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Analysis on Liquid Filling Machines a Clothes Call

The other night, like a couple million other Canadians, I was watching Dragon’s Den.

I better back up, my Canadian is showing. For those of you not from the great white north, Dragon’s Den is a reality show that gives entrepreneurs the opportunity to pitch their idea to 5 wealthy dragons. The dragons listen to the pitch, weigh in on the business and ask all sorts of questions about it. They then decide whether to invest in the company, based on the entrepreneur, the pitch, and the numbers. Once they agree on a price for a percentage, lawyers jump on the deal, ironing out the details, verifying the financials, etc. Finally, if the company passes scrutiny, one (or more) of the dragons will invest their actual cash in the business.

American readers may be familiar with Shark Tank, which is a similar show. Personally, I don’t miss an episode of Dragon’s Den, and try to catch Shark Tank whenever I can. Watching the pitches is riveting television.

Back to the episode of Dragon’s Den in question. An entrepreneur from Quebec had one of the coolest ideas I’ve seen on the show in a while. He invented a machine that people would use to refill detergent bottles. They choose how much detergent they want, either bringing their own container or buying a reusable one at the store. The customer presses the button and presto, the machine fills the jug. The cost? About a $1 less than the equivalent bottle of detergent.

I like the concept. But there are some problems. Let me lay out the bullish case and the bearish case for the company.

Bullish reasons for liquid filling machines

Considering I’m writing on Sustainable PF, I’d be amiss if I didn’t start off with the ecological benefits. From a consumer’s point of view, a refillable bottle could save 2-6 bottles per year, depending on how many cloth diapers you’re washing. Just imagine how many bottles of detergent the average family would throw out over a decade and the volume of plastic involved. The last time I was at the landfill, I saw at least a couple detergent bottles, and I sure wasn’t looking very hard.

Demographics are also going in the right direction for this business. Just take one look at the comment section of this site, and you’ll see all sorts of people who legitimately care about the environment. This whole sustainable living thing isn’t just a passing trend, and more and more people are jumping on the bandwagon. For the detergent business, this means a growing base of potential customers.

The concept has kind of been proven as well. A similar machine exists already in many grocery stores, which dispenses bottled water. Customers like it because it’s cheaper than buying the already bottled stuff, and they can refill whatever size of container they want.

Another big plus for the company is the potential for grocery stores to make more money selling detergent this way. You know how detergent is cheaper per use if you buy a big bottle of it? Well, multiply that by about 50, and you can see how a store could use these savings to give the consumer savings while making a higher margin. Detergent sales are competitive, each store wants to have a good price on the big brands to draw people into the store.

Bearish reasons for liquid filling machines

There’s really only two negative things I can think about the concept.

Firstly, the concept needs to get people to change their habits. Grandma Mildred has been buying her Tide since 1951, and she’s not about to change her habits now. Like any business, there needs to be a certain volume of business to make it worth everyone’s while.

Secondly, and this is the elephant in the room, is how long the big players in this space are going to tolerate a new competitor.

In Canada, the detergent market is basically owned by two companies. Proctor and Gamble makes Tide and Gain, while Unilever manufactures Sunlight. Those 3 brands control probably about 90% of the market.

At some point, once the detergent dispensing machine gets to a certain mass, one of the big players will awaken from their slumber. If I was in charge of Proctor and Gamble, I’d either:

a) Copy it

b) Buy it

Considering the reach of P&G, nobody would be surprised if they rolled out their own filling stations. The consumer would know they’re getting the proper brand, P&G would make a little more profit, and the consumer would get a little break on cost. They’d squash the little guy faster than he can beg for mercy.

This is where we ask for your opinion. Would you use one of these liquid filling machines? Water, detergent .. other? Do you think it’s a viable business? The comment section is all yours.

25 thoughts on “Analysis on Liquid Filling Machines a Clothes Call

  1. I personally love the idea of detergent filling stations. There have been similar concepts floated for car oil at gas stations.

    From a business perspective, if I was the founder of the detergent dispensing machine company, I wouldn’t include my own brand of detergent to go with it. Instead I bypass the grocery stores and go directly to to Proctor and Gamble or Unilever and make the product available to them to buy and install in the grocery stores themselves. They could then continue their own little private war in the detergent industry, and I could still get my product into the grocery stores without taking on some of the biggest retail players in Canada. Everybody wins.

    Great idea though, I sincerely hope it comes to fruition and hope I start seeing these in stores over the next few years.

      1. Of course that would be the option but if Company A opts to buy my product and Company B opts to build their own, COMPANY B will lose first mover advantage because of the delays in getting their as-yet unbuilt product through design, prototyping, testing and through production. Not to mention obtaining the various certifications required to bring a product like this to market in Canada. A six month lag could mean millions lost in market share.

  2. geez louise- how about a spoiler alert at the beginning?! Just kidding. I love Dragon’s Den too but I watch it whenever I have time during the week on cbc.ca. Consequently, I have not yet seen this past weeks episode…

  3. It isn’t a bad idea but I think most people would be too lazy to bring their laundry bottles in to refill. Maybe if one of the established brands offered it at a significant savings it would take off but then they’d be undercutting their own sales. I wouldn’t invest in the company.

  4. maybe I would consider using the machine. I already use the house brand laundry detergent. I also make the effort to take reusable shopping bags to the grocery. I could just toss the empty bottle into one of those bags.

    1. It definitely appeals to a certain type of consumer. If you’re serious about it, you’d remember your jug.

  5. I think it’s a great idea, especially for the environmental aspects you mentioned, and because people who don’t do a lot of laundry (like me) wouldn’t be forced to buy a giant tub of detergent that would last years and years. (Seriously, I just finished off a jug I bought FOUR years ago.)

    That said, I’m not sure it’s a viable business, because it seems to lack options. There are a bajillion types of detergent, and people like their brands. If they just offered regular run of the mill stuff, I probably wouldn’t use it. For one, because I prefer the environmentally friendly stuff, and for two, perfumey scents give me a headache, so the “typical” one they chose would probably fail on both those counts. If like, Method laundry detergent offered a vending machine type refilling station, I would be ALL over that.

  6. This sounds like an interesting show. I’m familiar with Shark Tank although I haven’t watched an episode. I am still deciding on the liquid filling machines. I would need to do more research, but it does sound cool.

    1. In theory, a perfect solution for the company.

      But, as I alluded to, what’s stopping P&G from just making their own? Although, I assume P&G would wait until the concept caught on, so you’d have the advantage of being the first to market.

  7. I saw the show episode and thought it’s a brilliant idea. Too bad the none of the dragons decided to invest in it. I would use it…for the environmental aspect of reusing the detergent container.

  8. I think a filling machine is a great idea. We typically by eco-friendly detergent, so I would hope that these filling machines could meet the different consumer preferences, and I’d want to have some assurance that you’re getting what you think you’re getting. It could be hard to tell just by looking at the detergent. Aside from those logistical issues, I think it’s a great idea and I would use it.

  9. Like you, I LOVE the Dragon’s Den and try not to miss an episode. I thought the idea was brilliant when I saw it but do understand some of the dragon’s misgivings of being squashed by the “big guys.” But, me being me, usually rooting for the little guy and loving to see the big guys given a run for their money, that would be a reason for me to support this idea.

    When I bought water in large jugs, I occasionally forgot my jug but there were ways around that….and I’m sure this would be the same. If people were really serious about their support, they would make sure to remember their jug when they needed it. As for the big guy copying it, I’d think a patent would take care of that….or maybe they need to change the laws to protect things like that the way pharmaceuticals are protected from generics. Hey we can dream, can’t we?

    Mary

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  11. I agree 100% with this idea. As engineers, 10 years ago I had proposal for portable filling system for shampoo and liquid detergent. With refill station, we will get 2 advantage side : economic and environment.
    economic : Products will cheaper, because we pay only for product that we want to use. We know that Packing cost is 40% for price of product.
    environment : Reduce plastic waste. Mostly packing made from plastic and plastic can’t be destroyed naturally.

  12. I know it’s been a long time but it seems that this idea is going to be applied in Poland. Actually I’m trying to find origins of this idea. Could someone help me to find this dragon den episode? Thanks!

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