Start a water refilling business by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your water refilling business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a water refilling business?
Here are the basic things you will need to pay for:
-Initial water refilling machine
-Legal documents and business permit
-Supplies (bottles, stickers, etc.)
What are the ongoing expenses for a water refilling business?
Ongoing expenses include rent and utility costs. You’ll also need to source your water. In general, incremental costs can be as little as $0.02 per small water bottle refill. Expect to pay employees per hour, at about $10 per hour.
Who is the target market?
While residential homes provide great clients, you’re better off targeting commercial entities. Make sure you’re selling to larger businesses, as they’re most likely to buy refilled water bottles in bulk. Plus, they can redistribute them for your business—requiring less overall money to distribute your products.
How does a water refilling business make money?
A water refilling business makes money by collecting, testing and redistributing water. Normally, the water is sold in bottles. It can, however, be sold to larger companies for mass distribution. Some water refilling companies sell water filling stations for the home.
How much can you charge customers?
Refilled water bottles vary in price. Most can be purchased for as little as $1. Larger, five-gallon water bottles can be charged at about $15. If you’re selling mounted water refilling stations, consider pricing them at about $500 to be competitive.
How much profit can a water refilling business make?
A successful water refilling business can net its owner as much as $40,000 per month. As the business expands, however, money will need to be managed effectively to ensure proper scaling.
How can you make your business more profitable?
Connect with local businesses quickly, and take a disciplined approach to account management and promotions. If you can, make sure your employees are knowledgeable about social network marketing to reduce overall costs. Competition between brands can be difficult for start-up businesses, so it pays off to invest time and effort. Offer something competitors can’t give, and establish a solid value proposition.
What will you name your business?
Choosing the right name is very important. Read our detailed guide on how to name your business. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your water refilling business is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
Form Your LLC
Read our Guide to Form Your Own LLC
Check out the Top Business Formation Services from our friends at StartupSavant.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Find the right bank for you, read our review of the Top 5 Banks for Your Small Business
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
Certain state permits and licenses may be needed to operate a water refilling business. Learn more about licensing requirements in your state by visiting SBA's reference to state licenses and permits.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Water refilling businesses should consider requiring clients to sign a service agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example service agreement.
Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your water refilling business when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.
Certificate of Occupancy
Certificate of Occupancy
Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a water refilling location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a water refilling business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a water refilling location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your water refilling business will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a water refilling business
Water refilling businesses don’t normally promote and market their services directly to individuals. They typically target corporate and commercial accounts who need between 50 and 100 water containers per day. To market effectively, a water refilling business should focus on competing with established brands.
Run promotions on different social media websites like Facebook and Twitter. Having a YouTube channel can help, too, as you can provide the public with information about the cleaning and refilling process. Water refilling businesses tend to have more success by being transparent.
How to keep customers coming back
To attract customers, make sure your refilling business’s cleaning and refilling process is incredibly viable, safe and competitive. Make sure your daily produced water batch reaches consumers quickly. Use effective customer outreach, too. Often, customers need help with water dispensers. Because the water refilling business requires low contamination, any misunderstandings on the consumer’s end can result in lost sales.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Water Refilling Business In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
The water refilling business is great for environmentally-minded individuals. It’s also great for those who have worked in the wastewater industry, handling water to provide clean, drinkable resources.
A good water refilling business owner will be good at making business plans. Additionally, they will be effective at finding suppliers, balancing budgets, and finding cheap equipment. They must also know how to conduct an analysis of the water, in order to determine how sanitary the sourced water is.
What happens during a typical day at a water refilling business?
Every day, a water refill business sources water for cleaning. Machines are installed, repaired and maintained. These machines can process water for redistribution. Water must be sampled to ensure that the treatment process went well. If the sampling results don’t meet standards, the business needs to check its machinery. Water refilling machines eventually distribute the water into different containers. These containers are loaded onto delivery vehicles which carry the water to different outlets.
Other daily responsibilities include marketing, management and financing. Unlike other businesses where marketing promotion alone can gather consumers, water refilling businesses require a little more perseverance.
What are some skills and experiences that will help you build a successful water refilling business?
To become a successful water refilling business owner, you’ll need to have a solid handle on water analysis. Additionally, you’ll need to know how to implement marketing tactics while supporting environmental causes.
From a competitive standpoint, you’ll need to run promotions often and have a disciplined approach to business operations.
What is the growth potential for a water refilling business?
The water refilling industry is growing rapidly. It’s become a profitable business for entrepreneurs, and a lot of consumers are choosing refilled water because they’re turning away from tap water. Assuming quality control is upheld, a water refilling business can make quite a lot of money—even becoming a national distributor.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a water refilling business?
Water refilling businesses are usually needed, and they’re likely to succeed if its area has no access to clean pipe water. For this reason, they’re incredibly profitable in places like the Philippines. Because a water refilling business promotes sustainability while protecting the environment, it has a higher chance of success if an area requires additional efforts.
Make sure you promote quality control and safety measure when jump-starting your business. Also, check with your local health department before getting involved. There’s a good chance your business needs to abide by several standards which you might not have thought about.
How and when to build a team
A team of two to five should be built as soon as possible. You’ll need maintenance operators to handle the machinery. Similarly, you’ll need to distribute efforts across marketing and management spheres. The water refilling business can get complex, and plenty of water needs to be analyzed and redistributed.