New Wave

Two key factors in a water store's success are location and marketing. According to Bruce Wilkinson, co-founder of Water Business Interna-tional, an Escondido, California, manu-facturer of purification equipment, water stores can make a splash in almost any part of the country. "Warmer climates have greater demand because people drink more water there," Wilkinson says, "but we've seen stores opening just about everywhere."

The ideal site is in a strip center anchored by a supermarket--exactly the kind of site Bozin chose for his shop. "Being near the supermarket is a big advantage," says Bozin. "It's easy for people to stop in at the same time they do their weekly shopping," and that extra measure of convenience can spell the difference between a sale and a pass.

In this business, an upscale neighborhood won't necessarily translate into rising sales. On the contrary, says Joe Chaves, whose store is earning monthly sales of approximately $4,000, "I don't think this business does as well in high-income areas [because people there] don't care about saving 75 cents a gallon on water. We're in an area that caters to families; they're the ones who want to save money."

Interestingly enough, locating in an area with a significant immigrant population can be a plus. "People in other countries are used to drinking bottled water," says Donna Compton, owner of H2O2Go in Vista, California. "Many people from other cultures simply won't drink water from the tap."

Whatever the demographics, population density is an important consideration. "You want a high-visibility, high-density location," says Wilkinson. Areas with a preponderance of apartment buildings are especially desirable. Notes Wilkinson, "Renters aren't going to invest in their own home purification systems, and they're less likely to want to pay for home water delivery."

This article was originally published in the January 1997 print edition of Entrepreneur with the headline: New Wave.