Home Office Bottled Water Sees Growth and Decline

It’s easy to forget that bottled water is not just what consumers buy in the store as a single serving beverage. The home office delivery (HOD) segment of bottled water is, surprisingly, a fast growing segment.

The number of water dispensers (typically 5-gallon) in the United States has been growing by around 4% a year and topped 8 million HOD for the first time in 2019. Most water dispensers are located in workplaces, representing two-thirds of all installations. Other key locations for HOD are healthcare environments, hotels, restaurants and catering, and domestic/home use. Of those 8 million, 6 million were typical HOD, however about 2 million were fitted dispensers that filter municipal water at their point of use.

This caused revenue in the HOD segment to fall back by 1% to $4.1 billion after years of steady growth. Point of use dispensers have grown from under 1.4 million to over 2.1 million during the past 5 years to account for 26% of that market. The 5 leading players including DS Services, Culligan, Sparklettes and Primo (DS Services purchased Primo in March 2020 for $775 million) own just under 60% of the HOD segment. With the announcement that Nestlé Waters North America intends to divest its water dispenser business, the HOD segment will see significant changes.

Also forcing changes on the HOD market is the coronavirus pandemic, which is forecast to have a major effect on the market, causing a substantial decline of 13-20% throughout 2020, and then followed by a slow recovery, returning to growth most likely in 2021. Pandemic or not, water is crucial to everyone’s health and the bottled water industry will withstand the global economic variations