Mapping the Future
Industry leaders’ predictions for the coming year
Just as in years past, we enter 2012 with a host of changes ahead. But from new laws and regulations to emerging contaminants to the still-struggling global economy, the water treatment industry is ready to meet them. Water Quality Products asked five industry experts for their input on the challenges facing the industry this year and the opportunities they will bring.
Peter J. Censky, Executive Director, Water Quality Assn., [email protected], 630.505.0160
As I enter my 25th—and last—year as executive director of the Water Quality Assn (WQA), I hope you will permit me to offer some valedictory words of caution and optimism about our industry and to take a moment to express my deep thanks and admiration to those I have worked with. Those who have visited my office have seen model sailing ships there. They are of old, sturdy craft—small but sound. For a quarter-century, the companies and people that WQA represents have been buffeted and sometimes taken aback, but we have navigated the seas of water treatment with great success. I see real opportunities full ahead.
Bright minds have made great technological advances recently and will continue to do so. But to stay profitable, our industry needs to transform its entire mindset— to rethink how we interact with customers and public officials.
Let me try to frame one of the key issues facing us in the coming years Consumer concerns about drinking water contamination are bound to grow, leading to more opportunities for all of us, but also to new problems that we need to prepare ourselves for. Let’s look at some rough numbers.
The U.S. Environmental Protection Agency has taken decades to come up with approximately 90 primary health contaminants that can be found in water systems, but that is just the tip of the iceberg. At WQA, NSF Intl., and Underwriters Laboratories (UL) we have collectively identified approximately 1,500 chemicals that are used in the construction of just our products, not to mention all the other products that come in contact with drinking water.
We have set risk limits for these, but there are hundreds of other chemicals from personal care products that can interfere with our hormones and immune systems. These are just now being investigated The point is that there is no economically feasible way that these chemicals can be removed from drinking water except through pointof-use products. We know this, and some government leaders and scientists know this, but cities and primary regulators do not—at least not yet.
At the same time, there are research institutions around the world exploring nanotechnologies and plasma sterilization technologies that will revolutionize space exploration, transportation, computer technologies and even water treatment. I think I can count on two hands the number of new technologies that have entered our industry in the past 25 years. That is about to change in a huge way.
Both of these trends—the dramatic rise in the number of contaminants that must be regulated and the sudden influx of new technologies—will be enormously disruptive to everyone in the water industry. I include in that large group regulators, municipalities, engineers, manufacturers and especially dealers.
We are entering a new era that will be governed by the speed of change. So how do you keep up with it? First, let’s be honest. There is no single person, no company “family” that can keep track. The only way is for you to be a member of WQA and to use that investment to stay informed.
Second, get your people certified. This will be one of the things that separates the winners from the losers in the future. What do consumers, regulators, city governments and businesses know about water? Precious little, so they have to depend on other sources. Professional certification is the only way you can establish your credibility. We all know there are still some flim-flam operators out there. The only way to differentiate yourself is to invest in professional certification. Naturally, I strongly believe we need to take a leadership role.
I will be continuing on the lookout deck of the ship for a while longer, doing what I can to help see these changes and challenges through. But as this will be my final industry forecast, let me end by saying here how grateful I have been for the opportunity to serve an industry that helps provide millions of people with the fundamental stuff of life and that does its job with intelligence and integrity.
There are too many individuals to thank here—board members, staff, supporters—so for now let me offer up a final piece of nautical advice, which I think is particularly appropriate for our industry: Let’s keep the wet side down!
WATER: MORE PRECIOUS THAN GOLD
Frank A. Brigano, Ph.D., Vice President, Technology, KX Technologies LLC, [email protected], 203.764.2506
Last year brought many challenges, from economic to environmental. Although many of us are North American-centric, the reality is we are all members of a global society and economy in which we share the same finite resources. Managing those resources for the good of all should be a priority. In our “me” society, we must remember it is really only one-seven-billionth about “me.”
The availability and quality of water dominated the news last year Mother Nature was responsible for an accidental release of radioactive materials to the environment. In addition, manmade and natural contaminants continued to taint the global water supply for drinking and agricultural use.
Global Water Solutions
Although the water treatment industry cannot control Mother Nature, it can provide global solutions for clean, safe drinking water. Technologies exist today to provide treatment solutions for almost every water contaminant in virtually all water types around the globe.
One problem in addressing global filtration technologies is that many parts of the world require point-of-use (POU) systems that can operate in low-pressure scenarios. There are technologies in the marketplace that can provide microbiologically safe drinking water and also reduce heavy metals and organic contaminants and improve water taste at gravity and low pressures. Low-pressure and gravity water treatment solutions prove to be a challenge, however, especially on water of unknown quality.
For example, India has specific guidelines regarding distributed water quality, but the water is not always safe to drink. Unfortunately, Indian water delivery often is intermittent Reduced pressures in water mains during “off periods” can facilitate the intrusion of contaminants into distributed water.
To ensure a constant supply of water, most Indian consumers have rooftop storage tanks. Consumers’ water quality and pressure are largely dictated by their storage tanks—the water pressure in the home is determined by the height of the water tank and its water level. Typical water pressures in an Indian home range from 0.2 to 0.7 bar (3 to 10 psi), rendering many conventional filtration devices ineffective without a booster pump.
If the rooftop tank water supply is not properly secured or sealed, it can be impacted by birds, animals and debris, possibly resulting in contamination by microorganisms. Consumers are fortunate if these tanks are cleaned on a yearly basis. Water temperatures in the tanks can reach 55°C (131°F), which can contribute to microbial growth. Microbiological contamination is typical—in fact, our microbial analyses of water from these systems showed a plethora of microorganism species, including coliforms.
Many families around the globe rely on gravity systems to supply their drinking water. New technologies developed specifically for gravity applications can deliver microbiologically and chemically safe water. Unfortunately, these waters are often high in silt and other organic particulates that can shorten the life of the filter. Technologies that can reduce these contaminants and continue to supply potable drinking water given these unusual water characteristics will prove vital.
These technologies must also have an appropriate service life. Many cultures measure filter life in terms of time and not the amount of water processed. There is a propensity in some cultures to clean and reuse the filter element. It will be a challenge to our North American cultural paradigm to provide safe, reliable products to these populations.
To secure the safe performance of POU systems, the water treatment industry continues to take the lead in developing testing protocols and standards. We salute the Water Quality Assn. (WQA) and NSF Intl. for leading product testing protocol development in India and other countries. These efforts should ensure a level playing field for manufacturers, and more importantly, provide safe, reliable products to consumers.
Experience has taught us that while water may leave a treatment facility meeting drinking water standards, infrastructure plays a significant role in water quality at the tap. In the U.S., there will be more emphasis on improving and maintaining infrastructure in the coming years. The need to refurbish and upgrade the nation’s water distribution infrastructure is evident in the increasing number of boil water alerts throughout the country due to microbial and chemical excursions.
Consumers will use POU products as solutions to contamination from distributed water. The government must reach a definitive resolution on the use of POU systems for compliance purposes, as it no longer makes sense to treat all water to potable standards for the few liters of water consumed per person per day for drinking and cooking.
The goal of our generation should be to leave an environment and a culture that will allow future generations to prosper. Efforts to measure and document our products and their effects on resources are critical to the sustainability of our environment and resources. Product sustainability and how it is measured is a daunting task. The water treatment industry has efforts underway to provide sustainable metrics for its products. Next year promises significant progress in developing these methodologies.
Protecting our environment, preserving our natural resources and providing for the well-being of future generations is everyone’s responsibility. The water treatment industry can contribute successfully to these goals by developing innovative, sustainable water treatment solutions. Furthermore, we must provide technologies that can provide microbiologically and chemically safe drinking water globally.
Rick Andrew, General Manager, Drinking Water Treatment Units, NSF Intl., [email protected], 734.913.5757
In the Water Quality Products 2011 Industry Forecast (“What’s on the Horizon? 2011 Industry Forecast,” January 2011), Tom Bruursema, now general manager of NSF sustainability, highlighted the growing momentum in water reuse initiatives. While I certainly see that trend gaining traction in 2012, I would like to highlight another trend that impacts many manufacturers and dealers: globalization.
Globalization affects the industry in two main ways, both of which have been increasing in their impacts on the industry over the last several years.
First, there is globalization of product, material and component sourcing. Increasingly, OEMs source globally instead of locally, regionally or nationally. There are several considerations when expanding sourcing options. As suppliers move farther away, issues such as reliability of supply, shipping costs and quality become more challenging to monitor and control. Relationships with suppliers are important, and can take time to build. Product certification can add value in these situations, as it provides increased assurance of product quality and meeting of specifications.
Second, there is globalization of sales and distribution. More and more, we are seeing manufacturers develop sales and distribution channels for their products in new regions and countries. There are many challenges when expanding geographically. As with suppliers, relationships between manufacturers and distribution partners in these new areas are critical, and take time and effort to develop.
Understanding and complying with local regulations also can be difficult, time consuming and expensive. Working with a partner that has expertise in global regulatory requirements can add significant value for manufacturers that do not have the resources or desire to build this knowledge internally.
Looking beyond 2012, I see this trend accelerating, producing opportunities and risks for all players in the global water treatment market. Those who look forward and act accordingly will be well served by this new world of possibilities, whereas the risks of failing to recognize the trend and act on it may prove damaging to those who do not.
A DEALER'S PERSPECTIVE
Mike Guidara, CWS-II, President, Truckee Meadows Water Systems Inc., [email protected], 775.324.2001
There will always be a need for clean water, and 2012 will be a good year for most of the established water treatment companies across the U.S. Success will be mostly contingent on how the economy is doing in each dealership’s geographic location.
I cannot speak for all dealers since every market is different. Truckee Meadows Water Systems (TMWS) is located in Reno, Nev., where unemployment is hovering around 14%, home prices are still dropping and foreclosures are the norm—but some people are still buying water treatment equipment. In fact, our sales increased in 2011.
TMWS’ key to success in this economy is diversification. October 2011 was the first month in 10 years that we did not sell a water softener, but in terms of sales, it was the best October we have ever had. The reason is sales of other types of products and services: service calls, point-of-entry arsenic filters, carbon tanks, reverse osmosis systems, deionization tanks, point-of-use water coolers, office coffee services, cups, ozone systems and shower filters.
In 2012, it will be business as usual for TMWS. But because Nevada has led the nation in foreclosures for 57 straight months, we will need to work smarter and harder.
To me, water treatment dealerships are like professional sports teams: Each starts with a good arena, a proactive owner, strong management and a well-trained, disciplined team. I feel that if we can put together a great team of friendly experts, we will be successful in this industry regardless of market conditions. We have a big banner at TMWS that says it all: “Make Plays—Not Excuses.”
My prediction is that 2012 is going to be just like the past few years. From what I see, most established businesses are still open and their employees are still cashing their paychecks, so even though the “piece of pie” is smaller, it still exists.
To be successful in 2012, we must:
- Take care of existing customers’ needs and take a proactive approach to equipment service and maintenance that in the past probably was not a high priority;
- Ensure that our routing and equipment software is up to date;
- Ensure that our company’s public image makes us the preferred dealership to do business with;
- Be prudent with advertising dollars and hire sales representatives that can set up display booths at home shows and community events;
- Ensure that we can find new customers at an affordable rate via the Internet and other advertising;
- Keep overhead low by getting bids on almost everything we purchase;
- Increase efficiency by having service technicians drive fewer miles, complete more service calls and sell more off of the truck;
- Streamline our office procedures and keep employees’ continuing education up to date;
- Find safe, affordable ways to lower pH to extend the life of arsenic filtration media; and
- Be proactive and not reactive by finding emerging technology that makes existing water treatment equipment obsolete.
Good luck and best wishes to everyone in 2012.
FULL SPEED AHEAD
Joe Doss, President & CEO, International Bottled Water Assn., [email protected], 703.683.5213
In 2012, the International Bottled Water Assn. (IBWA) and the bottled water industry will continue to work proactively to communicate the facts about bottled water to consumers, legislators and the media, and defend the industry against any gratuitous attacks. We see significant opportunities both to tell the positive bottled water story and to continue to provide consumers with a safe, healthy, convenient and refreshing product. In 2011, bottled water consumption increased in both the HOD and PET segments of the market. We expect this upward trend to continue in 2012.
A strong bottled water industry will continue to have positive effects on the U.S. economy in 2012. Research conducted for IBWA in 2011 showed that bottled water companies in the U.S. employed more than 145,000 Americans, paying them $6.9 billion in wages and benefits and generating an additional 499,241 jobs in supplier and related industries. In fact, the total economic activity for the bottled water industry in the U.S. in 2011 was $109.8 billion.
In 2012, IBWA will work with other food industry allies to ensure that regulations promulgated by the U.S. Food and Drug Administration (FDA) to implement the new Food Safety Modernization Act do not pose an unreasonable burden on bottled water companies. This new law, which expanded FDA oversight, contains four main areas of focus: more frequent FDA inspections, mandatory recalls, hazard analysis and identification of preventative controls, and records maintenance and access.
Expect to hear more about IBWA’s Material Recovery Program (MRP) in 2012, as we step up our promotion of this collaborative new joint venture between business and government. The MRP aims to assist states in developing new, comprehensive solutions to manage solid waste in U.S. communities by having all consumer product companies—not just in the bottled water industry—work with state and local governments to improve recycling and waste education and collection efforts for all packaged goods. The extended producer responsibility concept is expected to expand significantly in the U.S. in the coming years, and as we explore additional and more cost-effective ways to increase the recycling rates of all packaging materials and consumer products, we now have an opportunity to be a significant contributor to this important conversation.
In 2012, the bottled water industry will continue to find ways to decrease its environmental footprint. Over the past eight years the gram weight of the 16.9-oz single-serve PET bottled water container has dropped by 32.6%. As a result, more than 1.3 billion grams of PET resin have been saved by the bottled water industry through container light weighting. Our industry also is developing new technologies in product packaging, such as the use of recycled content, biodegradable and compostable materials, and is utilizing more fuel-efficient means
IBWA continues to support efforts to provide bottled water to victims of natural and other disasters. In 2011, our members provided large quantities of bottled water to relief efforts after tornados, floods, hurricanes, wildfires and other natural disasters struck in the U.S. Bottled water companies around the world also responded to the need for clean, safe water after the massive earthquake last year in Japan. As always, the industry stands ready to assist whenever there is a need for clean, safe bottled water.
In 2012, expect to see continued efforts by bottled water critics to prohibit its purchase by state and local governments. We also expect ongoing issues such as taxes, attempts to ban the use of bisphenol-A, and bottled water container deposits to remain a focus for anti-bottled water and environmental activist groups. As always, IBWA will defend the interests of the bottled water industry by working to defeat any unreasonable proposals.
The bottled water industry has a great story tell. We continue to work hard to create a favorable business and public affairs climate for the bottled water industry and to protect and advance the interests of all IBWA member companies. Our many successes throughout the years can be attributed to a strong and continuing team effort that includes IBWA bottlers, suppliers, distributors, staff and consultants. We look forward to an exciting 2012.