Fiji Water LLC



361 South Side Drive
Basalt, Colorado 81621
U.S.A.

Telephone: (970) 927-7631
Toll Free: (877) 426-3454
Fax: (970) 920-1852
Web site: http://www.fijiwater.com

Wholly Owned Subsidiary of Roll International Corporation
Incorporated:
1993 as Nature's Best
Employees: 50 (est.)
Sales: $25 million (2004 est.)
NAIC: 312112 Bottled Water Manufacturing

A subsidiary of Roll International Corporation, Fiji Water LLC sells water in a distinctive square bottle under the Fiji Water label. The product has become the favorite bottled water of movie stars, rock musicians, and supermodels. Because of its chic appeal, Fiji Water also has benefited from some free product placement, appearing on the screen in such movies as The Thomas Crown Affair and DodgeBall, and television series Ally McBeal, The West Wing, Friends, Felicity, and Just Shoot Me. Fiji Water is even found in trendy restaurants, albeit corseted in a silver slipper. Moreover, some master chefs insist on cooking with Fiji Water. The company maintains that its water stands out because of its purity, drawn from a 17-mile-wide, 400-feet-deep aquifer on the Fiji island of Vitu Levu. The rainwater that filled the aquifer is 450 years old, according to carbon dating tests touted by the company, the result of rain-water that trickled through layers of rock and earth on a journey that took hundreds of years to complete. Hence Fiji Water predates the Industrial Revolution by a wide margin and has supposedly escaped the effects of centuries of pollution. The limited supply of Fiji Water, as well as the distance it must travel to reach a market, is a major factor in the company's business model, allowing it to sell the product at a premium price and placing subtle pressure on consumers to buy the water while it lasts. Of course, the Fiji Water company is carefully controlling the flow of the water, periodically drilling holes to test the level to be certain the reservoir is not being depleted too quickly.

Founder's Launch of Business Career in the 1950s

The man behind the birth of Fiji Water was Canadian David Gilmour, son of an army officer-turned-businessman and an opera singer. As a child he traveled the world and, according to his recollections, developed a taste for exotic water. "From age 6, I had this feel for spring water," he told Danielle Herubin in a 1998 interview with the Palm Beach Post. "It was always a fascination, but I never found the perfect spring. It was always, in my opinion, flawed." Gilmour experienced a complete business career before resuming his fascination with water. He studied institutional management at the University of Toronto, and then following a one-year stint in the military started his business career in the 1950s, using $2,300 in savings to launch a company called Scan-Trade to import products from Scandinavia. Then in 1958 he teamed up with an old college friend, Peter Munk, to become involved in the hi-fi business. Their company, Clairtone, did well until they decided to try manufacturing televisions. The company failed amid some controversy, with accusations made that the two men had failed to keep shareholders adequately informed about how well the business was faring. Although Clairtone was liquidated by the government, Gilmour and Munk came away with some profits, which in the late 1960s they put to use building luxury hotels in the South Pacific, forming the Southern Pacific Hotel Corporation (SPHC), an enterprise that introduced Gilmour to Fiji and its more than 300 islands.

In 1971 Gilmour flew over the small uninhabited, 2,200-acre Fiji island of Wakaya and fell in love with its 32 pristine beaches. A year later he bought it for $1 million, and for the next 20 years used it as a family retreat. In the meantime, SPHC grew into the largest hotel chain in the region and was sold in 1981. Gilmour and Munk then used their hotel profits to form an oil exploration company that became Barrick Gold Corporation, involved in U.S. gold mining and acquiring Nevada's Goldstrike field, which turned out to be North America's largest gold field, producing 40,000 ounces a year. All the while, Gilmour began to develop the idea of building a luxury resort on Wakaya. In 1991 he opened the Wakaya Club, an exclusive ecologically sensitive resort. Gilmour dedicated the profits from the venture to the improvement of Fiji schools in honor of his daughter Erin. Her dream had been to teach art and history on Fiji. Gilmour sent her to Toronto to complete her education, but in 1983 she was found murdered in her apartment, a devastating, life-changing event for Gilmour.

Gilmour began developing a celebrity clientele for the Wayaka Club, the resort marketed solely by word of mouth. In 1999, People magazine offered a glimpse of life on Gilmour's pleasure isle: "Guests—including Tim Allen, Pierce Brosnan, Fran Drescher and Patrick Stewart—touch down on Wakaya's 2,500-foot airstrip in Gilmour's six-seater private plane and are greeted with a split of Taittinger champagne, tropical fruit and freshly baked ginger cookies. They then spend a luxurious week in one of nine thatched-roof guest villas, each complete with a four-poster rattan bed, a deluxe private bathroom and at least five employees to cater to their needs (cost: $1,200 to $1,400 per night). To enhance a sense of isolation from the outside world, Gilmour keeps the villas TV- and telephone-free. Recreation includes scuba diving amid dramatic coral reefs and hiking on scenic trails. For the less energetic, plenty of hammocks, masseuses and icy drinks await. Said Seattle racehorse breeder Karen Taylor shortly after arriving in April: 'I feel like I have landed on Fantasy Island.' "

The Wayaka resort served its guests native venison and vegetables and herbs grown on the island, but imported bottled French water. One day while playing golf on the island, Gilmour watched a guest drinking the imported water and it struck him as odd that he should have to send for water halfway around the globe when in all likelihood some of the purest water in the world was likely to be found close by—given Wayaka's virgin ecosystem, protected by a 1,500-mile buffer in all directions. Gilmour now enlisted the services of Barrick geologists to launch a search for the perfect water that had eluded him since childhood. They were eventually drawn to the island of Vitu Levu and a 50-acre parcel of land in the Yaqara Valley. Drilling and testing revealed a source of pure, delicious water, amply supplied with colloidal silica, which many believed helped to boost immune systems and counteract the effects of aging.

Building a Premium Brand in the 1990s

In 1993 Gilmour founded the production company of Fiji Water under the Nature's Best name, and then changed it to Natural Waters of Viti Limited in 1995, the same year the Fiji Water brand was created. The Fiji government granted the company a 99-year-lease in exchange for a royalty to tap the aquifer, and Gilmour invested $48 million to build a bottling plant on the site. In mid-1996 Gilmour recruited Aspen, Colorado businessman Doug Carlson to become cofounder and chief executive officer of Natural Waters of Viti. Like Gilmour, Carlson had enjoyed a highly successful career in the hospitality industry. In the latter half of the 1980s he served as the CEO of The Aspen Club Companies, Aspen's largest hospitality company. Then prior to joining Gilmour he served as chief financial officer of The Aspen Skiing Company, a $100 million hospitality and ski resort company. It was not an easy task convincing him to join Fiji Water, however. Carlson told the Denver Post in December 2000 that it took "six phone calls to convince me to go from frozen water to melted water." Although he agreed to run Natural Waters of Viti, he did not relocate to Fiji, instead setting up headquarters in Basalt, Colorado, since it was in the United States where ultimately the company would either succeed or fail.

Initially Fiji Water was served to guests at The Wayaka Club and to SPHC resorts where Gilmour was connected. In June 1997 Fiji Water was introduced in the United States, first in the core markets of Los Angeles and Palm Beach, Florida, and then branching out to statewide distribution. It was sold in half-liter and 1½ liter squarish plastic bottles. The label was partially clear on the front so that in combination with a double-sided label on the back, it produced an eye-catching three-dimensional effect. Early in 1998 the product came to New York City and achieved national distribution over the course of the year. Fiji Water's timing proved to be fortuitous, as Evian and Perrier, the longtime best-selling French water brands began to falter, losing market share as well as their premium status to a multitude of new water brands, some of which were backed by deep-pocketed corporations like PepsiCo, Inc., the marketer of Aquafina and Dasani. Fiji Water's pitch as the purest water in the world allowed it to find a premium niche in a crowded marketplace. Gilmour continued to cultivate the brand's upscale image, convincing tony restaurants to carry Fiji Water. Jean George, one of Manhattan's top restaurants, balked at placing a plastic water bottle on its tables, although chef Jean-Gorges Vongerichten liked the water. After being shown a silver coaster that the restaurant used to make other bottles "table-worthy," Gilmour had a silver sleeve fashioned to fit the Fiji Water bottle. All eight of Vongerichten's Manhattan restaurants now began serving Fiji Water, priced at $10 for a liter bottle. In Hollywood it also made the menu at the Los Angeles Athletic Club, Le Dome, and the Chalet Gourmet.

Company Perspectives:

The company's mission is to establish Fiji Water as the most desired premium bottled water in the world.

Fiji Water enjoyed exceptional growth for a new product, increasing sales 250 percent from 1998 to 1999, and 242 percent to 2000. The product grew almost entirely by word of mouth, with some of the most famous people in the world acting as evangelists, including Jacqueline Bisset, Nicholas Cage, Elton John, Bruce Springsteen, Wesley Snipes, David Bowie, Elle MacPherson, Cindy Crawford, Rod Stewart, and Leonardo DiCaprio. Fiji Water also benefited from free product placement on films and television shows, although it soon had to pay for the exposure. Gilmour also was not above taking advantage of less common ways to promote his water. In 2000 Fiji underwent the third coup d'etat in its history, and a group of self-proclaimed nationalists seized the bottling plant and shut down production. The plant was almost entirely staffed by locals, who convinced the revolutionaries to leave. When international journalists descended upon Fiji to cover the coup, Gilmour tried to drum up interest in the plant takeover story as a way to promote the Fiji Water brand, but enjoyed little success.

Increasing Demand on an International Scale in the Early 2000s

Rising demand for Fiji Water led to the construction of a 110,000-square-foot, state-of-the-art bottling plant, completed in 2000 on the aquifer. Demand continued to build in the 2000s, leading to the airlifting of a new bottle line in 2004 to help increase capacity to more than 50 million cases a year. By now it was being sold in eight countries, marketed as Fiji Natural Mineral Water in Europe and Fiji Natural Spring Water in Australia.

In December 2004 Gilmour elected to sell Fiji Water to Roll International, controlled by one of Hollywood's richest couples, Stewart and Lynda Resnick, who made their fortune with Teleflora and gained notoriety through their ownership of the Franklin Mint, which became embroiled in a messy lawsuit with the Princess Diana Trusts over memorabilia sales. According to press reports, the Resnicks bought Fiji Water for approximately $50 million. They expressed their commitment to growing the business, while Gilmour planned to continue to play a role in the company's further development.

Key Dates:

1993:
The company is founded.
1996:
Fiji Water is first produced and sold.
1997:
Fiji Water is introduced in the United States in Los Angeles and Palm Beach.
1998:
Fiji Water is introduced in New York City.
2000:
A new bottling facility opens.
2004:
The company is sold to Roll International.

Principal Competitors

The Coca-Cola Company; Hawaiian Natural Water Company, Inc.; PepsiCo, Inc.

Further Reading

Austin, Marsha, "Firm's Bottled Water from Fiji Grows in Popularity," Denver Post, December 26, 2000.

Helliger, Jeremy, and Vicki Sheff Cahan, "Enchanted Isle: By Creating the Ultimate Retreat, David Gilmour Turned Tragedy into a Memorial," People, June 7, 1999, p. 73.

Herubin, Danielle, "David Gilmour's Search for the Perfect Water," Palm Beach Post, April 6, 1998, p. 18.

"Island Water Floats on Luxury and Prestige," Beverage Industry, September 2000, p. 70.

McKay, Betsy, and Cynthia Cho, "Water Works; How Fiji Brand Got Hip to Sip," Wall Street Journal, August 16, 2004, p. B1.

Milstead, David, "L.A. Firm to Acquire Fiji Water," Rocky Mountain News, November 27, 2004, p. 2C.

Mortished, Carl, "The Miner Who Struck Gold When He Found Water in Fiji," The Times, June 9, 2003, p. 27.

Ragogo, Matelita, "Fiji Water Making Waves," Pacific, July 2003.

Todd, Heather, "On an Island Paradise, Fiji Water Sets a Standard of Social Responsibility," Beverage World , January 15, 2005, p. 10.

—Ed Dinger



User Contributions:

1
michael kearney
Report this comment as inappropriate
Aug 12, 2006 @ 6:18 pm
YOur history did not include Fiji Water Company Sale in 2005 for $65MM

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