Despite a drumbeat of pessimism, the $600 billion water industry boasts of a sizeable number of profitable large companies. What’s more, new entrants are bringing emerging technologies that will disrupt the industry and create new opportunities, according to Lux Research.
A review of 150 companies across the value chain – representing 23 per cent of the market – found average operating profit of 12.9 per cent, torpedoing claims that it’s impossible to make money in the water business. Customer-facing sectors in public service and small consumer systems do even better, clocking 14 per cent profits.
“To read recent headlines in the water industry, one might think the sector is impossible to navigate, but that couldn’t be further from the truth,” said Brent Giles, Lux Research Senior Analyst and the lead author of the report titled, “Making Money in the Water Industry.” “By targeting worthwhile market sectors and keeping in mind some key sector-specific principles, a company can build a successful business.”
Lux Research analysts also drew on a survey of over 150 start-up companies to map emerging technologies where new players can find ways to enter – and where established companies will find both opportunities and threats. Among their findings:
·Two areas dominate innovative company activity. A quarter of the start-ups focus on monitoring, forecast and control, an area that includes advanced sensors and process control. Nearly another quarter focuses on basic wastewater treatment. Other fast-moving areas include metals and organics recovery, and disinfection.
·Advanced sensors are a top technology within monitoring. Advanced sensors read key analytes sensitively, in real time, and use robust techniques suitable to opaque samples, allowing for uses like monitoring of municipal water systems to reduce leakage and non-revenue water. Companies likeANDalyze have received strong early-stage traction and startups in this space increasingly compete with larger companies like GE, Veolia, and IBM Smarter Water.
·Low-energy, low-sludge systems lead paradigm change in wastewater Water Intelligence service.
About Lux Research
Lux Research provides strategic advice and ongoing intelligence for emerging technologies. Leaders in business, finance and government rely on us to help them make informed strategic decisions. Through our unique research approach focused on primary research and our extensive global network, we deliver insight, connections and competitive advantage to our clients. Visit www.luxresearchinc.com for more information.
Contact: Carole Jacques, Lux Research, Inc.617-502-5314, carole.jacques@luxresearchinc.com
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