Firms gush over China's high-end bottled water market
Many Chinese enterprises have invested or plan to invest in the high-end bottled water market due to its strong potential, according to Shanghai's National Business Daily.
"Today, China is the most active market worldwide for bottled water, so all water suppliers want to earn a market share there," said Michael Mascha, president of the US-based Fine Waters.
With an increasing number of domestic drinking water suppliers tapping into the high-end bottled water market, the number of domestic high-end bottled water brands is already close to the number of foreign water brands.
Capital from Chinese firms has been pouring into the market with each new entry, the paper said. Evergrande Real Estate Group, one of China's largest real estate developers, is exploring projects for 10 million tonnes of middle- and high-end mineral water. In addition, a consortium formed by the Dalian Wanda Group, Flyhigh, Yifang Group and Legend Holdings spent 11 billion yuan (US$1.8 billion) to invest in a mineral water project two years ago. But the project has yet to begin.
According to CI Consulting, the profit margin of China's mineral water was merely 3.85% but that of high-end bottled water is up to seven times higher than regular water.
A CI Consulting researcher said water pollution in China has become more serious, so water sources will become rare. Many water suppliers are thus searching for new water sources and aim to obtain the sole rights of exploitation and operation for these areas.