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Winston Salem, N.C.-Based Bottled Water Firm Expects Growth

Posted on: Tuesday, 4 October 2005, 18:00 CDT

By Brian Louis, Winston-Salem Journal, N.C.

Oct. 5--Newly formed Primo Water Corp. of Winston-Salem said yesterday that it expects the number of retail stores that carry its bottled water to accelerate over the next few months.

"Things are going very well for us right now," said Brent Boydston, the company's vice president of business development. "We're pleased with our progress."

Primo Water is available in three-and five-gallon bottles. The bottles are used with home and office water coolers. Consumers exchange their empty Primo Water bottles for full ones at Primo Water displays at retail stores. Primo Water reuses or recycles the empty bottles it collects.

For exchanges, the suggested retail price is $5.99 for a three-gallon bottle and $6.99 for a five-gallon bottle.

Primo Water was introduced in May. The privately held company was started by Billy Prim, who also founded Blue Rhino Corp., a propane-tank exchange company. Blue Rhino went public in 1998 and it was bought by Ferrellgas Partners LP in April 2004 for $343 million.

Primo Water said its retail-exchange program is easier and more convenient for consumers compared with having bulk bottled water delivered. Bulk water is defined as larger than 2.5 gallons.

This summer Lowes Foods began selling Primo Water at its Robinhood Road store in Winston-Salem and at all of its Raleigh and Charlotte stores. By the end of the month it expects 52 of its 110 stores to carry the product, including all of its Winston-Salem and Greensboro stores, said Dianne Blancato, a Lowes Foods spokeswoman.

"It's a local product that we think a lot of our customers would be interested in," Blancato said.

Primo Water is sold at 105 Kroger Co. supermarkets in Kroger's Great Lakes division, said Monica Gordon, a Kroger spokeswoman. Kroger's Great Lakes division has 245 stores in Ohio, Michigan and West Virginia.

She said that the initial response to Primo Water has been positive.

Boydston said that retailers who have tested Primo Water at their stores have all agreed to increased distribution in their chains.

Boydston also said that the company was in final negotiations with major retailers to carry the product. He declined to identify those retailers.

The competitive bottled-water industry has experienced strong growth in recent years.

In North America, the bottled-water industry generated about $13 billion in revenue last year, according to Jennifer O'Grady of Frost & Sullivan, a consulting company based in Palo Alto, Calif. The largest portion of that total -- $9.3 billion -- was derived from sales of single-serve bottles, according to O'Grady.

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Copyright (c) 2005, Winston-Salem Journal, N.C.

Distributed by Knight Ridder/Tribune Business News.

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RINO, KR,

Source: Winston-Salem Journal

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