By Carlos David Mogollón, WC&P Executive Editor
hen you get down to it, the past year has been probably one of the least eventful—in terms of controversy—for the point-of-use/point-of-entry (POU/POE) water treatment industry in some time. But don’t let that deceive you. The reason is because everyone has been so busy doing business.
The global economy rebounded nicely from the Asian flu of 1997 and rescue of the Russian economy in 1998. Latin America was a bit subdued in 1999, but hanging in there. And in the United States, the economy continued to outperform expectations as the books were closed on the 20th century.
Unemployment consistently broke records for the lowest ever and the stock market fluctuated but remained relatively constant, with a Dow Jones Industrials Average mostly in the 11,000 range or better (peaking at 11,497 on Dec. 31). Keep in mind it was only in 1995 that the Dow broke 5,000.
Optimism is high, in a sense almost as if it’s a return to the “feel good” post-war era of the ’50s and early ’60s. Thus, we arrive at the 26th Annual Water Quality Association Convention & Exhibition on March 21-26 in Long Beach, Calif., with an outlook primed for growth.
Water under the bridge
Ned Jones, 1999-2000 WQA president, said the biggest issues of the past year were:
- The major legislative victory in California with respect to restrictions on communities looking to ban drinking water treatment devices and the industry’s agreement to improve water softener efficiency,
- Updating materials safety determination methods for components in the ANSI/NSF standards and efforts for harmonization with WQA Gold Seal S-series standards,
- Progress toward a WQA-sponsored Water Quality Society to draw in small system operators, other water industry professionals and expand the association’s influence, and
- The 25th anniversary of the Safe Drinking Water Act (SDWA).
In fact, Jones, who’s also president of Gordon Brothers, Salem, Ohio, and WQA executive director Peter Censky were among those in attendance at the SDWA gala celebration in Washington, DC, in mid-December.
“There were 17 associations represented and they talked about all the contaminants and the latest statistics and rules status on each,” he said. “They talked about pharmaceutical contaminants where people flush old prescriptions down the toilet and how these are water soluble and become an environmental and health problem…
“But with all they’re doing to detect and categorize the risk of various contaminants, they still haven’t realized that we have the answer to their problem: POU/POE. We’re really only dealing with a small amount of water in the home that’s consumed. Municipalities do a great job of producing water for bathing, washing clothes and dishes and flushing the toilet. However, it makes no sense to provide very high quality water for these things. It’s just so simple to figure out, I don’t see how they couldn’t get it.”
Leave it to the home water treatment equipment or bottled water industry, Jones said, adding that this doesn’t mean these industries need to view water utilities as competitors. “We don’t look at them as adversaries; we look at them as providing the source water for us to make better,” he said.
Even regulators and municipal water utility representatives, such as the American Water Works Association, have begun to recognize the value of POU/POE equipment. Considering estimated infrastructure and delivery system improvement costs, it’s only economically feasible to treat water to a certain level before it becomes more cost-effective to provide in-home treatment devices, Jones said. Getting that point across to the public will be the challenge of the new millennium.
Speaking earlier of the Dow, giving the keynote address at the WQA Opening General Session will be Roger Dow, senior vice president and general sales manager for Marriott International. He’s obsessed with quality, customer satisfaction and team empowerment. At Marriott, he’s the hotelier’s lead customer advocate, working with a 2,400-person sales force for over 1,300 properties worldwide. During a 25-year-plus career with Marriott, Dow directed every aspect of sales and marketing and earned a reputation as one of the most creative and innovative people in the industry. His years of experience taught him that customer and associate retention are key factors to long-term success. As president of the Roger Dow Group, he’s published two books, Turned On—Eight Vital Insights to Energize Your People, Customers and Profits and The Trust Imperative: The Competitive Advantage of Trust-Based Business Relationships.
There’ll be many events to keep trade show attendees occupied both in and outside the convention center:
Friday Tour: The Getty Center—This complex consists of five two-story pavilions housing a premier collection of paintings, manuscripts, sculpture, decorative arts and photographs from Europe and North America.
Saturday Tour: Hollywood Highlights—This event will include Mann’s Chinese Theatre, the Hollywood Bowl and the world-famous Farmer’s Market.
Saturday Evening Event: Long Beach Aquarium of the Pacific—While you’ll be enjoying the more than 10,000 ocean animals that inhabit this artificial aquatic environment, keep in mind that water quality is an important part of ensuring their well-being. The aquarium includes a state-of-the-art laboratory dedicated to testing the water in 47 display exhibits (the largest of which is 350,000 gallons), and numerous behind-the-scenes tanks where animals are also held.
Other Options: These include the Earl Burns Miller Japanese Garden at California State University, Long Beach, romantic gondola rides through the meandering canals of Naples Island to historic tours of the legendary Queen Mary oceanliner. Museums include the Museum of Latin American Art, the Long Beach Museum of Art and the Banning Residence Museum, a 23-room mansion built in 1864 by Gen. Phineas Banning and listed as a national historic site. In addition to harbor and whalewatching cruises available, there are three tallships in the area—the Pilgrim of Newport, and in Long Beach, the American Pride the Californian, associated with the Nautical Heritage Society. Free tours include the lush gardens at Rancho Los Alamitos and Rancho Los Cerritos, an 1844 two-story adobe complex furnished to reflect domestic lifestyles of the 1870s.
A Look at Long Beach and Beyond
Having finished the century celebrating 25 years of the Water Quality Association and the Safe Drinking Water Act, there are a lot of predictions floating about for the POU/POE water treatment
technology industry in 2000.
Let’s start with the association’s convention in Long Beach, March 21-26.
WQA executive director Peter Censky points to several issues as hot buttons for the convention and the year, stressing that his list is in no particular order of importance:
- Employing different means to increase trade show attendance,
- Initiating an online year-round trade show for convention exhibitors,
- Presenting blockbuster seminars including speakers such as the Centers for Disease Control’s Dr. Deborah Levy, University of Arizona microbiologist Dr. Charles Gerba and other prominent scientists and government officials on water issues,
- Unveiling WQA’s new strategic plan,
- Launching the charter membership phase of the Water Quality Society,
- Dealing with restrictive issues such as California’s Prop. 65, plumbing codes and septic system limitations.
“No. 1, we’re really trying to focus our marketing to bring in more people who are last-minute deciders… by marketing to them information on lower cost hotel/motel options in the area,” Censky said. “And we’re also charging on a per event basis so people can more affordably see what they want to see, whether it’s a technical session or the trade show floor.”
This effort is driven by a drop in attendance at the convention last year in Fort Worth, Texas, to just over 3,500 from 4,062 in Fort Lauderdale, Fla.
“I really feel good about this show,” said Pat Dalee, incoming association president for 2000-2001 and CEO of International Water Warehouse Inc. in Santa Barbara, Calif. “WQA has kind of looked at past ways we’ve presented the convention; and we’re opening it up more to people who want to do it a little more reasonably… rather than stay at just the expensive (hotels).”
Dalee also felt the Long Beach area was more convention friendly than other cities the event had been held at in recent years. That’s because it’s a larger metropolitan area that’s easier to drive to for the many WQA members in California and Pacific WQA members, as well as the fact that airfare into Los Angeles—a major airline hub—is cheaper for those who have to fly.
A few prickly issues
Still, not everybody was happy with the choice of Long Beach. A few expressed concerns about the convention center being a “union shop,” meaning booth setup for larger displays would have to be done by union labor. And Saturday breakdown expenses would cost double because of overtime, said one company president. Another, who asked not to be named, said that meant at least a $10,000 expense to his company.
Censky said although Long Beach is a union city, it’s a little more reasonable than others. “If you’re a manager under 45 years of age, you’ve never had to deal with unions,” he added. “But the reality is unions are becoming a little more prominent today, whether you like it or not. And members are going to have to understand that.”
Some manufacturers also were upset about the choice of California because of pressure on the industry over the past few years from class action lawyers using the state’s Proposition 65—a highly restrictive citizen initiative passed in 1986 that puts extreme (many say unrealistic) limits on contaminants in drinking water—to squeeze multiple settlements out of manufacturers and suppliers over the issue of lead-bearing brass faucets.
Censky said an educational session is planned on Prop. 65 and WQA is investigating options, which include working with other affected industries. To that end, the association has been asked to join the Proposition 65 Fairness Coalition, a Washington, D.C., effort to change more extreme aspects of resulting California standards that deviate from federal ones enforced by the Consumer Product Safety Commission.
“The thing we’re doing is trying to work with the Congressional Small Business Committee, which has held at least one hearing on the topic,” he added. “The problem you have in California is the legislature cannot change that proposition, which has the force of law. Legislators are afraid to snub voters. It’s written as a thinly veiled extortion game for lawyers, who can sue on behalf of the state to enforce it; but to override something like that you have to have national action.”
The level at which the association pursues the issue will depend on affected members, industry alliances and the probability of effecting change.
Osmonics CEO Dean Spatz said: “You know, California is some 25 million-plus people now, like a country of its own. I don’t think you can necessarily say I’m not going to do business there because they’ve elected some politicians and passed some laws that make life a little difficult.
“On the other hand, some things they’re doing with respect to water, efficiencies and recycling are pretty good… For water softeners, maybe it makes some of our valves unacceptable; but we’re also in the RO side and, from a business standpoint, that proposition isn’t necessarily bad for us.”
As for millennial predictions, Dalee said two issues he sees at the focal point of change are deflation and the Internet.
“We’ve been experiencing price erosion in all sorts of components, membranes, storage tanks, faucets, housings, filters,” he said. “Everything across the board is becoming less expensive with standardization and bigger volumes. And what we’ll see in the new millennium is foreign competition. You’ll see that represented in a big way in Long Beach. It’s happened in every other industry and it’ll come to the forefront with us now.”
The Internet, Dalee added, will allow manufacturers to control the price of their products like never before. This will put downward pressure on prices, but could allow smaller manufacturers to be more competitive.
Alamo Water Refiners CEO Sonny Cammack agreed: “The big guys are always going to get their bite, but the little guys are going to earn a good living too.”
Spatz said he felt all the excitement about e-commerce had drawn capital away from traditional businesses and as that enthusiasm dampens in favor of real profits, other businesses will find better access to funding for R&D and expansion.
This year, he expects his company to better mesh different acquisitions such as Seattle’s Zyzatech, New Jersey’s Membrex Inc. and Boston’s Micron Separations Inc. into the larger framework of Osmonics such that “we come fully into the new millennium as one company instead of a group of 10” with faster delivery and higher profits.
Cammack also anticipates business being good in 2000, particularly since he recently took the reins as general manager once again at Alamo.
“I know mine will increase, but I think it will for the industry in general,” Cammack said. “USFilter and Culligan, which are now owned by the French as of a year ago, bought a lot of companies. And of those people they employed, a lot of them are no longer with them because of consolidation. They’ll get back into the business working for themselves or in other capacities. Once you’re in the water business, you tend to stay in it.”