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Premium Waters: New Mississippi Production and Distribution Facility Anchors Company’s Southern Strategy

Posted February 22, 2017 in Case Studies

“We went through a rigorous site selection process and are very pleased to have selected Hinds County to build our technically advanced bottled water facility. Hinds County and the Jackson area met our criteria for investment, including a supportive labor market and excellent access to our customers in the region.”

Bernie Zarda, Executive Vice President and Director, Premium Waters

Premium Waters is a family-owned business that has its origins in a bottling company founded in 1870. In 1994, it changed its name to Premium Waters. Today, Premium Waters is one of the largest private-label bottled water companies in the Midwest and South, serving commercial, residential, and retail markets.

Premium Waters chose an Entergy Qualified Site near Jackson to build a 259,000-square-foot production, a $25 million investment. The ability to break ground immediately, plus Entergy Mississippi’s substation upgrades and economic development rider, influenced the company’s decision. The plant is scheduled to open in April 2017.

Business Challenge

Bottled water is the fastest growing segment in the beverage industry. By volume it is second in the United States only to carbonated soda in annual consumption per capital and is expected to overtake soft drinks in 2017. By comparison, however, it is a low-margin product.

Premium Waters, Inc. is an industry leader in providing quality bottled water products with 16 operations throughout nine states in the Midwest and the South. To take advantage of their bottled water’s growing popularity, Premium Waters, headquartered in Minnesota, has expanded in recent years. In 2002, it purchased Glacier Clear in Fort Worth, Texas, and Naturalle Springs in Greeneville, Tennessee. In 2008, it opened a production facility in Douglas, Georgia, south of Atlanta.

To maximize margin, Premium Waters has placed a premium on reducing costs. In recent years, the company has taken such measures as introducing highly automated bottling lines capable of handling 50 percent higher throughput — 900 to 1350 bottles per minute — with fewer employees. Adding a production and distribution plant equidistant between its Texas, Tennessee and Georgia facilities would enable Premium Waters to lower its shipping expenses, which represent a significant portion of its costs. The company teamed up with site location consultant NAI Robert Lynn in Dallas to locate the new plant.

Collaborating with Entergy

Entergy Mississippi played a significant role in helping Premium Waters find a suitable location. Entergy routinely participates in ONE Mississippi recruiting missions, an initiative that brings together representatives from the Mississippi Development Authority, regional economic development partnerships like the Greater Jackson Alliance, and the state’s four electric utilities.

During these three-day trips to cities like Atlanta, Dallas and Chicago, the team meets with site location consultants to promote Mississippi’s advantages and to learn about potential projects. In April 2016, the ONE Mississippi delegation met with NAI Robert Lynn and learned about Premium Waters’ plans to build another bottle manufacturing, production and distribution center in the South.

The state was able to provide attractive candidates for the facility location, thanks in part to Entergy Mississippi’s Economic Development Qualified Site program. Entergy works with communities to help ensure that their sites are qualified as “ready for development”. Hinds County proactively partnered with Entergy Mississippi and the site due diligence was previously performed – including the completion of numerous extensive studies, such as geotechnical reports, wetlands assessments and environmental studies. Since the site was an Entergy Qualified Site, Premium Waters was able to break ground immediately, which was critical in meeting their aggressive schedule for opening the facility.

Finally, another key factor in Premium Waters’ location decision was Entergy Mississippi’s Economic Development Rider Incentive. In addition to providing competitive electrical rates, Entergy Mississippi offers an economic development rider, which equates to a full 1-cent discount per kilowatt-hour for new or expanding industrial customers when they meet minimum usage thresholds. For Premium Waters, this incentive results in estimated savings of over $600,000 for the first five years of operation.

Business Solution

Within days of returning from the recruiting trip, Mississippi had responded to Premium Waters’ request for proposals, highlighting the advantages of the Jackson area. Jackson is not only centrally located from the company’s other Southern facilities, but it is also situated at the intersection of I-55 and I-20, making it easy to source materials and distribute bottled water across a large area of the South.

In the beginning of May, representatives from Premium Waters and NAI Robert Lynn traveled to Jackson for a first meeting, where the Mississippi team presented them with several sites. They returned a month later, having narrowed the sites under consideration to two. In July, Premium Waters chose to locate the new facility at the J. C. “Sonny” McDonald Industrial Park in Hinds County about 10 miles south of Jackson on I-55.

The Entergy substation serving the industrial park is unique because it has three electrical transmission sources, providing exceptional electrical reliability. When the project was announced, Entergy accelerated a planned transmission upgrade that will add significant capacity. The upgrade is scheduled for completion by the end of 2017. In the meantime, Entergy is enhancing the existing circuit and constructing a new distribution feeder to ensure reliable service for Premium Waters until the first phase of the upgrade is completed in August 2017.

In September 2016, Premium Waters broke ground on its $25 million, 259,000-square-foot facility. The new facility, expected to create 42 jobs, is scheduled to begin startup of equipment in April 2017 with production beginning by May.

Key Industries

Distribution and Warehousing, Food Processing