The point-of-use water cooler system from Pure 1 that features a stationary, self-filling 5-gallon bottle on top of a cooler. The system adds chlorine to the water as it enters the bottle. The chlorine is later removed during the dispensing process through the patented filter. The system enables customers to store large amounts of chlorinated water without having to use water more quickly than it can be treated. Customers can use existing water coolers with the system.
Vendors market the fact that the Pure 1 system enables the account to have purified water at about half the cost of the removable bottles. The self-filling system also eliminates the need to store bottles and the inconvenience associated.
Brokaw Vending also has found positive acceptance to the Keurig single-cup brewer, which uses a disposable cartridge.
Vending Times Article 7'99
Pure 1 Finds Use Of Water Systems Increasing In OCS And Vending
NEW ROCHELLE, N.Y - Sales of plumbed-in water coolers for use in workplaces are rising swiftly and steadily, according to Matthew Schwartz, sales manager for Pure 1 Systems here. Demand for pure water is increasing across the board, with traditional bottled-water systems enjoying double-digit growth. Plumbed cooler volume is increasing even more rapidly, and shipments of Pure l's own "self-filling bottle" dispensers increased by over 50 percent in each of the past three years.
Pacing this acceleration is the increasing acceptance of the concept by coffee service and vending operators, Schwartz reported. Faced with growing demand for pure water, operators confront the choice between making a major investment in logistics to-handle five-gallon bottles or going with point-of-use water treatment and dispensing. The advantages of this approach, especially for beverage operators already familiar with water lines, are obvious.
Pure 1 Systems manufactures and markets the patented "Everfull" self-filling bottle system. Schwartz reported that sales grew 88 percent between 1997 and 1998, and year-to-date 1999 sales are up by almost 50 percent. "A huge percentage of those increases are in the OCS and vending fields," Schwartz told V/T.
The idea of a point-of-use water cooler is by no means new, the Pure 1 executive added. The first one was developed more than 75 years ago by W.E. Dunbar, who received U.S. patent 1,547,105 in 1922 for a system that converted a standard 5-gallon water bottle into a pour-through filter. Schwartz describes this as resembling a giant 'Brita' filter in the shape of a bottle.
Modern point-of-use coolers come in two varieties, "flat-top" designs and self-filling bottles. Schwartz recalls that the "flat-top" coolers originally were retrofits of standard bottled-water dispenser bases. Equipped with simple float mechanisms to control water flow into the reservoir, these were connected to potable water lines and provided a convenient, if not always reliable, source of chilled water.
Manufacturers began producing purpose-built "flat-top" point-of-use coolers, Schwartz continued, and today's models feature enhanced styling, more reliable float valves, and higher capacity.
Don Waters of "Take-A-Break" (Wilmington, Del.) reported that his company was selling, and renting, bottleless coolers to clients ten years ago. "What we've seen since that time is dramatic advances in the quality and appearance of the coolers, and an even more impressive improvement in water quality," he said.
The other sort of POU dispenser more closely resembles a classic bottled-water dispenser. Schwartz explained that the initial appeal of this design was entirely cosmetic. The self-filling bottle served the same purpose as the reservoir of a "flat- top" cooler, but met the end-user's desire to see the water that he or she was about to consume. Market research confirmed that the appearance of the bottle, which is a sort of universal symbol for potable water, I made it much easier for operators to place these systems. Harry Blum of Take-A-Break confirms this conclusion: "As soon as we saw the self-filling bottle, we didn't need market studies to convince us," he said. "It was obvious that this represented an easy sale."
Since then, Schwartz explained, other benefits have been added to the design. As small reverse osmosis water treatment devices became more practical and economical, the large capacity of the attached bottle- as much as ten times the size of the standard "flat-top" reservoir - became a major advantage. The self-filling bottle provides twice the capacity of the "bladder tank" commonly used with reverse osmosis systems.
The Pure 1 Systems executive emphasized that a particularly strong point in favor of the self-filling bottle design is that it performs the final stage of filtration - generally by use of a carbon filter - at the exit of the bottle. Thus, the self-filling bottle uniquely stores water that still contains the chemical disinfectant added by the municipal water authority (generally chlorine), which prevents the growth of algae and other microorganisms in the reservoir. This chemical is removed only when water is drawn off for immediate consumption or coffee brewing.
Moreover, Schwartz added, the self-filling bottle design allows for superior air filtration. Any water dispensing system must provide for air entry to replace water drawn off for use. "Flat-tops" typically employ small, porous air filters to protect the water in the tank against airborne contamination. But self-filling bottles have much more space available, and can accommodate air filters with a smaller micron rating and longer useful life.
Both systems are workable, Schwartz said, and their availability, coupled with increasing enthusiasm for good-tasting water and concern over the deterioration of municipal supplies, has opened up new opportunities for coffee service opera ors and vendors. These workplace service companies have responded by adding water to their menus, in unprecedented numbers.
HIGH MARGIN
Nelson Kirk of U.S. Office Products, Modern Vending unit in Indianapolis, Ind., explained why this is happening. "Water has been a major addition to our product line," he said. "It gives us an additional high margin product to offer our existing customers, and allows us to compete very aggressively against the major water bottlers, who have entered the coffee service arena."
Modern Vending has experience such rapid growth in placement of self-filling bottles that it now regards the Pure 1 line as one of the most important offerings of its office beverage unit, Pour-More Beverages, Kirk added.
Wes Kemble of Atkins Office products (Philadelphia, Penna.) agrees with this assessment, and adds that point-of-use coolers have made water a viable and profitable product line. "Our earlier efforts to offer conventional water bottles were a fiasco," Kemble recalled. "Our analysis showed that standard five-gallon water bottles are a nightmare to store, maintain and transport. Every sales pitch that we heard for selling five-gallon bottles only confirmed our worst fears."
Rejecting the traditional bottle concept, Atkins established a new division, Pure Point Water Systems, to market point-of-use coolers. "We have offered both bottleless coolers and self-filling bottles," Kemble explained, "and both are a major improvement over five-gallon bottles. "The self-filling bottles, especially, have been a breeze to sell, because of if the perceived value of seeing the water. Every new placement we've made over the past year has been a Pure 1 cooler."
The rise of plumbed coolers in the vending and coffee service industry is more than an American phenomenon, Schwartz reported. By marketing through vending and coffee service distributors and operators in Canada, Europe, Oceania (Australia and New Zealand), and Africa, Pure 1 Systems has nearly doubled its export sales over the past year, he said.
Pure 1 recently announced an exclusive distribution agreement for southern Africa with Top Vending of Johannesburg, South Africa (see V/T, June). Established in 1992, Top Vending has become one of Southern Africa's largest and most successful operators and distributors of vending machines and related equipment. Its newly formed water cooler division, "top Coolers," will deal exclusively in Pure l's plumbed coolers, Schwartz explained.
Top's cofounder and director Stewart Brown describes the Pure 1 line as "a natural for the vending industry." He points out that water is a high-margin product that fits nicely with existing vending methods and lines of distribution, adding value and saving money for vending clients.
Peak Drink Dispense, which distributes a full range of beverage and water dispensing products, has enjoyed similar results with the Pure 1 coolers. "Plumbed coolers in general represent an outstanding product for the automatic vending or coffee service provider," said Peak director Edmujid Winks. "We have a bias for self-filling bottlers and have chosen not to offer 'flat-tops.' However, whether offering a "flat-top" or a Pure 1 cooler, okynbed devices make particular sense for vending and OCS operators, as they already are calling upon the logical end-user location offices, factories, warehouses and the like. It is simply a matter of offering another valuable, profitable product to one's existing customers."
Chris Castellano of Andronik Vending an operation that serves the Metropolitan New York region, has found another valuable role for plumbed coolers. "We're starting to offer free coolers in lieu of commission rebates," Castellano explained. "That's a win-win for everyone involved. For example, say that we owe a customer $750 in commission. If we know that he is currently spending $1,000 a year on bottled water, we offer him a free cooler. He gets 1,000 worth of free water in lieu of $750 in cash rebates. Yet that $1,000 value may only cost us $300 to provide. We just saved $450 out of pocket.
Industry observers have noted the continuing strong growth in consumer demand for high-quality water. This is driving sales for small package water in vending and elsewhere, and of conventional bottled water systems, as well as point-of-use treatment dispensers. Thus, the self-filling bottle gives operators a service to offer that's both extremely popular and highly profitable. Schwartz observed that these advantages, coupled with the ease of selling, placing and maintaining the self-filling bottles, have made the product a valuable addition to conventional vending and coffee service lines.
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