Eden Springs takes top spot in the UK water cooler market
Eden Springs UK has achieved its stated ambition to become the country's leading 'hydration solutions' company, dislodging Nestlé Waters Powwow from the number one spot in the UK water cooler industry, according to leading drinks consultancy Zenith International. In its new market report, Zenith estimates that Eden Springs gained more than 10,000 units during 2006 through a concerted acquisition campaign, giving it a leading share of the 505,000 unit total at the end of the year. Eden also recorded a 7% growth in volume sales to replace Powwow as the leading water cooler brand in a market that saw 430 million litres consumed in 2006. The news comes hot on the heels of Israel-based Eden Springs' announcement that it is to buy out Groupe Danone from their European water cooler joint venture, Danone Springs of Eden, for 96 million euros.
"This represents a major milestone in the development of the cooler market," commented Zenith Research Director Gary Roethenbaugh. "Continued jockeying for position amongst the leading distributors shows the level of competition still at play. It also reflects a belief that there is a lot worth fighting for, even though the industry is maturing." Indeed, Zenith's latest report suggests that companies are gearing themselves up to make the most of the emerging opportunities for organic and acquisitive unit and volume growth.
"While there is an undeniable slowdown in the market, there is still plenty up for grabs – and plenty of life in the race to go out and get it," added Gary Roethenbaugh. "Leaner client portfolios, more efficient transport operations, innovations in cooler design, developments in point of use (POU), renewed focus on new customer acquisition, improving customer service and increasing throughput are reinvigorating the industry."
Emerging from the effects of a consolidation shake-out in the last few years, the industry is now poised to confront some of the major issues it faces. Large corporate accounts are close to their limit. POU installations are rising – up 24% to 188,500 units in 2006, according to provisional estimates. Sales of retail water are growing – up 8% in 2006. Meanwhile, the total number of bottled water cooler units has fallen by 2.9% over the last year and a short-lived summer did little to help boost volume sales, which dropped by 2.3%. "The message seems clear. The bottled water cooler business needs to demonstrate its competitive advantages or adapt its business model to benefit from new revenue streams, such as soft and hot drinks," Gary Roethenbaugh concluded.
Zenith's 2007 UK Water Coolers report suggests that, freed from pre-occupations with consolidation, the industry will now benefit from concerted efforts to grow the market profitably. It anticipates the market will rise slowly but steadily to 529,000 units by 2011, with consumption then reaching 455 million litres.
UK Water Coolers 2007 contains over 160 pages of market commentary, charts and tables, together with profiles of 36 leading industry players. Contact Zenith International on tel +44 (0)1225 327900, fax +44 (0)1225 327901 or e-mail info@zenithinternational.com
For further information, please contact:
Gary Roethenbaugh or Stuart Foxon, Zenith International Ltd
7 Kingsmead Square, Bath, BA1 2AB, United Kingdom
t +44 (0)1225 327900, f +44 (0)1225 327901
zenithinternational.com
