1. Competitive landscape in the market of home water purification equipment
Since its early development in the 1990s, the Taiwanese market for home water purifiers has an operational history of about 30 years. Currently, there are seven major product categories in the market:
- RO (reverse osmosis) water purifiers
- Functional water machines
- Cold/warm/hot water dispensers
- Water filter jugs
- Shower filters
- Water boilers/dispenser units
- Filters, filter materials, metal and non-metal components
1) RO (Reverse Osmosis) Water Purifiers
This is the largest category in Taiwan, with a total of 34 players in the market. Unsurprisingly, price competition is the most intense in this segment. When RO water purifiers were first introduced in Taiwan, they gained significant popularity due to the improved taste and quality of the water. Even cold/warm/hot water dispensers were required to integrate RO water purifiers. In an effort to capture market share, manufacturers of functional water products made unfounded criticisms of RO systems. For instance, they claimed that drinking water purified by RO would lead to calcium deficiency.
The leading RO water purifier companies in Taiwan include ALYA (Easywell Water Systems Inc.), Fluxtek, Kemflo, and CCK Reverse Osmosis.
2) Functional Water Machines
Electrolysed water, hydrogen water, and hydrogen-rich water filtered with porous silicon are all forms of functional water, meaning pure water with additional properties. The key suppliers in Taiwan include Dianapure, AUO, and Buder.
Functional water is gradually gaining traction in the market, with a growing number of participants. In 2011, they even established the “Functional Water Association of Taiwan” in Taichung.
3) Cold/Warm/Hot Water Dispensers
The main issue with cold/warm/hot water dispensers is their high electricity consumption and bulky size. Water in these dispensers is repeatedly cooled and then boiled. While they are not commonly used in households, they are frequently found in offices, factories, or commercial premises. These machines retain a foothold in the market due to their ability to dispense both cold and hot water from a single unit. The leading suppliers in Taiwan include Hao Hsing, Hao Yu, Aqua Giant, Greatness, ACUO, and LCW.
4) Water Filter Jugs
This is a significant market, with the marketing-savvy German brand B being the first to enter it. That being said, there remain considerable opportunities within the promotional segment in Taiwan, where orders typically range from 6,000 to 10,000 units. The key players in Taiwan are ALYA (Easywell Water Systems Inc.) and Casing Micro Technology.
5) Shower Filters
This is a relatively new product designed to filter shower water. Consumers in the U.S. and Europe have begun to recognise the health benefits of filtered showers.
ALYA (Easywell Water Systems Inc.) is the most professional and prominent Taiwanese company in this sector.
6) Water Boilers/Dispenser
This was the first water appliance to take the Taiwan market by storm. The earliest versions served only to heat or cool water, with occasional additions of filters. Due to intense price competition, not many suppliers include filtering functions in today’s water boilers or dispensers.
The government has placed water boilers/dispensers under the category of non-competitive home appliances, providing subsidies. It is now also compulsory for suppliers to apply for energy efficiency labels and MIT (Made in Taiwan) certification.
2. Home water purifiers increasingly becoming a household appliance
Indeed, water purifiers are increasingly being regarded as household appliances. In the past, water purification equipment was designed for places with access to water sources and drainage facilities. However, suppliers have introduced RO water purifiers resembling water dispensers, which can be installed anywhere with an electricity socket. The purified water is dispensed just like water from a tap.
3. Companies with brands, facilities, and distribution channels
In Taiwan, approximately 72 companies in the home water purifier industry have manufacturing and assembly facilities. As many as 79.6% of these suppliers still operate as outsourced manufacturers for other brands. The Taiwan Drinking Water Equipment Association’s member list clearly distinguishes A-type members (manufacturers) from B-type members (non-manufacturers), with the annual membership fee for A-type members being twice as high as that for B-type members.
In reality, the manufacturing process for home water purifiers is not complex. Many companies in Taiwan are fully integrated, overseeing activities from manufacturing to sales, and are active across the entire value chain with established brand names. These companies possess their own:
- Brands
- Factories
- Distribution Channels.
The Taiwanese companies that have all three of these elements include: Sakura, CHARM, Fairy Water Industrial, Chanson, ACUO, ALYA, Seven Star Ocean, Great Idea, Blue Mountain Water, Lepa Water, Yen Sun, Buder, Dianapure, LCW, and BWT.
4. Trends for Water Purification Equipment in Taiwan
- Intelligence
- Compactness
- Material Science
- Energy Efficiency
1. Intelligence
Thanks to advancements in information technology, water purifiers are becoming smarter. The most common integration of electronic components into water purifiers is as follows:
1.1 Reminder for filter replacement
1.2 Reminder for membrane replacement due to excessive solid content in the water
1.3 Automatic suspension of water dispensing due to leakage
1.4 Timers
1.5 Press-on or one-touch water dispensing
Below are some ideas that have not yet been seen in the market. They serve as food for thought:
- Hydropower Generation
Water can be used to generate electricity for operating electronic components, thus saving the use of batteries. - Voice Control
Voice control could be used to operate water purifiers, allowing homemakers to collect water while cooking simultaneously. - Built-in Wi-Fi
This feature would require prior approval from the National Communications Commission. I have heard it is a costly and time-consuming process.
2. Compactness
It seems a long time ago that product designers began pursuing sleek and compact designs, yet this concept remains timeless. As housing prices continue to rise and kitchens become smaller, compact water purifiers are expected to stay in demand.
3. Material Science
Activated carbon is the most commonly used and affordable material in water purification equipment. The most effective activated carbon is made from coconut shells. However, global warming and the greenhouse effect have gradually reduced coconut yields in recent years, leading activated carbon producers to increase prices. Despite the existence of alternatives such as calcium sulfite, activated carbon remains the preferred material due to its cost and properties.
It is crucial for Taiwan to develop new materials for water filters and treatment solutions, possibly in collaboration with the Industrial Technology Research Institute or university incubation centres.
4. Energy Efficiency
While water purification itself consumes little electricity, hot and cold water dispensers do. On 1st September 2019, the Taiwan government introduced the Standards for Energy Efficiency Labelling and Energy Consumption for Hot/Cold Water Dispensers. This means that only dispensers with energy efficiency labels can be marketed in Taiwan. Developing energy-efficient water purifiers is now a race against time.
5. Conclusions
Almost all major global companies recognise the market potential of home water purification equipment. Over the past decade, companies from various industries, whether previously involved in water purification or not, have entered the market, making the sector highly competitive.
Though not directly related to technological trends, continuous cost reduction remains a shared challenge for Taiwanese companies in the home water purification equipment market. We all know that economies of scale are key to reducing prices for industrial products. However, larger quantities lead to fiercer competition. The ongoing challenge is to continuously cut costs without compromising quality, in order to remain competitive with leading global companies.
Membranes, the most expensive component in an RO water purifier, exemplify this.
Three years ago, the factory prices for a 50GPD RO membrane were:
- About $8 for a U.S. product
- $6–7 for a South Korean product
- $5.8–6.2 for a Chinese product
Now, the price of a Chinese product with the same quality is only $3.5.
Two Suggestions for Cost Reduction:
- Development of more efficient, affordable, and safer alternative filters
- Automation in production
This would also help resolve Taiwan’s labour shortage, lower costs, and achieve consistent quality.
