Vending Times Article 3'98:
Pure 1 Systems Helps Operators Provide Profitable Water Service
NEW ROCHELLE, N.Y - Operators long have recognized the appeal of water to coffee service and, increasingly, to vending locations as well. More and more clients want to provide treated water as part of their employee refreshment program, as concern grows over the deterioration of municipal water supplies. And these clients usually would prefer to obtain that water from the company that provides their coffee or vending service. But the logistics of the traditional bottled-water delivery business too often prove to be more trouble than the business is worth.

Pure 1 Systems here reports that the emergence of 'self-filling bottles' - point-of-use water treatment systems that look like traditional 5 gallon water bottles - have replaced the burdensome task of delivering water in bottles, and collecting the empties, with a simple one-time installation followed by quarterly or semi-annual filter changes.

The swift acceptance of these pure water delivery systems by the workplace service industries owes much to Pure 1s work in establishing a presence in OS and vending. The company showcased its technology at last year's National Automatic Merchandising Association and National Coffee Service Association annual trade shows, and is scheduled to exhibit at the upcoming NAMA Western show and the 1998 annual exposition.

Operators encountering Pure 1 Systems "Everfull Self-filling Bottle" quickly recognized that they can sell or lease 'bottled-water" equipment without incurring the high overhead expense inherent in traditional bottled-water distribution.

One company that has taken advantage of this opportunity is Modern Vending/Pour-More Beverages (Indianapolis, Ind.), whose president, Elliott Nelson, was one of the first operators to discover Pure 1 .

'We tried bottled water, but it was just too difficult," Nelson said. "We also tried "bottle-less" coolers, but the customers still wanted to see their water. Then, in walks Pure 1, with a plumbed system that still has a bottle, costs less than the 'bottle-less' coolers, and can also be used with any bottled-water cooler. It was a natural fit."

Until last year, Pure 1 has focused primarily on the export market; in many countries, the firm's disinfection and purification technologies offer special benefits. Domestically, its filtration and reverse-osmosis demineralizing products had been marketed principally to the water treatment market. Therefore, vending and coffee service operators interested in selling or leasing self-filling bottle systems often could not locate the manufacturer. They purchased their equipment from Pure 1's "private label" customers, often paying a hefty upcharge on the price that Pure I charges directly.

"We definitely had a "lose-lose" scenario," said Matthew Schwartz of Pure 1 . "Operators paid higher prices, reducing their volumes and raising the prices that they were forced to charge endusers." By purchasing from Pure l's customers at inflated prices, he said, many operators came to regard the systems as overpriced which could not be further from the truth.

"In fact, Pure 1 offers the lowest priced P.O.U. coolers anywhere," Schwartz emphasized. "Where else can you buy a filtered P.O.U. cooler system for less than the cost of most popular coffee brewers?"

Many operators among the growing base of Pure 1 workplace-service dealers agree with this assessment. 'We had looked at the Pure 1 concept before, and thought it was a tremendous idea, "Nelson recalled. "But, at first, we didn't know that Pure 1 existed. We were looking at the product through resellers, and we thought that it was just a bit too expensive. When we finally found Pure 1, the whole cost-benefit analysis changed dramatically. What you have now is a niche product that is pure profit. It serves the end-users's needs, and it makes a lot of money for the operator."

Dave Flanders of Cooler Waters in Connecticut had been buying the equipment from a Pure 1 reseller until recently. "We had been making a nice return at double the cost," he said. 'Now, we spend half as much, and receive better service and technical support." Like Nelson, Flanders had never heard of Pure 1 ; "Now, everyone in the industry seems to be talking about them," he added.

This is true of coffee service market leaders too. Rich Coast Coffee of Central Pennsylvania is one of them. "Rich Coast had previously considered the bottled-water business," Schwartz reported, "both as an opportunity for growth and as a defense against local water companies' efforts to add coffee service to their lines." Pure 1 offers the company the opportunity to sell "bottled" water, for less money and at higher margins, without any heavy bottles to store, deliver and collect. 'They haven't been at this very long, but they tell me the customer reaction has been tremendous," Schwartz said; "especially because of the appearance. They're really very excited about working with us, and we about working with them."

TKO Brokerage covers the Southeastern United States for Pure 1 Systems, and veteran broker Ken Bible has found that this excitement is a common response, "This was a product that I only had to see once to be sold on," Bible said, "and my customers mostly have the same reaction."

The uniqueness of Pure 1, Bible said, also helps his operator customers' core businesses. "What starts out as a new product quickly turns into a door-opener for many operators - a unique niche that allows them to call on new end-users," he explained. For example, locations that are happy with their present refreshment service would not be prospects for another operator, unless that operator approached them with a new solution to a perceived need. "For these kinds of folks, Pure 1 is not just a profitable opportunity to sell water, but a great chance to break the ice," he pointed out.

RDR Vending Sales (Philadelphia, Penna.) represents Pure 1 in the Mid-Atlantic region, and that company's Denise Wolfrom is encountering the same reaction. "I haven't met one operator - even the ones who aren't buying who doesn't think that the traditional bottle appearance isn't a great marketing advantage," she said. "This is just a very smart idea for this industry."

Mainstream Coolers of New York has been a Pure 1 dealer for a year and a half, after first considering other P.O.U. suppliers. "We find Pure 1 to be the best deal around," said president Peter Neill. "Not only are these bottled systems less expensive than 'bottle-less' flat-top coolers, but the bottled-water appearance makes the salesman's job a lot easier." Neill found the concept so compelling that he is considering conducting independent training seminars for new and prospective Pure 1 customers.

Schwartz, who is Pure 1's national sales manager, attributes the company's rapid emergence to "good brokers, good products and good timing." However, he noted, there are still large territories in which sales growth is not what it can be. "Back East, and through the Midwest, we've been able to hook up with brokers who quickly came to believe in the product. Out West, for whatever reason, we still haven't achieved that point.-

WESTERN EFFORT

Seeking to duplicate Pure 1's Eastern success out West, Schwartz decided to exhibit the system for the first time at the Western NAMA show in Long Beach this coming April. "Unlike most shows that we do, we're not going to network that's proven so successful closer to home."

The company is confident that it will succeed in this effort. Pure 1 chairman and chief executive officer Steven Singer sees an analogy between point-of-use water treatment technology and computers, "Twenty-five years ago, you needed entire rooms to house computers that were rudimentary by today's standards," he observed. "As technology has advanced, today's lap-top computer can do more than those big mainframes did, and do it faster and more cheaply." Similarly, "We now can do, in the bottle and for less money, more than an expensive treatment plant did, not too long ago," he explained.

Pure 1 founder, president and technical director Carl Sutera sees the "Everfull" bottle as the key. "The 'Everfull' lets us do what nobody else does - store the water with chlorine from your municipal water supply still in place, and remove it when you dispense through a filter located in the exit of the bottle."

"That process, and the three patents we hold, make us uniquely able to offer the different systems needed to address any water treatment challenge," Sutera emphasized. These systems range from simple filtration, chemical disinfection, and reverse osmosis to ozonation. "Nobody else offers that breadth of treatment options," he stated.

"The fact that our systems give the comfortable appearance of traditional bottled water - the ability to see that the water is crystal clear - doesn't hurt, either," Schwartz added.

Pure 1 Systems, headquartered in New Rochelle, N.Y., develops, manufactures, markets and sells a wide range of drinking-water treatment systems including point-of-use cooler products. It is a supplier member of the National Automatic Merchandising Association, the Water Quality Association and the International Bottled Water Association. The company can be reached by calling (914) 235-8800 or faxing to (914) 235-8849; e-mail may be sent to sales@purel.com, and it maintains a Web site on the Intemet at www.purel.com.

 

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