In an effort to standardise prices of packaged drinking water bottles, the Kerala Bottled Water Manufacturers Association today fixed the maximum retail price (MRP) for one litre at Rs 15.
"The decision ... is in the backdrop of consumers being fleeced by shop owners by charging exorbitant prices on bottled drinking water," KBWA President M E Mohamed told reporters here.
He said it was also a clear warning to multinational brands that local manufacturers are here to give them a run for their money and charged them of selling packaged drinking water at high MRP prices.
Justifying the price standardisation, he said a one litre bottle of packaged water costs only Rs 8 at the manufacturers' end, factoring in even the sales tax component and damage. This includes cost of inputs like bottles, cap, label, carton and filling charge, besides sales tax.
Distributors get a margin of Rs 1.25, which tallies the cost to little over Rs 9, association secretary, Sanjith K S said.
The end user is forced to pay between Rs 17 to Rs 24 for a bottle of one litre packaged drinking water.
Shopowners keep a 100-125 per cent margin which was not desirable, he said adding this had forced the association to intervene and protect the interest of consumers.
Standardisation of prices would also put an end to unethical business practices by manufacturers of packaged drinking water, he claimed.
The MNC brands were not part of KBWA and they are likely to come up with counter strategies, he said.
KBWA is the apex body of the bottled water manufacturers in the state commanding majority membership. Formed in 2001, the body presently has 92 members.
About three lakh litres of one litre bottles are sold in Kerala per day and the growth has been 100 per cent within two years.
About 20,000 kars of 20 litres each are sold in the state each day with hardly any safety parameters being followed, they said. They are not part of the KBWA.