Industry Forecast: Exciting Times Ahead

Jan. 8, 2016
2016 promises to be a year of new technologies & opportunities

Smartening Up the Industry

As I began to reflect on ideas for my 2016 Industry Forecast, I came to the realization that 2016 will be my 30th year in this industry. Yes, I am only 39! I have been blessed in that I have had the privilege to work with many of the “founding fathers” who shaped our industry, and have been given the opportunity to work with and hopefully mentor future leaders as well. 

As I look back, I am in awe of how our industry has changed and grown. As a scientist, it is especially gratifying to see the impact of technology on the many options for water treatment. Point-of-use (POU) systems have transitioned from granular activated carbon filters that typically only made improved taste claims to carbon blocks and modern fabric technologies that make significant health claims. 

Reverse osmosis (RO) systems have gained popularity and become significantly less expensive. The RO membranes commonly used today are better than those of 30 years ago. Do you remember cellulose acetate membranes? For those of you who do not, cellulose acetate membranes required chlorinated water, as they were prone to microbial attack. They also were not as efficient as today’s thin film composite membranes. 

Point-of-entry (POE) system controls have gone from manual to time clock to sophisticated electronics—from “dumb-dumb” to “smart” controls that regenerate only when necessary. This has resulted in significantly improved salt and water efficiencies. 

NSF standards for this industry were fairly new when I started, and they were North America-centric. Today these standards, like our industry, are global.

Although I do not have a crystal ball, I imagine that our industry will fully embrace the “Internet of Things.” Performance monitoring of water improvement systems that transmit information to mobile apps will become commonplace. Water treatment systems will be smaller and more efficient in removing contaminants, as well as saving water. Saving, making and reusing water are the future for our industry.  

Lastly, I strongly believe that our industry, as it grows globally, has a moral obligation to provide pure, clean and microbiologically safe water at low cost or no cost to those in dire need. We are all interested in growing our businesses financially, but we also must remember that we are all here to serve each other, too. Water quantity and quality will be the most important resource we need to manage as we move into the next 30 years.

By Frank Brigano, Ph.D.
Vice President, Research & Development
KX Technologies
[email protected]

Never a Dull Moment

Looking forward into 2016, I see three main trends that I believe will influence the POU/POE market. 

The Quest for Differentiation. Commoditization has become a concern for many in the industry. The residential market is served by many product lines of softeners, RO systems, filters, ultraviolet systems, etc. Increasingly, there has been a trend of “fits in”-type replacement filters entering the market, especially for refrigerator filters. In this environment, manufacturers are seeking to differentiate their products to avoid competition strictly on price. The issues in the restaurant/commercial food service sector are similar, with the same fits-in product proliferation as in the residential refrigerator filter market. Manufacturers that can differentiate their products from others will benefit greatly in this environment.

Continued Growth in China. The growth of the residential water treatment market in China has been phenomenal over the past several years, with reports of 40% to 60% year-over-year growth in unit sales, and increasing average sales prices. Although there are signs of the Chinese economy slowing, the issues and concerns regarding drinking water quality in China continue, and growth in the POU/POE market also will continue to be high. There is even a niche for imported products there because of the willingness to pay and the perceived high quality, assuming that the imported products can clear the regulatory barriers to enter the market.

Focus on Trade Barriers. There are some grassroots efforts to try to reduce trade barriers. Although this battle has been waged on some level for two to three decades in Europe, there is a renewed focus and energy, especially among manufacturers, to try to reduce these barriers. There could be some tangible change coming in the foreseeable future if momentum can be maintained and even increased by bringing more manufacturers from the general water sector into the movement.

All in all, I believe that 2016 will certainly see continuation of one key trend in the POU/POE industry: There will not be any dull moments. It doesn’t take a crystal ball to predict that future for our industry. 

By Rick Andrew
Director of Global Business Development – Water Systems
NSF Intl.
[email protected]

Honesty, Integrity & Ethics

When I got started in the water treatment industry in 1994, change came at a snail’s pace. It seemed as though the slightest change would cause a huge ripple effect through the industry. Now change comes with such rapidity that it seems a bit odd if you open WQP magazine and do not see a new technology every month.

In reflection, the one thing that has not changed in all these years is doing things ethically. Unfortunately, it is still a disturbing reality that there are too many water treatment companies with no moral compass.

Gone should be the days of high-pressure sales, huge suitcases full of borderline-meaningless “tests,” people buying equipment just to get you to finally leave, and threats and scare tactics—yet they continue. I believe it is better to simply test the water and give people an honest opinion on how to correct any problems.

I have trained many installers and service technicians during my career, and no matter what the company or type of system, ethics were the recurring theme. That is true for 20 years ago, today, and, I assure you, the future. I have always said, “Conduct yourself as if there is a hidden camera on you, and you will never go wrong,” because you never know—there might be! It goes back to the Golden Rule: Treat people as you want to be treated. It sounds simple, but there are still people who care more about taking customers’ money than improving their way of life.

It has happened before—I have talked myself right out of a deal, telling the customer that I do not recommend any water conditioning because his or her water was acceptable as is. As we all know, almost all water can benefit from some sort of treatment, but at times I have felt that the customer was likely to struggle financially if he or she purchased a system, or, on rare occasions, that the water quality was already pretty darn good. Was it bad business? Perhaps. My wallet was screaming at me, but I know that it has come back to me tenfold. People can tell when they are being bullied, and they appreciate honesty, integrity and ethics.

There have been many articles written about the relationship between our industry and social media. Companies using poor business practices dread it and see it as a business killer. Companies doing things properly, however, see it as a boon. It just depends on your ethics.

Most of us would agree that the future of the water treatment industry looks bright, but as you look toward the coming year, and all of the years that follow, try to remember what got you here in the first place: the desire to help people with their water. 

By Scott Hillman, CWS
Integrity Plumbing and Water Treatment LLC
[email protected]

The Value of Training & Professional Certification

Professional development and employee training have become important topics in the business world. According to the Wall Street Journal, “Investing in training is critical for the survival of firms—not just in immediate skills, but in the deep knowledge that drives problem-solving and creative thinking.” Nevertheless, despite the need for greater investment in professional development, U.S. companies have been cutting money from employee training programs for decades. 

Contrary to that trend, the Water Quality Assn. (WQA) plans to focus its efforts in 2016 on the critical aspects of employee training to support continued growth of the credibility and professionalism of the water treatment industry. WQA has made its Modular Education Program (MEP) available to help with the training of all types of employees within POU/POE water treatment businesses. 

WQA also is using the MEP to help ease the burden of laws and regulations related to professional specialty licensing rules in certain states. On April 1, 2016, Colorado will introduce the option for water treatment professionals to become licensed as registered water conditioning contractors, principals or installers. If a water treatment professional passes the necessary courses to receive WQA’s designations as a certified installer and certified water specialist, that person also will become a professional licensed water conditioning principal in Colorado. This new option produces highly trained water treatment installers at a fraction of the cost of licensed plumbers. 

Colorado is the first state to cite the WQA MEP as part of its law and licensing rules. However, other states, including Rhode Island, Wisconsin and Idaho, are following in Colorado’s footsteps. 

On the federal level, WQA has hired Gephardt Government Affairs to help increase the water treatment industry’s influence in Washington, D.C. WQA plans to take a more proactive approach toward federal government relations in 2016. In partnership with former House Democratic Leader Dick Gephardt, WQA will closely monitor and address the opportunities and threats to POU/POE water treatment that may arise on Capitol Hill.

By Pauli Undesser, MWS
Deputy Executive Director
Water Quality Assn.
[email protected]

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