Water Bottling
Water Bottling
Business Model Description
Construct groundwater boreholes and install high volume electrical water pumps and set up facilities, including equipment, to collect and bottle water for supply to the local market, Southern African Development Community (SADC) region and abroad, including an integrated value-addition approach for water bottles and accessories.
Expected Impact
Contribute to public health and address water-borne illnesses, create jobs and facilitate effective catchment management of wetlands.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- Lesotho: Maseru District
- Lesotho: Leribe District
- Lesotho: Mafeteng Dstrict
- Lesotho: Berea District
- Lesotho: Butha-Buthe District
Sector Classification
Consumer Goods
Development need
Lesotho is a food-deficient country with over 70 percent food needs addressed through imports (22). A combination of recurrent droughts, land degradation, floods, inadequate food supply chains and lack of access to markets and finance for many smallholder farmers has resulted in steadily decreasing harvests (28).
Policy priority
National Strategic Development Plan (20218/19 - 2022/23) plan outlines the development of local food systems, agricultural value chains, and supplier development systems, to create opportunities for farmers, including for women, youth. (13).
Gender inequalities and marginalization issues
Prices of food remain high, coupled with unstable income opportunities and low purchasing power, especially among poorer households which are predominantly in the rural areas. Overall, food inflation was 7.8 percent in May 2022 compared to 6.9 percent in May 2021 (22).
Investment opportunities introduction
Lesotho has many natural springs which flow year round, providing a sustainable input for investment in agriculture and beverages for both production and consumption (3).
Key bottlenecks introduction
Lesotho has the challenge of environmental degradation which may have long-term negative impact for the wetlands and sustainability of the water sources (13).
Consumer Goods Retail
Development need
Lesotho has abundant water resources, but has only 28% of the population using a safely managed drinking water service (24).
Policy priority
Government intends to provide infrastructure that preserves water sources, the purity of Lesotho’s water and minimizes microbiological and chemical contamination, to improve access to safe water (3).
Gender inequalities and marginalization issues
Rural areas have only 5% of piped water compared to 26% in the urban areas, and about 74% of women are responsible for collection of water within households, and this is particularly prevalent in the rural areas (5).
Investment opportunities introduction
Lesotho has around 137 documented springs. Maximum yield of the springs is 8.5 litres of water per second, which is low in concentration of micro-organisms and chemical pollutants. There are also a total of 90 documented boreholes countrywide. (3, 17).
Key bottlenecks introduction
Lack of laboratory testing facilities in Lesotho forces water bottlers to take their samples to Bloemfontein in South Africa for testing (3).
Non-Alcoholic Beverages
Pipeline Opportunity
Water Bottling
Construct groundwater boreholes and install high volume electrical water pumps and set up facilities, including equipment, to collect and bottle water for supply to the local market, Southern African Development Community (SADC) region and abroad, including an integrated value-addition approach for water bottles and accessories.
Business Case
Market Size and Environment
< USD 50 million
> 24,000 * 500 ml / day to fulfil the demand for both the local and export markets
According to Lesotho Economic Roadmap (2018/19 - 2022/23), Lesotho already imports M69 million (USD 3.8 million) of bottled water from South Africa, and Phokeng plans to capture M58 million (USD 3.2 million) of that (3, 4)
The potential quantities of allocated ground water provide expansion of the plant and production capacity from the current 3,000 * 500ml/day to >24,000 * 500ml/day to meet both the local and export markets (3).
Indicative Return
5% - 10%
Bottled water is considered safe for drinking, which has boosted consumption and Phokeng Spring Water Bottling achieved an ROI of 5% - 10% (4).
Investment Timeframe
Short Term (0–5 years)
A shift from consumption of tap water to bottled water has improved the turnover of Phokeng Spring Water Bottling and boosted sales within 5 years of operations (4).
Ticket Size
< USD 500,000
Market Risks & Scale Obstacles
Capital - CapEx Intensive
Market - High Level of Competition
Market - Highly Regulated
Impact Case
Sustainable Development Need
In Lesotho, only 26% of households in the urban areas have access to piped water within the yard, while in rural areas only 5% have access to piped water. And it is lack of knowledge, infrastructure and technology, which are responsible for low access, with implications for women and girls (5, 6).
Gender & Marginalisation
Women and girls, low-income women, and women living in poverty and in the rural areas are significantly impacted by water insecurity and WASH-related diseases (7).
Expected Development Outcome
Bottled water can facilitate and improve technology for water harvesting and help create better access to water for populations across the country, considering the abundance of water resources in Lesotho (6).
Gender & Marginalisation
By providing safe and clean water through bottled water, women and girls can have access to a reliable and convenient source of drinking water. This can reduce the time and effort required to collect water, allowing them to focus on education, work, and other development activities (9).
Primary SDGs addressed
6.5.1 Degree of integrated water resources management
6.2.1 Proportion of population using (a) safely managed sanitation services and (b) a hand-washing facility with soap and water
In urban areas 26% of households have access to piped water sources within the yard, while in rural areas only 5% have access to pipe water (5).
Population using at least basic sanitation services 50.3% in 2020 (21).
By 2030, implement integrated water resources management at all levels (19).
By 2030, achieve access to adequate and equitable sanitation and hygiene for all (23).
Secondary SDGs addressed
Directly impacted stakeholders
People
Gender inequality and/or marginalization
Planet
Corporates
Public sector
Indirectly impacted stakeholders
People
Gender inequality and/or marginalization
Corporates
Public sector
Outcome Risks
If the cost of bottled water is not affordable, it has the potential for inequalities and access, particularly for households with low or no incomes.
Plastic water bottles can end up in the landfills and take years to decompose with implications for the environment (10).
Global market of bottled water grew by 73% from 2010 to 2020 with fears that disposal of water bottles threaten the environment through plastic pollution (12).
Impact Risks
Poor management of the water sources may dry up the water and undermine the impact of bottled water, particularly on women, girls and rural populations.
Impact Classification
What
Water bottling provide safe drinking water for communities and as a food product and nutrition component, it also contributes to public health and addresses water-borne illnesses.
Who
Consumers benefit from safe drinking water, and women and girls, in particular, are spared the burden of fetching water and focus on education, work and other development activities.
Risk
Unsustainable management of the water sources have negative impact, particularly for women, girls and rural populations, including exposure of plastic pollution from disposal of water bottles.
Contribution
Bottled water contributes to access of safe drinking water, alleviates the burden of water collection by women and girls, allowing them to focus on education and development activities.
How Much
Bottled water benefit the broader economy through its rippling effect on all economic sectors.
Impact Thesis
Contribute to public health and address water-borne illnesses, create jobs and facilitate effective catchment management of wetlands.
Enabling Environment
Policy Environment
National Programme for Integrated Catchment Management: Operational Plan 2022 promotes integrated, sustainable, and risk-informed development and management of water, land, and related resources for water preservation and sustainability that guarantees availability of water (1).
Gender and Development Policy (2018 – 2030) advocates for equitable participation and representation of women and men and other groups at all levels of water and sanitation management to promote equitable access, which facilitates fairness in business (5).
National Strategic Development Plan (2018/19 - 2022-23) commits to improvements in land and water management which it notes it is critical to infrastructure to reduce environmental degradation and increase productivity in the natural resource sector (13).
Lesotho Water and Sanitation Policy (LWSP) promotes proper management of water resources and its sustainable utilization, including adequate and sustainable supply of potable water and sanitation services to the population of Lesotho, critical for industry and livelihoods (14).
Financial Environment
Fiscal incentives: Water bottling is classified as manufacturing and is charged 10% company tax compared to the standard rate of 25% (17).
Regulatory Environment
Lesotho Electricity and Water Authority regulates electricity, urban water and sewerage services in the interests of all stakeholders and support their growing and ever-changing needs (15).
The Department of Rural Water Supply (DRWS) is responsible for developing water supply and sanitation infrastructure and service delivery in rural areas. This is done through community-managed water schemes and support for on-site sanitation (16).
Marketplace Participants
Private Sector
Maluti Pumps and Water Tanks, Leso Plastics, Phokeng Natural Spring Water Bottling, Dew Drop, HPL Consortium (Pty) Ltd.
Government
Lesotho Electricity and Water Authority (LEWA), Department of Rural Water Supply (DRWS), Department of Water Affairs (DWA), Lesotho Highlands Development Authority (LHDA), Water and Sewerage Company (WASCO), Lesotho Meteorological Services (LMS), Revenue Services Lesotho.
Multilaterals
World Bank, African Development Bank, World Health Organization, European Union.
Non-Profit
Lesotho Council of Non-Governmental Organizations.
Target Locations
Lesotho: Maseru District
Lesotho: Leribe District
Lesotho: Mafeteng Dstrict
Lesotho: Berea District
Lesotho: Butha-Buthe District
References
- (1) Re Noka, The National Programme for Integrated Catchment Management in Lesotho: Operational Plan, 2022
- (2) Mr. Léo Helle, Statement at the conclusion of the official visit to Lesotho by the Special Rapporteur on the human rights to safe drinking water and sanitation, February 2019. www.ohchr.org/sites/default/files/Documents/Issues/Water/EndofMissionLesotho.pdf
- (3) Government of Lesotho, Lesotho Economic Roadmap, 2018/19 – 2022/23
- (4) SDG Investor Map Phoking Natural Spring Wat Stakeholder Consultation, June 2023
- (5) Government of Lesotho, Gender and Development Policy, 2018 – 2030
- (6) Lindsay Boyce, Water in Crisis - Lesotho. thewaterproject.org/water-crisis/water-in-crisis-lesotho
- (7) Women and Water: A Women's Crisis. https://water.org/our-impact/water-crisis/womens-crisis/
- (8) National Geographic, How clean water supports women and girls, 2019. https://www.nationalgeographic.com/science/article/care-water-champion
- (9) UN Women, Gender Equality in The 2030 Agenda: Gender-Responsive Water and Sanitation Systems. https://www.unwomen.org/en/digital-library/publications/2018/6/issue-brief-gender-responsive-water-and-sanitation-systems#:~:text=The%20lack%20of%20safe%20sanitation,provide%20the%20much%2Dneeded%20care
- (10) Kor Water, How Reusable Water Bottles Help the Environment, 2019. https://www.korwater.com/blogs/the-well/how-reusable-water-bottles-help-the-environment#:~:text=Investing%20in%20a%20reusable%20water,water%20bottles%20help%20the%20environment.
- (11) International Bottled Water Association. bottledwater.org/economics
- (12) World Economic Forum, Future of the Environment, 2023. https://www.weforum.org/agenda/2023/03/climate-crisis-water-environment-floods-stories
- (13) Government of Lesotho, National Strategic Development Plan, 2018/19 - 2022/23
- (14) Government of Lesotho, Lesotho Water and Sanitation Policy 2007
- (15) Lesotho Electricity and Water Authoritty, Quality Of Service And Supply - Standards. https://www.lewa.org.ls/quality-of-service-and-supply-standards/#
- (16) Lesotho Electricity and Water Authority, Water And Sewerage Sector. https://www.lewa.org.ls/water-and-sewerage-sector/
- (17) Lesotho National Development Corporation. https://www.lndc.org.ls/content/investment-incentives-why-invest-lesotho
- (18) Government of Lesotho, Bureau of Statistics Business Register 2016
- (19) World Bank Group, ATLAS of Sustainable Development Goals 2023. https://datatopics.worldbank.org/sdgatlas/?intcid=ecr_hp_headerv_en_ext
- (20) Lesotho National Development Corporation. https://www.lndc.org.ls/content/water-bottling
- (21) United Nations, Sustainable Development Report, 2023
- (22) World Food Programme, Lesotho Annual Country Report, 2022. https://docs.wfp.org/api/documents/WFP-0000147970/download/
- (23) United Nations, Sustainable Development Goals, 2023. https://www.undp.org/sustainable-development-goals/clean-water-and-sanitation
- (24) United Nations, Sustainable Development Goals, 2023. https://www.sdg6data.org/en/country-or-area/lesotho
- (25) United Nations, Sustainable Development Goals, 2023. https://www.sdg6data.org/en/country-or-area/lesotho#anchor_6.3.2
- (26) SDG Investor Map Stakeholder Validation Workshop 2023
- (27) SDG Investor Map Dew Drop Stakeholder Consultations, October 2023
- (28) United Nations Lesotho, The Lesotho Food Systems Summit, 2021. https://lesotho.un.org/en/157722-lesotho-food-systems-summit
- (29) Organic and Natural Product Africa Portal. https://www.organicandnaturalportal.com/company/phokeng-natural-spring-water/#:~:text=Phokeng%20Natural%20Spring%20Water%20is,Likhoele%20Mountain%20in%20Mafeteng%2C%20Lesotho.
- (30) TapWater Pro, Can you drink the tap water in Leribe (Lesotho)?, 2023. https://tapwaterpro.com/leribe-lesotho/
- (31) Government of Lesotho, National Irrigation Master Plan and Investment Framework, 2020