By Matthias Kubr, Environmental Health & Safety Research Analyst
U.S., Frost & Sullivan
March 30, 2001—The U.S. market for commercial water treatment brings unique challenges to market participants, according to a new study from Frost & Sullivan.
A maturing market in combination with high saturation levels among commercial end-users requires manufacturers to find alternative ways to stay competitive and grow. Indeed, commercial water treatment is a true and tried part of many commercial end-users ranging from hotels and restaurants to carwashes and laundries.
This is especially true for those end-users that live in areas with known water issues, e.g. hard water from groundwater wells in the Midwest.
Some commercial end-users, such as institutions like hospitals and prisons, have been using some form of water treatment, such as water softeners, for multiple decades. As a result, most of the potential market has been realized and the majority of the growth in these end-user groups comes from new construction.
However, other commercial end-user groups have only within the last decade begun to take advantage of on-site water treatment. Some of the reasons for the increase in use of these newer systems include lower equipment costs, better performing systems, and easier and more affordable operations of the units. This was especially the case with newer technologies such as reverse osmosis or ultraviolet. As it became apparent that certain commercial end-user groups could benefit greatly from the use of on-site water treatment they readily accepted and embraced the technology.
An excellent example is the car wash. In the past, sheeting chemicals were added in the final rinse cycle to ensure a spot free finish on the car. As these chemicals were used for a long time, they have become the standard treatment method and few carwash operators were looking for alternatives to them. However, in the late 1980s to early 1990s, some entrepreneurial carwash operators realized the potential savings that could be achieved with the alternative water treatment.
Water treated with a reverse osmosis system enabled operators to eliminate the use of these expensive sheeting chemicals, therefore reducing long term operating costs while at the same time providing better quality service. As their successes became known across the carwash industry, others joined in and started to use RO in their carwashes as well. This resulted in a very rapid adoption across this end-user group, as these businesses where able to realize savings almost immediately.
In addition to the maturing market and the high saturation level among end-users, manufacturers have to consider another factor as well: The commercial water treatment market is very fragmented. While there are a number of large national companies, the bulk of companies operating in this market are smaller, and are active only on a regional or even local scale. It is therefore difficult for many manufacturers to built brandname awareness, which is very important in a maturing market such as this one.
A recent study by Frost & Sullivan looks closer at these and other issues and analyzes the various aspects of the commercial water treatment market. According to the study, the commercial water treatment market in the U.S. has reached estimated revenues of $550 million in 2000. The market, which includes water softeners, sediment filters, chemical feeders, reverse osmosis, ultraviolet, and ozone treatment, grew at around five percent that year.
For more information visit www.water.frost.com, or contact Kimberly Howard at 210.247.2488.
