Traders start treading as more people enter water business

Purified water is becoming popular among Yangon’s well-to-do, but with more people entering the business, margins are being squeezed for the middlemen who deliver it door-to-door.

Municipal water supply generally comes from four reservoirs located far north of town – no longer including Kandawgyi and Inya lakes – or tube wells, but people like Ko Phoe Zaw, a resident of Yangon’s outskirts, said he reckons it is healthier to buy bottled water from the delivery people, particularly for drinking.

There are several different ways the business can work. Most pay a one-time deposit of about K12,000 to the factories before obtaining the 20-litre bottles at a cost of about K230 a bottle. They then sell it at a mark-up, usually a final cost of K300 to K500 a bottle.

Some small-scale sellers directly earn the mark-up, while others work for a large-scale broker at a set salary.

“My beat is South Okkalapa township’s 14th ward,” said Ko Myint Mo, a deliverer of 555-brand bottled drinking water. “I have a strong set of customers in the area, and work for my boss with a salary, not on a percentage.

“I make enough for my accommodation and food, and also to help out my family. The work is a little tiring, but not too bad overall,” he said.

A 2014 Yangon City Development Commission presentation on Yangon’s water supply said about 205 million gallons of day are pumped in daily from the city’s four main reservoirs to the north of the city.

Given concerns about water quality, many entrepreneurs aim to enter the business. Still, it can be tough to get started.

Ko Myat Kyaw said he has had difficulty finding customers. Most houses already have a delivery person and do not want to order a new brand: They want to stick with the one they trust.

“I started just delivering to my friends and relatives’ homes. I’ve been working for six months, and only now are people starting to believe my brand’s quality and order from me,” he said. “I deliver in time, which is one way to get people to order from me.”

He added it is also difficult to prove that a particular brand of water is properly treated and is safe, so people stick with the brands they know.

Ko Tain Lwar Htun delivers Myawaddy-brand bottles in Mingalardon township’s Pearl New City area. He earns a commission from his boss, not a salary, so his income depends on his ability to drum up more business.

Ko Myint Mo said working in the summer is best, as it is easy to deliver water and lots of people are thirsty. Business noticeably drops off in the rainy and cold seasons.

Downtown is also the best place to work, given the proximity, though all the stair-climbing is hard work. Ko Myint Mo said many delivery people charge higher rates the further up the building they have to go.

“The best situation is getting an office or a factory as a customer,” he said. “Then the business is good, and it’s comfortable to find money, because they order many bottles in one day.”

Source: Myanmar Times

NB: The best way to find information on this website is to key in your search terms into the Search Box in the top right corner of this web page. E.g. of search terms would be “property research report”, ”condominium law”, "Dagon City", “MOGE”, “yangon stock exchange”,"MECTEL", "hydropower", etc.

To learn about the business opportunities in Myanmar click here

To evaluate the various segments of the market that you could possibly enter base on your competencies you can do a Custom Market Entry Strategy Research. You can see a sample report at page "Actual Sample of Client Report”. Click here to go to page.

Do you know that IE Singapore is giving up to SGD 20,000 support for Singapore company to venture into Myanmar? To learn more click here