Alberta Hutterite colony bottles water to diversify

Clear Lake Colony is challenging the definition of “value-added” with bottled water production

Across the West, Hutterite colonies are successfully diversifying into other business ventures, but this is a unique story at the very rural Clear Lake Hutterite Colony, an hour and a half southeast of Calgary.

Clear Lake, it turns out, is home to a natural spring well — and to a group of very forward-thinking farmers, including brothers David and Paul Waldner.

The colony manages 12,000 acres of land, 9,000 of which are cropped, and like other farmers in southern Alberta, they are always thinking about rainfall. And like their neighbours, they’re always thinking about two things — first, that they need to do a good job of farming in dry soils, and second, if they’re going to be sustainable, they need to find additional revenue streams.

“It was going to be touch and go a lot of years because it’s definitely a dry area and it’s very sandy,” says David Waldner, the colony’s financial manager. “We knew we needed supplemental income.”

The entrance to the Clear Lake Hutterite Colony southeast of Calgary.
photo: Loree Photography

Perhaps, then, it was serendipity when the colony purchased a ranch in 1979. One patch of the newly acquired land made them all collectively scratch their heads. In an area baked brown, there was one valley on this ranch that was always green.

They wondered what was so different about the land that sat close to home, but of course they had farmland and animals to manage.

However, by 1988, the itch needed to be scratched. John Waldner, the uncle of David, dug a test hole with a backhoe, and when he did, he didn’t have to drop the bucket too deep to realize why that ground was always so verdant and lush.

By the next morning, the entire hole filled with water. It was a spring.

In hardly any time, David and his brother Paul began dreaming up plans for the spring’s water.

They got the water tested at AGAT Laboratories in Calgary. As they suspected, it was suitable for drinking.

Why did their spring water have such a distinct taste? The answer became the foundation of a bold business plan.
photo: Loree Photography

But why did it have that distinctly different taste? The lab analysis showed the water had a pH of 8, well within a normal range, but certainly on the high end. Typically, surface water has a pH reading anywhere from 6.5 to 8.5. Groundwater is between 6.0 and 8.5, with 7.0 considered neutral.

And there was another discovery too. Elite athletes and health nuts often seek out alkaline water because they credit it with neutralizing acids in the body. Others believe the high pH liquid can tackle high blood pressure, diabetes, high cholesterol and more.

So even though the idea seemed quirky at first, it began to take hold. Why not create a value-added bottled water business? Why should farm-based value adding have to be confined to crops and livestock?

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Paul Wipf

Turning on the taps

It didn’t take long to start making decisions, and in 1992, they launched their first foray into the water world by teaming with a Calgary company.

As happens, that first effort proved a learning experience; the business venture fizzled out fairly quickly.

The Waldners kept thinking, though, and kept observing and asking questions, and five years later, they reignited their business and began to bottle five-gallon jugs in-house with a semi-automatic bottling line.

In addition to selling to friends and neighbours, the idea was to approach grocery stores in Calgary and southern Alberta such as Sobeys and IGA, and it proved successful.

It meant they started small, filling orders for five-gallon jugs and cashing cheques under the name Your Choice Bottled Water.

It turns out water bottling has serious technology that needs mastering, like any kind of agriculture.

“Back then, there were very few 500-ml bottles on the market,” says David. “We decided we didn’t have the manpower, and two guys could do the five-gallon bottles.”

It proved more than manageable. The market needed 40 jugs per week in 1998 and it wasn’t a problem for the brothers to produce them. However, word spread and the 40 turned into 50, and the 50 turned into 100.

Numbers steadily rose; today they bottle between 5,000 and 6,000 five-gallon jugs each month.

By 2013, demand had steadily risen. Not only had they maintained customers with big box and independent grocers, they had also added more than 100 new clients between Calgary and the American border.

“With us, that’s the big thing, it’s the location,” says Paul. “There are no big cities in this area. We have small towns and hamlets.”

Water companies in big cities might have built-in advantages with their scale of operations. Still, Paul says, “You can have a good product and be a good marketer, but if the freight kills you, there’s no advantage.”

“What I recommend anyone do is start smaller, start cheaper and build it up a bit,” says Paul. “Then, when you see your client base has a decent growth to it… that’s when you can start thinking seriously.”
photo: Loree Photography

However, large water jugs have a limitation. You can’t exactly put one in the cupholder in your car, or carry it in your knapsack. So while the brothers were happy with the growth of the five-gallon business, they always wondered about a smaller size.

Opportunity knocks

By 2012, after 15 years of bottling water in jugs, word about their water had flowed around, and they began to get queries about a hand-held bottle and the possibility of a custom label.

However, with only five-gallon jugs in production, the brothers had no choice but tell companies such as The Bay and Northlands Coliseum they couldn’t do business.

Paul remembers those interactions well.

“I was very anxious,” he says of reluctant rejection calls he had to make. “We knew we had a premium alkaline water. That was the frustrating part — having a premium alkaline water and not being able to market it the way we thought was appropriate.”

“With the big jugs, you can’t ship them that far, but with a pallet of bottled water, you can actually ship it quite a ways and it’s feasible. That’s what started us. We knew we had no choice. In order to be competitive, we knew we had to switch.”

They began to look into a new bottling line that could service 500-ml bottles and add a label that could not only feature their business name — Your Choice Bottled Water — but also be swapped out to give a company the option to splash its own logo on the label. That way, other companies could use that alkaline differentiation as the foundation of their own go-to-market strategy.

“What better way to advertise your brand than with a high-quality water?” says David. “It goes hand-in-hand. It reflects on the business, too. Ask yourself, ‘who can live without water?’ Everybody needs water.”

In typical Waldner fashion, they thought about it for quite some time. After all, they were busy enough with existing water orders, a 9,000-acre farm, 10,000 layer birds and 400 farrow-to-finish hogs.

By 2016, the pondering concluded. They would move into 500-ml bottles. And despite alkaline water fetching premiums of $3 per bottle in certain retail markets, the brothers did not begin to sell jugs and bottles of water as a get-rich-quick scheme. There appears to be real altruism at work emanating from the Clear Lake Hutterite Colony.

The Waldners aimed to control their exposure by growing one step at a time, but the move to 500-ml bottles meant $800,000 in new equipment, much of it from China, which in turn led to hiring a sales team, truckers and more.
photo: Loree Photography

“We know we could get a premium, but we focus on getting a good quality water,” says David. “A lot of people drink Evian and it’s high quality and high pH. So, why pay for all that freight if you can get it locally? Look at the carbon footprint. We can offer a premium product for a very reasonable price.”

After selecting an all-new setup, parts arrived from various locations, with about three-quarters of the components originating from China.

However, the company was unable to secure visas for its employees to come over and train, aside from one electrical engineer, so the brothers improvised. They corresponded with the company via email quite often and simply learned what worked and what did not through trial and error.

The tab for the top-of-the-line setup reached $800,000, including the bottling line, laser machine, labeller, blow moulder, shrink wrapper, capper and more.

To prepare for the expected glut of water orders, they outsourced their trucking to a nearby company in Lethbridge. The move didn’t save them any money, but it sure saved time pounding the pavement.

In addition, they also hired three full-time sales reps and told everyone with a pulse about their new 500-ml offering.

By June 2019, the colony had shipped more than 100,000 bottles, and orders continued to pour in. They were also doing custom label work for companies, as well, and, less than six months after the introduction of 500-ml, they brought a 350-ml bottle online, again to meet companies’ changing demands for their customers.

“We found markets where the 350 was more economical for product waste reasons,” says Paul.

The goal, says David, is for a customer to buy their water and say, “Wow, this is quality.” It’s a goal their new bottle achieves.
photo: Loree Photography

With a capacity to handle more than one million bottles per month, the colony hasn’t quite maxed out, which is something everyone hopes for.

“If you were not a patient person, you kind of learned patience,” says Paul with a twinge of reflection. “Things don’t move as fast as you want. You live and learn.”

With sunk costs and sparkling new machinery, there is a loan they must pay back to their bank, which only adds incentive to get the water into the hands of thirsty customers.

Paul also reflects on tweaks he’d make to the value-added business.

“What I recommend anyone do is start smaller, start cheaper and build it up a bit,” says Paul. “Then, when you see your client base has a decent growth to it… that’s when you can start thinking seriously about getting better machines and something that’s there for the long haul.”

He also says it’s one thing to look at the specs of the equipment you want to buy, but parts availability is the number one thing to concern yourself with when it comes to such an operation.

One of the Waldners’ clients is United Rentals out of nearby Lethbridge, a city of 70,000. Country Guide talked to Colton Gross, a sales rep for the company who has been buying water from the Waldners with a custom label since early 2019.

“It’s always nice when you hand something out and it has your name on it,” says Gross. “Anybody can go and buy normal bottles of water from Walmart or Costco, but to have your name on it is pretty neat.”

Gross bought three pallets after sampling the water and his choice is Your Choice Bottled Water. “It’s got a pure taste to it,” he says, adding he’d be reordering more.

Testimonials like that reassure Paul and David they’re on the right track. “Companies go through a lot of water, they might as well have a really good water,” says David.

Future focus

Today, with sales reps in place and a smooth process that starts with a blow moulder and finishes with a custom label and shrink-wrapped, palletized product, the brothers have their eyes set on another big goal.

Their bottle is made of conventional plastic, just like many others. With disposable plastics becoming such a hot topic in recent months, they decided to pursue a natural-based resin for their bottles, which will degrade, even in a landfill, within five to 10 years.

It’s another way for the farmers to offer a premium on an already unique product.

“You can source considerably cheaper plastic, but if you promote your company, what do you want?” says David. “Do we want to sell a cheap bottle? No. This is value-added. It’s the impression that people get. You want a high-end bottle so your client’s first impression is, ‘Wow, this is quality.’”

About the author

Contributor

Trevor Bacque is a freelance writer and journalism instructor. He has written extensively about agriculture since 2012 and is the current president of the Canadian Farm Writers’ Federation.

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