APPENDIX 9
Memorandum from the Deeside Water Company
Limited
I am writing in response to your request for
a memorandum outlining our thoughts and concerns about the bottled
water industry.
The industry is governed by the appropriate
UK and EU legislation regarding standards and processes, which
were reviewed and revised fairly recently. It is reasonable to
assume these will not change again in the near future. On the
basis that the core regulations remain the same, there are three
main points we wish to note.
The first is that our company is a relatively
small family run business employing ten people. We believe it
is important that the interests of smaller operators (and their
financial limitations) are considered in any decisions made. The
implications of certain requirements or changes can make the difference
between a viable company and one that is not. A common sense approach
should be maintained with a view to protecting the smaller operator
who has limited financial resources.
The second point is that bottled water is an
extremely competitive business and pressures exist from foreign
companies who sell in the UK. It is essential that Scottish producers
are not disadvantaged in any way that may increase red tape or
costs when compared to foreign competition. There is very little
profit margin in a bottle of water and increases in costs can
make some operations non viable. Any additional taxation or changes
to labelling requirements would led to costs that some companies
could not bear, which in turn would lead to closure and the loss
of jobs, which is particularly important in rural areas where
many water producers are based.
Finally, it is worth noting that our distribution
costs have risen dramatically in the last year due to high fuel
prices, making our product either more expensive and therefore
less competitive, or leading to a lower profitability for our
company, which prevents growth, expansion and investment. These
additional costs are very significant.
These are very general points of particular
interest to our own company. I hope they may be relevant to the
debate.
The Deeside Water Company Limited
October 2000
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