Business Development for the Private-Label Bottled-Water Industry

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The private-label bottled-water industry is exciting and has tremendous growth opportunities and the ability for suppliers to offer their customers and strategic partners creative, effective advertising solutions.

But like any business, care is required to develop the business in a profitable way, and the best way to do this is to establish a focused business-development effort that utilizes the tools and techniques established by successful businesses.

The first step is to define the concept "business development."



Definition:
[Business development] includes a number of techniques designed to grow an economic enterprise. Such techniques include, but are not limited to, assessments of marketing opportunities and target markets, intelligence gathering on customers and competitors, generating leads for possible sales, follow-up sales activity, formal proposal writing, and business-model design.

Business development involves evaluating a business and then realizing its full potential using such tools as marketing, sales, information management, and customer service. For a sound company able to withstand competitors, business development never stops but is an ongoing process. (Wikipedia)
From this definition, it is clear that business development is more than closing the sale, and each technique requires detailed planning and follow-up.

Using the concepts of business development, our company developed a robust, profitable private-label water business, but it took considerable initial and continuing effort.

Unique Value Proposition:

Our first challenge was the development of a unique value proposition that answered the question, "Why should I buy from you?"

After a review of the market and the competition, it was determined that private-label bottled water was a powerful, cost-effective advertising vehicle, but because a customer's brand was affected, high-product quality and customer service were required. Our unique value proposition was established and stated:

"Element H2O will provide powerful and cost-effective advertising and brand promotion for its customers based upon the highest-quality consumable private-label water, label design, and customer service."

Marketing and Target Markets:

Field and Internet research was conducted with this basic question: what are the characteristics of the industries that are most likely to use our product at a price that is profitable to us? Key characteristics were developed:
  • Prospects that provided quality products or services
  • Industries that operated in competitive market environments where product/service differentiation was critical
  • Prospects that required drinking water for customers, clients, or prospects
  • Prospects that maintained quality brand images
Initial research indicated that the following industries were initially high-potential targets:
  • Hospitality (hotels and spas)
  • Banking
  • Mortgage brokers
  • Real estate
  • Ski resorts
Sales Channels and Market Access:

It was decided that two channels would be used to go to market—direct selling and e-commerce. An e-commerce site was developed that allowed customers to design their own labels for the bottles or provide existing designs consistent with customer brand strategies. Search-engine marketing and optimization techniques were used to promote this channel.

A direct-sales staff was formed to develop and close sales opportunities, and these efforts were supported by a direct-mail campaign and networking with local chambers of commerce, local trade associations, and lead-sharing groups.

The sales effort, after a series of initial false starts and disappointments, matured successfully as we reviewed and revised the fine points of our effort.

Product Quality and Customer Service:

Our corporate strategy for all products is to stay at the high end of the market, and this was particularly true for private-label bottled water, where the market is characterized by cutthroat competition and many low-quality vendors who are slashing prices and selling on price rather than quality.

We focused on three areas of quality:
  • Water purity—we used a steam distillation/ozonation process that guaranteed 99.9% pure water that tasted delicious.

  • Label design quality—we used an in-house professional designer to guarantee label design quality.

  • Label print quality—we used laminated label stock that was extremely durable and waterproof and used digital or flexo-printing technology to guarantee quality.
Customer service was particularly important as we established a reputation for delivering on time and delivering correctly. If mistakes occurred, and they did, we adopted a no-questions-asked guarantee. We established a reputation as a reliable vendor for our customers.

The business became a successful mainstay of our business, but only because we developed a planned business-development process that we reviewed constantly and made the market-required changes to.

About the Author

Jon M. Stout is the chairman of the board for Element H2O, a bottled-water company located in Chantilly, VA, that offers only Ultra Pure bottled-water products and private-label opportunities for small and large businesses in all 50 states and Canada.

Element H2O's clients include a wide array of businesses in the government contracting business, health and fitness industry, and hospitality industry, including martial arts studios, fitness centers, gyms, private trainers, physical therapy clinics, sports medicine clinics, large and small hotels, day spas, restaurant chains, catering companies, and many others.

You can reach Jon Stout at (866) 4-PURITY or by email at jon.stout@ElementH2O.com. Visit Element H2O's website at www.Elementh2o.com.
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