The Challenges of Bottled Water Bottled water has been getting a by dla17169

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									Bottled Spring Water Brief                      December 7, 2008                                    Page 




The Challenges of Bottled Water




Bottled water has been getting a lot of attention lately- much of it negative. Water’s weight of 
kilogram per liter makes it a heavy commodity, and one that is energy intensive to distribute inter-
nationally. In fact, Triple Pundit Sustainability Engineer and MBA Pablo Päster discovered that “the
manufacture and transport of a one liter bottle of Fiji water consumed 26.88 kilograms of water, 849
Kilograms of fossil fuel and emitted 562 grams of Greenhouse Gases”. Unfortunately, it doesn’t end
there. Most bottled waters are packaged in PET bottles- a material that has been found to leach tox-
ins such as antimony into the water being held. Proven effects of antimony poisoning in small amounts
include headaches and depression. Although these PET plastic bottles are recyclable, Americans
recycle only 25% of the containers. This number is far surpassed in Japan, where 69% of bottles
were recycled in 2007. This recycling can help reduce waste, but the processes involved require
large amounts of energy. A better solution can be found in reusable containers. Thanks to an estab-
lished infrastructure of bottle dealers, who pick up, wash and deliver the bottles back to the beverage
industry, beer bottles in Japan have a remarkable 99% rate of return. According to research done by
the Japan Center for Climate Change Actions, “if all beverage containers in Japan were replaced by
returnable bottles, CO2 emissions would be reduced by about 57 percent and solid waste by about
,250,000 tons compared with current levels.” A unique and powerful market opportunity exists in
addressing these challenges head on, and DBA has outlined a handful of possible solutions in the
following pages.
Bottled Spring Water Brief                      December 7, 2008                                   Page 2




Ecological Factors: Distribution




Mineral extraction and localized water sourcing:


Delivering water around the world presents a significant ecological challenge in the form of a large
carbon footprint and pollution produced during shipment. In order to manage this issue, one potential
solution is to shift the focus of the product away from water as the defining factor of the brand to one
featuring the mineral essence of the water source. In this scenario distilled or deionized water would
be sourced regionally according to where the water is being distributed and then the unique minerals
derived from the original spring would be added during bottling. Thus the essence of the product
becomes the mineral additive and less the water itself.


Such an approach would save enormously on shipping costs, pollution and carbon footprint while
developing a novel marketing approach that emphasis ecological responsibility and unique brand
attributes. Secondary market opportunities also become available in the sales of health and beauty
products such as bath minerals and demineralized water.



Bottle Take-back


In Japan, glass bottle take-back programs are very common and have reached levels of over 90% of
return and reuse. If developing packaging for the specific market geography of Japan the most eco-
logical option is certainly glass bottles designed to be recollected and reused. According to available
information, standardized packaging for beer and sake are used to encourage bottle reuse, but are
limited to colored glasses which may not be ideal for marketing water.



Refilling Stations


To reduce disposed packaging quantities, large mineral water refilling stations can be implemented
in select retail environments. These stations could be outfitted with a pay-per-liter system, along with
an intuitive, ergonomic interface for the refilling process. The overall experience of using the stations
would correspond to the healthy, refined, and responsible attributes of the brand as a whole. Due to
their physical presence, the stations can also offer an opportunity for strong in-store branding and
advertising.


Carbon Offset Credits


Additional ways of managing the carbon footprint issue of international distribution include carbon
offset credits. Though not an ideal solution (a number of ecological based criticisms have been raised
in the media), this method does help to offset the environmental impact of shipping and produc-
tion. Other water companies have already started using carbon offset credits to answer criticism of
long-distance shipping. For example, in an attempt to assuage criticism from environmental pundits,
Fiji water has begun purchasing 20% carbon offsets resulting in marketing claims for a net positive
carbon impact. Following in this line of thinking, carbon offset credits should be considered as a
component of the overall ecological responsibility strategy.
Bottled Spring Water Brief                      December 7, 2008                                   Page 




Ecological Factors: Packaging




Approximately 75% of water bottles are not recycled in the US and 0% in japan. It is therefore criti-
cal that the bottle packaging be designed to engage with the post-consumption life of the product.
Additionally the leaching of dangerous chemicals such as antimony for PET bottles is a health
concern that should be avoided when possible. A number of possibilities exist to reduce the impact
of water bottles:


Localization


In order to address the recycling systems of various market regions, the packaging can be made
most ecologically by designing it to match the local infrastructure. For instance, in Japan utilizing the
existing glass bottle take back system would provide the most responsible solution, while in the US a
lightweight recyclable plastic bottle may be best.



Materials


Glass:


There is a trade-off to be made in choosing plastic or glass bottles. Glass is considered healthier
since it will not leach harmful chemicals into the water and is easy to recycle. However, the carbon
footprint is significantly increased due to the extra weight as compared to plastic. Therefor, it is best
to only use glass for domestic distribution where shipping is not a significant factor. Glass has the
further advantage of reuse - if designed properly, the packaging can be made to encourage reuse by
the consumer in order to reduce the material volume ending up in the waste stream.


Plastics:


PET is the most commonly used plastic for beverage containers and is also one the most recycled
plastics. Recent studies show that PET leaches toxic antimony into the beverage over time and poses
some health risks. Conversely, plastic bottles offer a reduced carbon footprint in comparison to glass
that may have a net environmental advantage.


Alternative Materials:


With further R&D, other material options may come to light that offer advantages over traditional PET
bottles. Initial research reveals one form of traditional packaging - wax paper bottles - may have a
number of ecological advantages over plastic or single-use glass. Further development in this area
may lead to new types of beverage packaging that would define the product as both ecological and
innovative.
Bottled Spring Water Brief                      December 7, 2008                                  Page 4




Ecological Factors: Power & Heating




Geothermal power generation utilizes the naturally occurring heat in the ground to fuel a number
of different electricity generating technologies. In the past, water temperatures over 200 degrees
Celsius were required for efficient generation to be viable, however new developments in geother-
mal research now allow for the successful functioning of geothermal power generation from lower
temperature sources. By utilizing one of these techniques in the Arifuku water facility, the organization
can dramatically reduce the emissions of the factory, foster a positive image, as well as save a great
deal of money in the long run. Its also worth noting that the Japanese government provides consider-
able support for new Geothermal projects in the form of subsides and consulting. ANRE, the Agency
for Natural Resources and Energy plays a crucial role in the development and utilization of geothermal
energy in Japan.
                                Bottled Spring Water Brief                         December 7, 2008                   Page 5




                                Viable materials for disposable water packaging




                                      Glass                  PET         HDPE             Aluminum     Steel   Waxed Paper




Possibility of consumer reuse           +                                   +                  +        +

Take-back program in Japan              +

Recyclable in Japan *                   +                    +              +                  +        +

Doesn’t leach toxins                    +                                   +                  +        +          +

Doesn’t leach flavor                    +                                                      +        +          +

Clear                                   +                    +              +                                      +

Lightweight                                                  +              +                  +                   +



                                Up to 80% of municipal waste is incinerated,
                                making biodegradability irrelevant


                                * HDPE is downcycled, or reprocessed
                                together with other plastics into a low quality,
                                non-recyclable composite
Bottled Spring Water Brief   December 7, 2008   Page 6




Pros & Cons
Bottled Spring Water Brief                     December 7, 2008                                  Page 7




Scenario 1




Standardized Bottle for Existing Take-back System


The existing infrastructure for bottle take-back in Japan provides an inexpensive ecologically respon-
sible opportunity for localized water distribution, utilizing standardized beer and sake packaging.




 Product / Marketing                            Mineral extraction and localized water sourcing

 Localized Packaging

 • Japan                                        Use existing glass bottles designed for take-back
                                                program infrastructure

 • International                                Packaging to be developed based on the regional
                                                infrastructure

 Distribution                                   Option to implement refilling stations at store for
                                                self-service bottle refilling.

 Carbon offset credits



 Pros                                           Cons

 • No cost for bottle development               • Very limited ability to customize bottle
 • No Cost for bottle production                • Existing bottles may have market associates with
 • Glass bottles do not leach                     beer and sake
 • Low eco-impact because of bottle reuse       • Small bottle cleaning costs
 • low carbon-footprin because of localized
   water supply
Bottled Spring Water Brief                     December 7, 2008                                  Page 8




Scenario 2




Custom Bottle Take-back Program


If a custom glass bottle is desired, development and production of a glass bottle requires investment.
As well, the implementation of a take-back program will require investment but will save on production
costs in the long-term. The custom bottle can be design will further extend marketing opportunities.




 Product / Marketing                            Mineral extraction and localized water sourcing

 Localized Packaging

 • Japan                                        Custom glass bottles designed for personal reuse
                                                and take-back implement bottle take-back and reuse
                                                program for custom bottled design.


 • International                                Packaging to be developed based on the regional
                                                infrastructure

 Carbon offset credits



 Pros                                           Cons

 • Custom bottle is great marketing op-         • Complex and more costly to develop take-back
   portunity                                      infrastructure in Japan
 • Glass bottles do not leach                   • Setup costs to develop and produce custom bottle
 • Low eco-impact because of bottle reuse       • Reduced reuse of bottles due to non-standard
 • Low carbon-footprint because of localized      bottle
   water supply
Bottled Spring Water Brief                     December 7, 2008                                  Page 9




Scenario 3




Custom Bottles Designed for Personal Reuse


A reusable custom glass packaging design creates the possibility for extended useful life prior to
recycling and avoids investment required for a take-back system.




 Product / Marketing                            Mineral extraction and localized water sourcing

 Localized Packaging

 • Japan                                        Custom glass bottles designed for personal reuse
                                                and regular glass recycling


 • International                                Packaging to be developed based on the regional
                                                infrastructure

 Carbon offset credits



 Pros                                           Cons

 • Custom bottle is great marketing op-         • Setup costs to develop and produce custom bottle
   portunity                                    • Reduced reuse of bottles
 • Glass bottles do not leach                   • Recycling glass bottle is energy intensive
 • Low eco-impact because of bottle reuse       • Larger carbon footprint from centralized mfg and
 • Low carbon-footprint because of localized      distribution of bottles
   water supply
Bottled Spring Water Brief                       December 7, 2008                                  Page 0




Scenario 4




Custom eco-friendly PET plastic bottles for international use


Non-reusable custom plastic bottle option provides a lightweight recyclable alternative to glass
packaging. Distribution becomes less ecologically harmful because of decreased weight. Water
distribution is more localized than traditional practices, so the weight of water isn’t a factor for ocean
shipping.



 Product / Marketing                              Mineral extraction and localized water sourcing

 Standardized Packaging                           Lightweight PET bottles designed for landfill biode-
                                                  gradability and recycling.

 Carbon offset credits



 Pros                                             Cons

 • Low carbon-footprint because of localized      • Leaching of antimony into water
   water supply                                   • One time use bottle is energy intensive
 • Custom bottle is great marketing op-           • 25% (japan) to 70% (US) bottles are not recycled
   portunity                                      • Increased carbon footprint from centralized mfg
 • Reduced carbon-footprint because of              and distribution of bottles
   lightweight packaging                          • Plastic is harmful to wildlife
 • Landfill biodegradable & recyclable            • Cost of developing and producing bottles
                                                  • Leaching of plastic chemicals into water
Bottled Spring Water Brief                      December 7, 2008                                 Page 




Scenario 5




Custom eco-friendly PET plastic bottles with standard distribution


The least ecological option utilizes custom recyclable plastic bottles that are filled then shipped
across the ocean.




 Product / Marketing                             Standard water bottling and distribution

 Standardized Packaging                          Lightweight PET bottles designed for landfill biode-
                                                 gradability and recycling.

 Carbon offset credits



 Pros                                            Cons

 • Custom bottle is great marketing op-          • One time use bottle is energy intensive
   portunity                                     • 25% (japan) to 75% (US) bottles are not recycled
 • Reduced carbon-footprint because of           • Increased carbon footprint from centralized mfg
   lightweight packaging                           and distribution of bottles
 • Landfill biodegradable & recyclable           • Plastic is harmful to wildlife
                                                 • Cost of developing and producing bottles
                                                 • High carbon footprint due to centralized water
                                                   source
                                                 • Leaching of plastic chemicals into water
Bottled Spring Water Brief                      December 7, 2008                                  Page 2




Conclusion




A unique and powerful marketing opportunity emerges when we address the ecological challenges
of bottled water. By creating the only bottled water that is as healthy for our environment as it is for
us, Arifuku can innovate beyond existing paradigms to fullfil the demands of evolving contemporary
culture.

								
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