerators

at retail outlets, which stock its cold drinks, for Aquafina as well.

Another soft-drink major, Coca Cola, with an equally pedigreed

distribution network, is using the same for its brand of water, Kinley.

A player with technical expertise is Thermax, through a joint venture

with US-based Culligan Water Technologies. Largely into industrial

water purification,

Thermax Culligan recently announced its entry into the household

segment with the launch of 20-litre packs of drinking water, branded

Good Water, at Rs 60 a pack.

The company has set up a plant at Taloja, Maharashtra, and is in the

process of expanding its business into markets within a radius of 180

kms of this plant. Through this expansion, the company plans to enter

the markets of Nashik, Ahmednagar, Lonavala and Mahabaleshwar.

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The company is planning to set up more plants at New Delhi and

Gujarat. With a customer base of 2,400 in Pune and Mumbai,

amounting to 32,000 bottles of 20 litres a month,

Thermax Culligan is planning to set up access points for drinking water

at various outlets in Maharashtra. The company has no immediate plans

to introduce smaller packages for its product.

Then there are a number of FMCG giants waiting in the wings and

firming up plans. Multinational Nestle is also said to be keen on

entering this market. Nestle is a big player in the mineral water market

internationally, with brands like Perrier and San Pellegrino in its stable.

It sells water drawn from local springs in Europe and its brands are

named after the springs. Sources in the company say that Nestle is in

the process of setting up two bottling plants for the venture, one at

Taloja, near Mumbai, and the other in New Delhi, to service the

markets in those regions.

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Plans are initially to tap only the huge market for bottled water in large

cities and towns, the sources said. The product would be launched

simultaneously in the Mumbai and Delhi markets.

For Nestle, India will be the next major stop after Pakistan, where it

launched the Pure Life brand first. The company plans to ride

piggyback on its distribution network for chocolates, which are hawked

through a large chain of retail outlets.

Then there is Godrej with Aquapure. Britannia at presents distributes

Evian and will launch its own branded water very soon. The National

Dairy Development Board also plans to launch Dhara through its

distribution chain, new entrant Atco with Brilliant water and DS Foods

with Catch spring water positioned on the mineral water plank. Even

Hindustan Lever is said to be firming up plans to enter the market.

Apart from these are the small players, which, according to some

estimates, cater to nearly as big a market as the big players. Among

these the important ones are: Godrej’s Golden Valley in the south,

Amrit Agro’s Amrit Aqua, Kothari Foods’ Yes and T-Series’ Ganga in

the north and SM Dyechem’s Peppy in the west.

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DIFFERENTIATION

A clear differentiation is happening among the medley of water brands

in terms of both pricing and positioning. While Bisleri is touting itself

as ''pure and safe,'' brands like Bailey, Yes, and Hello are trying to ride

the mineral water wave.

And Evian, launched by French transnational Danone sells itself as

''water from the French Alps'' competing with premium soft drinks.

The fact however remains that almost all players in this category are

positioning themselves on the purity and hygiene platforms since the

very raison d'être of bottled drinking water is the bad quality of tap

water in the country.

In this scenario how will Mr. Chauhan differentiate Bisleri from the

others and, more importantly, for how long?

Mr. Chauhan has been trying to differentiate Bisleri by its breakaway

seal as an assurance of purity. As he says almost 76 per cent of

consumption of bottled drinking water happens in transit.

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Market research conducted by Bisleri revealed that the other overriding

concern for this set of buyers is the tampering of the seal and the reuse

of bottles.

Many have witnessed used bottles being refilled at railway stations. So

when a consumer buys mineral water, he would like to be assured that

the water has not been tampered with.

At the same time Bisleri is promoted by an aggressive print-and-TV

backed by hoardings and point-of-sale material. Every interface with

the consumer is being used as an opportunity to reinforce the message.

For instance, all vehicles used for supply have been painted in bright

blue, bear the Bisleri logo and sport catchy baselines like ‘drink and

drive’.

Apart from creating consumer pull with an advertising campaign, Mr.

Chauhan is boosting the retail push as well. Says a local marketer of a

brand, strong in the institutional segment, toying with the idea of going

retail, "Distribution is the key.

The consumer will pick up whatever is conveniently available and is

pushed by the retailer.

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Mr. Chauhan says that from his vast experience of marketing Gold Spot

and Thums Up, he learnt that distribution plays a crucial role in the

successful marketing of bottled drinks. He says, "Just about anybody

can invest money into a bottling plant or other facilities. The really

dirty work is distribution. Making fresh water available within a

particular period of time is crucial for its success."

His strategy is to build a direct distribution system at an all-India level.

According to him, distribution in the Indian context requires

experience. Bisleri’s retail distribution muscle is indeed great.

With 16 bottling plants to churn out the product, Bisleri has around

80,000 outlets in the country with about 12,000 each in the metros of

New Delhi and Mumbai. Mr. Chauhan intends to increase that to 10

lakh outlets and use around 2,000 trucks to criss-cross the nation, up

from the current 1000.

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With little belief in the distributor system, the company leverages its

large fleet of trucks to supply bottled water directly to retailers through

a system called ‘route selling’ where the driver of the truck is trained to

be a service person.

A critical component, this system, according to him, ensures that the

water supplied is fresh and bottles are in good shape. Though route

selling is more expensive than the more commonly followed method of

appointing distributors in different towns, he says, it is more effective.

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In the country, the cost of production of treated and purified water is

very low, the industry is spending much more on packaging and

marketing of its products.

But it is good time for the water bottled industry which is cashing in on

the need for the clean drinking water and the ability of the urban elite to

pay for this very basic human need.

The fortune of the more than 100 billion industry is directly related to

human apathy towards the environment. The more we pollute the water

bodies, the more urge will be for the purified mineral water, the more

will be the sale of the water bottles.

Some considerable facts:

a) In India, per capita bottled water consumption is as low of 5 litres

per year in comparison to the global consumption of 24 litres per

year.

b) From the 1999 – 2004, the consumption of water bottles have raise

from 1.5 billion litres to 5 billion litres.

c) India is 10 (tenth) largest bottled water consumption in the world.

d) In 2002, the industry had an estimated turnover of 1000 crores.

Today it is one of the India’s fastest growing industrial sectors. As

Indian bottled market grew at a Compounded Annual Growth Rate

(CAGR) of 25%

e) There are more than 200 brands, out of which 80% are local small

scale producers.

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f) The rise in the Indian bottled market began with Indian

liberalization process in 1991.

g) Indian bottled water industry growing at the highest rate in the

world. It can inferred from the following graph:

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Mr. Ramesh Chauhan, chairman, Parle Bisleri, the pioneer of bottled

water as a product in India, says his focus is now entirely on his Bisleri

brand, which reportedly enjoys a 60-65 per cent share of the bottled-

water market.

From Rs. 400 crore turnover, at present, he plans to increase it to (hold

your breath!!) Rs 1,000 crore by year 2002.

According to him, the drinking water market at the moment presents a

huge potential, valued between Rs 700-800 crore and growing at the

rate of nearly 50-80 per cent per annum.

He asserts that Bisleri itself is growing at more than a 150 per cent

growth rate.

Mr. Chauhan has aggressive plans for Bisleri with investments up to Rs

200 crore in the product during the next two years. Fuelling this growth

would be the new 5-litre water jar, priced at Rs 25, targeted at the

household segment and the 500 ml pack priced at Rs 5.

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He has 16 plants located all over the country of which over a dozen are

owned by him and the balance is run by franchisees. Mr. Chauhan

plans to have his own distribution network in places where his plants

are located while franchisees would manage the distribution in their

respective areas of operation.

"In another three years' time, water will overtake soft drinks in terms of

volume sales, and then Coke and Pepsi will be no match.'' he asserts.

His confidence probably stems from the fact that the soft drinks market

is currently not doing too well with both Coke and Pepsi having

reported flat sales for two years in a row.

Both players are currently engaged trying various measures like the

recently introduced small packs of 200 ml, to increase sales.

The bottled drinks market in India is estimated at Rs 5,100 crore, with

soft drinks accounting for nearly Rs 4,000 crore while fruit juices and

other drinks make up the rest.

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He clarifies his stance by saying that, "In all the major markets, water

outsells soft drinks in terms of, what Coca-Cola now terms as, share of

the consumer’s throat. For instance, in the Middle East, water

dominates over soft drinks.

Also bottled drinking water has graduated from being an elitist product

a couple of years ago to being an article of common use now. Also

simple economics dictates that a 500 ml of safe drinking water costing

Rs 5 is a better buy than a 300 ml of soft drink costing Rs 10."

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Water, an incomparable substance, ever our body consist of 70% water,

our earth consist of 68% water, and every living being is dependent

upon water for its life continuity. Water is said to be the only essence in

the earth to live and survive.

Every time we needs water for several purposes namely few:

a) Utmost Essential for drinking use.

b) Necessary for washing purposes.

c) Needful in manufacture of various food packages and drinks.

d) Required in industries for their manufacturing products.

e) Need for producing electricity.

f) In watering, outsourcing as well as for several other uses.

Taking in to consideration all the usages and fact files with references

to Indian people and economy, following analysis pertaining to SWOT

(Strengths, Weaknesses, Opportunities, Threats) have been made as

follows:

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STRENGTHS:

i) As Bottled water industry is the fastest growing sector, serving

millions of people with the purified mineral water to prevent them

from vulnerable diseases.

ii) People are getting more conscious about the purification of water

due to constant rise in water pollution, dirt and impurities in water

over a period of years.

iii)Several Multinational are eyeing on to this prospective market to

explore their market potentialities.

iv) Purified mineral water bottles may lead to discard of soft drinks.

v) More Environment savvy.

vi) Low Manufacture cost per bottle/jar with increasing returns.

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WEAKNESSES:

i) Consumption of lot of water may lead the local people to deprive of

the ground water.

ii) Ground water is getting more scarce as a result people have to mive

far places to fetch out the water.

iii)More water pollution as more bottled water industry are being

planted in the areas near river or lakes.

iv) People are boycotting the use of bottled water as it lead to high cost

of usage of water which is basic necessity of life.

v) Much dependencies on the Water Lord to shower the water.

THREATS:

i) Water is getting scarce, industries need to spend tremendous cost on

borrowing from a channel, dam or nearby state with government

permission.

ii) Use of Plastics bottles is again the degradation of environmental

greenery leading to deforestation, flood and many other natural fatal

calamities.

iii) Local people may put an end to an industry performance of

manufacturing the water bottles by their collective force.

iv) In resident, people are using water purifiers at their home.

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v) Being hazardous to the human life by spreading diseases for the

toxic substances that are being dumped in to the water.

vi) Soft drink manufactures again posing a bif problem as they are is

using a big portion of the water for the manufacture of cold drinks.

OPPORTUNITIES:

i) India is a biggest market, presently less competition is the biggest

opportunity to grow as a market leader.

ii) Best Sales services, more outlets, and new brands to be launched in

to the market to capture the share.

iii) Reap the benefit of leading organization goodwill to foresee the

future profits by nationwide campaigning and spreading the

awareness with respect to usefulness of purities, essence of

utilization of water to the Indian customer.

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Following sources were undertaken in completing project report:

WEB:

1. www.bisleri.com

2. www.rediff.com

3. www.projectsmonitor.com

4. www.india-today.com

PUBLICATIONS:

1. Business Standard

2. The Hindu

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