Bottled Water Overview
Bottled Water Overview
An overview of legislative
requirements and market trends
Contents
This purpose of this report is to provide a synopsis of the legislation relating to bottled
water and describe recent market trends to assist in the initial evaluation of the
opportunities for diversification into production. It does not detail the minutiae of
legislative prescriptions. Installation and operation of bottling plants are not
examined.
There are essentially three main types of bottled water: “Natural Mineral Water”,
“Spring Water” and “Bottled Drinking Water”. However, there are many variations of
these types of water, which result from different processes and comprise different
characteristics. These water types may all be used in the manufacture of soft drinks,
including flavoured water. There are no specific regulations regarding the
composition of soft drinks, but legislation relevant to bottled water, given below,
applies.
Abstraction of water from boreholes, springs and wells for water bottling is classed as
a commercial activity and requires a Licence to Abstract. If existing licensed sources
are to be used for the production of bottled water, the procedure for applying for a
new licence must be followed. Further information about water abstraction licences
can be obtained from the Environment Agency (see Additional Sources of
Information & Useful Contacts). Guidance to the production of bottled water should
be sought from the Environmental Health Office (see Additional Sources of
Information & Useful Contacts) of the district council pertinent to the area in which
the abstraction occurs. The Environmental Health Office can give advice on the
relevant legislation, grants the necessary approval to the extraction facility and
ensures appropriate quality standards. Trading Standards (see Additional Sources of
Information & Useful Contacts) should also be consulted about labelling and weights
and measures requirements. Environmental Health and Trading Standards are both
enforcement bodies and, therefore, it is important they are consulted at an early stage
to ensure regulatory compliance.
The market for bottled water, of all types, is relatively young in this country.
However, despite low penetration, strong growth in the market is predicted in the
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future. The major multiple retailers account for the greatest volume of sales but other
outlets are becoming more important. Consumers are generally not aware of the
differences in water types, with brand and/or price being the most important factors in
determining selection. Sales of still water outstrip those of sparkling water by volume
and are forecast to continue to gain ground at the expense of sparkling water in the
future.
Legislation
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http://www.legislation.hmso.gov.uk/si/si1999/19991483.htm , SI 2003
No.474 http://www.legislation.hmso.gov.uk/si/si2003/20030474.htm ),
• The Food (Lot Marking) Regulations 1996 (SI 1996 No. 1502
http://www.legislation.hmso.gov.uk/si/si1996/Uksi_19961502_en_1.htm ),
• The Food Safety Act 1990 (c. 16
http://www.legislation.hmso.gov.uk/acts/acts1990/Ukpga_19900016_en_1
.htm ),
• The Trade Descriptions Act 1968 and
• The Weights and Measures Act 1985
Flavoured water is classed as a soft drink, not water, and there are no specific
regulations regarding the composition of soft drinks. Nonetheless they must comply
with:
• The Food Labelling Regulations 1996 (SI 1996 No. 1499
http://www.legislation.hmso.gov.uk/si/si1996/Uksi_19961499_en_1.htm ,
as amended by SI 1998 No. 1398
http://www.legislation.hmso.gov.uk/si/si1998/19981398.htm , SI 1999 No.
747 http://www.legislation.hmso.gov.uk/si/si1999/19990747.htm and SI
1999 No. 1483
http://www.legislation.hmso.gov.uk/si/si1999/19991483.htm , SI 2003
No.474 http://www.legislation.hmso.gov.uk/si/si2003/20030474.htm ),
• The Food (Lot Marking) Regulations 1996 (SI 1996 No. 1502
http://www.legislation.hmso.gov.uk/si/si1996/Uksi_19961502_en_1.htm ),
• The Food Safety Act 1990 (c. 16
http://www.legislation.hmso.gov.uk/acts/acts1990/Ukpga_19900016_en_1
.htm ),
• The Trade Descriptions Act 1968 and
• The Weights and Measures Act 1985
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SI 1994 No. 1486
http://www.legislation.hmso.gov.uk/si/si1994/Uksi_19941486_en_1.htm ).
This report does not examine all the above Acts and Regulations but is restricted to
those considered to be pertinent to preliminary evaluation of the opportunities for
diversification.
Definitions
• is microbiologically wholesome
• originates in an underground water table or deposit
• emerges from a spring tapped at one or more natural springs or
bore exits
• can clearly be distinguished from ordinary drinking water by its
mineral content, trace elements or other constituents and, where
appropriate, by certain effects and by its original state
• is recognised as a natural mineral water (see Recognition as
Natural Mineral Water below) and
• is bottled at source (there are exceptions for sources in production
before 1980)
• receives no treatment other than filtration (which does not alter the
composition of the water) or carbonation or decarbonation.
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The underground water table or deposit must be protected from all risk of pollution.
Water cannot be sold as “Natural Mineral Water” unless it has achieved official
recognition as such. Water from an underground water table or deposit may be
recognised as Natural Mineral Water by the district council (or London borough
council or the appropriate council in Scotland or Wales) in the area where the water is
extracted. Applications should be made in writing Environmental Health Office (See
Additional Sources of Information and Useful Contacts) and in the appropriate district
council giving:
• details of geological and hydrogeological surveys (these are used to
prove that the water originates from an underground source and
that the source is protected from pollution)
• details of physical, chemical and physico-chemical surveys (these
are required to show that the water is consistently free from
harmful microbiological impurities and that the mineral content is
stable within the limits of normal fluctuation). These surveys may
take two years to complete prior to recognition.
Spring Water
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Spring Water is not required to undergo the lengthy recognition process required by
Natural Mineral Water. Nonetheless it is required to comply with all the hygienic and
compositional requirements of the legislation.
Drinking water means water for drinking by humans other than Natural Mineral water
or Spring Water. A bottle means a closed container of any kind in which water is sold
for drinking by humans or from which such water is derived. “Bottled Drinking
Water” may use more than one source or use water from a public supply.
Labelling
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• naturally carbonated natural mineral water or
• natural mineral water fortified with gas from the spring or
• carbonated natural mineral water
• the indication ‘fully de-carbonated’ or partially de-carbonated’, as
appropriate.
Advice from Trading Standards is that a draft label should be drawn up in the first
instance and sent to the local Trading Standards department. This will be checked to
ensure all the requirements of the legislation are met and providing the opportunity
for any alterations to be made before printing.
Water Abstraction
Groundwater sources for the bottled water industry will usually be accessed via a
borehole or other works which capture the water before it reaches the ground surface.
Groundwater abstractions should comply with:
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who will assess the impact of an abstraction based on the proposed drilling location
and the quantity of water required. The following information should be provided:
• A map showing the boundary of the property, with the position of the
water source
• The type of source – e.g. borehole, well, shaft etc.
• Maximum hourly, daily and annual abstraction requirements by type of
use e.g. agriculture, private domestic, water bottling.
• The number of hours per day.
It will be necessary to advertise the intention to apply for a licence: once in The
London Gazette and once in each of two successive weeks in a newspaper local to the
area in which the abstraction will occur. The Environment Agency will provide the
necessary guidance about the format of advertisements. Costs associated with
advertising are borne by the applicant and are usually within the region of £300 to
£350.
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Currently the cost of an application is £110 in the South West. It does vary in other
regions.
The application and map must be made available for public inspection for at least four
weeks within the area local to the abstraction. The Environment Agency has a period
of up to three months in which to give its decision.
Licences are currently not time-limited, but this is under review and they may be so in
the future.
Annual charges payable following the issue of a Licence to Abstract are subject to a
minimum of £25.00 at a rate of £17.24/1000m3 (prices stated for 2003).
Two market reports (Key Note 1995 and Mintel 2001) both identify that there has
been strong growth in the bottled water market in recent years, predicting further
increases in the future. Unless otherwise stated, the following provides a synopsis of
the Mintel (2001) market report.
In 2001, the estimated total market in the UK extended to 1,550 million litres,
representing more than a 115% increase from 1998. Increased volumes and strong
competition have resulted in the price per litre falling from approximately 50 per litre
in 1998 to 33p per litre in 2001.
The bottled water market is young in the UK and, despite the strong growth, it
remains a minority market with only a third of adults using bottled water at all and
only 5.5% using it every day. Women aged between 25 and 34, ABs (see Additional
Information and Useful Contacts) and those living in Greater London are the
consumer groups with the highest consumption. Consumption is highest amongst the
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most prosperous socio-economic groups, with almost 50% of ABs drinking bottled
water compared to only 30% of C2s and only 23% of Es. Consumption by all soci-
economic groups, with the exception of ABs increased between 1998 and 2000.
There has not been a strong tradition of drinking bottled water in this country and
despite the increase in consumption in recent years per capita consumption is amongst
the lowest in Europe. The main reason for this is perceived to be the existence of a
good quality mains water supply, although concern over drinking water quality is now
considered to be one of the drivers for increased consumption.
Table 1 shows per capita consumption of bottled water in selected European Union
countries between 1992 and 1999 and the percentage change between those two years.
Italy had the highest per capita consumption in 1999 at over 145 litres per year and
the UK the lowest at 15.6 litres. Consumption increased in all countries illustrated
with the greatest percentage increase in the UK (nearly 216%). However, this was
from a very low base. Mintel (2001) suggest that per capita consumption in the UK
will increase to over 40 litres by 2005.
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As mentioned above, one of the drivers of increasing consumption is concern over the
quality of drinking water from the mains supply. Others include:
• increased concern over health
• the convergence of European lifestyles because of membership of
the European Union
• increased foreign travel
The weather has a strong influence on bottled water consumption and sales increase
dramatically during hot weather driving new drinkers and impulse buyers. However,
established water drinkers are now drinking bottled water all year round and are
unaffected by seasonality.
A recent article in the Times (11t h May 2003) indicated that the UK government plans
to transfer responsibility for deciding to treat water with fluoride from water
companies to strategic regional health authorities in England and Wales. This could
result in fluoridation of water supplies throughout England and Wales. The driver for
this is that in areas where fluoride is already added to water (Birmingham, the West
Midlands, Tyneside, Northumberland and Lincolnshire) tooth decay amongst children
has been reduced. However, this is a controversial issue and the Medical Research
Council (2002) has reported that more information about possible health risks,
including links between fluoridation and cancer, is required. It is also argued that
water fluoridation is a form of “mass medication” giving people no choice but to buy
bottled water if they do not agree. The leader article (Times, 11t h May 2003)
concludes, “If the government goes ahead with the plan, the main beneficiaries will be
bottled water companies.”
Until 1990, sales of sparkling water exceed those of still water by volume. However,
by 2001 still water accounted for 66% of the market and sales are predicted to
continue to outstrip those of sparkling water in the future, with sparkling water
continuing to lose market share.
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The industry is reported to estimate that around a third of all bottled water consumed
is now purchased on impulse. These tend to be in smaller packs and are less price
sensitive than water sold in larger packs.
The major food retailers account for the bulk of sales in this country with own brand
labels accounting for approximately 59% of the total volume sold. There are,
however, over 50 brands of bottled water available in this country and other outlets,
like CTNs (Confectioners, Tobacconists and Newsagents), petrol forecourts,
sandwich bars, health and fitness clubs, leisure centres and so on are increasing their
market share. Table 2 shows volume sales and percentage change in market share
through selected outlets in 1998 and 2001.
Table 2 Volume Sales, Market Share and Percentage Change of Market Share of
Bottled Waters in 1999 and 2001. Selected Outlets.
1998 2001 (est) % change
m litres % m litres % 1998-01
Grocery multiples 384 53.3 915 59 138.3
Grocery co-ops 15 2.1 17 1.1 13.3
Independents 13 1.8 11 0.7 -15.4
Other outlets 125 17.4 229 14.8 83.2
Sub-total 537 74.6 1,172 75.6 118.2
Hotels/restaurants 112 15.6 246 15.9 119.6
Pubs/clubs 71 9.9 132 8.5 85.9
Sub-total 183 25.4 378 24.4 106.6
Total 720 100 1,550 100 115.3
Source: Mintel 2001
Sales in licensed premises (hotels, clubs, pubs and restaurants) account for
approximately 25% of the market and prices for premium brands can go as high as
£4.50 per bottle in restaurants.
Consumers are generally not aware of the differences between “Natural Mineral
Water”, “Spring Water” and “Bottled Drinking Water” (Table Water). Brand and/or
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price are the most important factors determining selection. However, for producers,
the differences are important since the standards required for “Natural Mineral Water”
are more rigorous than those for “Spring Water”, which in turn are more rigorous than
those for “Bottled Drinking Water”.
In summary, the market for bottled water, although young and with low penetration, is
predicted to continue to grow strongly in the future. Whilst the major multiple
retailers account for the bulk of sales in this country, other outlets are gaining ground
and locally-produced water, for example, marketed in a strong tourism area through
carefully selected outlets, could take advantage of this phenomenon. The lack of
awareness of the differences between bottled water types amongst consumers suggests
that producers should examine the cost implications of meeting the relevant criteria to
identify the most appropriate product for the market.
The following are sources of further information and useful contacts, which includes
both private and public sector organisations. In the case of commercial companies,
inclusion does not represent a recommendation.
Demographic Classifications
A brief overview of social grade definitions can be found on the Businessballs
website: http://www.businessballs.com/demographicsclassifications.htm
Highland Spring
Stirling St Blackford, Perthshire, PH4 1QA. Tel: 01764 660500, Website:
www.highland-spring.com General information about water.
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International Bottled Water Association
1700 Diagonal Road, Suite 650, Alexandria, VA 22314, USA. Tel: (703) 683-5213,
Fax: (703) 683-4074, Email: [email protected] , Website:
http://www.bottledwater.org
Whilst the IBWA is ostensibly an international organisation, it is based in America
and represents the bottled water industry in the USA. The website contains
information relevant to the market in the USA and, therefore, is not directly relevant
to the market or the legislation in this country.
There are many other internet sources of information about bottled water. For
example, using the Google search engine (www.google.co.uk ), and searching for
“Spring Water”, UK sites only, over 11,000 web pages are identified.
Environment Agency
Details of Environment Agency Offices throughout the country can be found on the
Environment Agency website:
http://216.31.193.171/asp/1_search_results_1.asp?f_dataset=envagencyoffice&f_locat
ion=All%20Location
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For Cornwall and Devon, contact information at the Environment Agency is given
below
Details of all local authorities in the country can be found on the UK Online website:
http://www.ukonline.gov.uk/QuickFind/AZLocalGovernment/fs/en?CONTENT_ID=
1001101&chk=tzXGgX
Caradon District Council, Luxstowe House, Liskeard, Cornwall, PL14 3DZ. Tel:
01579 341000
Carrick District Council, Carrick House, Pydar Street, Truro, Cornwall, TR1 1EB.
Tel: 01872 224400
Kerrier District Council, Dolworth Ave, Camborne, Cornwall, TR14 8SX. Tel:
01209 614000
Plymouth City Council, Civic Centre, Royal Parade, Plymouth, Devon, PL1 2EW.
Tel: 01752 668000
East Devon District Council, Council Offices, The Knowle, Sidmouth, Devon, EX10
8HL. Tel: 013395 516551
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Exeter City Council, Civic Centre, Paris Street, Exeter, Devon, EX1 1JN. Tel: 01392
277888
Mid Devon District Council, Lowman House, Lowman Green, Tiverton, Devon,
EX16 4LA. Tel: 01884 243200
North Devon District Council, Civic Centre, North Walk, Barnstaple, Devon, EX31
1EA. Tel: 01271 388451
South Hams District Council, Follaton House, Plymouth Road, Totnes, Devon, TQ9
5NE. Tel: 01803 861234
Teignbridge District Council, Forde House, Brunel Road, Newton Abbot, Devon,
TQ12 4XX. Tel: 01626 361101
Torbay Council, Town Hall, Castle Circus, Torquay, Devon, TQ1 3DR. Tel: 01803
201201
Torridge District Council, Riverbank House, Bideford, Devon, EX39 2QG. Tel:
01237 428700
West Devon Borough Council, Kilworthy Park, Drake Road, Tavistock, Devon,
PL19 OBZ. Tel: 01822 612218
Public Analysts
The Association of Public Analysts’ website provides a list of all laboratories in the
country on: http://www.the-apa.co.uk/Laboratories/index.html
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Torbay Council, Trading Standards, Town Hall, Castle Circus, Torquay, TQ1 3DR.
Tel: 01803 201210
Plymouth City Council, Trading Standards, Civic Centre, Plymouth, Devon, PL5
2LJ. Tel: 01752 304580
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References
Key Note. 1995. Bottled Waters. Market Report. Key Note, Hampton
Leatherhead Food International. 2003. TTC Guide to Food Legislation in the United
Knigdom. Leatherhead Food Internation, Leartherhead.
Medical Research Council. 2002. Water fluoridation and Health. Medical Research
Council, London.
Mintel. 1999. Bottled Water. Market Report. Mintel International Group Ltd.,
London.
Mintel. 2001. Bottled Water. Market Report. Mintel International Group Ltd.,
London.
The Times. 2003. Secret Plan for fluoride in all water; Why put fluoride in water?
Leader: Leave water alone. 11t h May 2000
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