Holland-based Boxed Water wants to reduce plastic waste with paper cartons
Way before recycling and sustainability were common concerns, a west Michigan company offered an alternative to plastic water bottles.
Founded in 2009, it wasn't until recently, though, that the company, Boxed Water, grew. Their products can now be found everywhere from on Alaska Airlines flights to in Four Seasons hotels.
Even the co-founder of the Holland-based company is surprised at the trajectory the 15-year-old company, which makes a square-shaped cardboard carton filled with water, has taken.
"We're a start-up company in sustainability and no one's talking about sustainability," Daryn Kuipers, CEO and co-founder of Boxed Water, said in an interview in September as he recalled a conversation he had with the company's board in 2016. "People don't want us. How are we going to grow this thing?"
Plastic water bottle consumption hasn't slowed since the company's founding — despite a growing awareness that plastic can take hundreds of years to break down in landfills, emits greenhouse gases and contributes to climate change. Even as the popularity of reusable water bottles increases, like the craze surrounding Stanley tumblers, consumers are still buying single-use plastic water bottles in record numbers.
However, since Kuipers' conversation with the board nearly a decade ago, a broad swath of consumer-facing companies have looked for ways to increase their commitment to sustainability, and recycling accessibility and rates have risen.
Boxed Water has positioned itself as a way to enable these companies to tell their sustainability stories. It's a strategy that's working.
Boxed Water declined to disclose revenue but shared that it has increased in the last few years, jumping 22% last year compared with revenue in 2022. In 2022, revenue rose 64% compared with 2021.
The catch, though, is in the name of the product: "Boxed Water Is Better," the labels say, not best. Company executives say ideally, they wouldn't be in business, but they don't envision a near future where single-use water bottles disappear.
So instead, Boxed Water is trying to get every consumer that would buy a plastic bottle to purchase their product instead.
'We're not a water company'
In 2008, a group of friends, who would regularly meet to brainstorm ideas for companies, were trying to think of a solution for a problem. One of the friends had worked at a logistics company watching plastic water bottles be shipped in and out of warehouses that were filled with water from far-flung places and took up lots of space on trucks because bottles couldn't be shipped flat.
Kuipers was brainstorming a more sustainable solution, one that would require fewer trucks and bottles that could be filled at the source, not before they were loaded onto trucks.
"Why do you have to ship water from a foreign island all around the world?" Kuipers asked. "We love Michigan. We have freshwater and beautiful trees everywhere."
The group called a few manufacturers to find out where they could buy paperboard and then called around to dairy farms, who were surprised they asked if they could fill the boxes with water, not milk products. “They’re like, 'Water? What are you talking about? ' ” Kuipers recalled.
The company's first two customers were Madcap Coffee and Grand Central Market (which is now closed) in Grand Rapids.
They quickly sold out, although Kuipers and the other founders would get some skeptical questions, asking if it was just their families that were buying Boxed Water.
At that time, Kuipers said Boxed Water's appeal was its clean, simple look, similar to how Starbucks cups were once a status symbol like Stanley cups are now.
"We would say this all the time: 'Our product is the box,'" he said. "We have a really great product inside but first and foremost is the container. We’re not a water company. We’re a 'better for the environment' company."
Bottles and more bottles
Around this time, the Boxed Water team assumed that plastic water bottle use had hit its peak.
They were wrong.
Bottled water surpassed carbonated soft drinks in 2016 to become the largest beverage category by volume in the U.S., according to research and consulting firm Beverage Marketing Corp.
Bottled water has been around for centuries but grew drastically in popularity in the late 1970s when Perrier launched its bottled water brand in the U.S. with a massive advertising campaign, according to an excerpt of the book "Unbottled: The Fight against Plastic Water and for Water Justice" published in Fast Company. Perrier's success led other big beverage companies to want to get a piece of the growing bottled water market, said author Daniel Jaffee, and in 1992, it was acquired by Nestlé, the world’s largest food and beverage corporation. Shortly after, Groupe Danone, a French conglomerate, brought its Evian and Volvic waters to North America.
During the 1990s, this market underwent another upheaval with the entry of giant soda makers Coca-Cola with its Dasani brand and PepsiCo with Aquafina, Jaffee said.
A few other cultural shifts were occurring as Boxed Water was trying to grow: Americans were becoming more aware of the importance of drinking water.
There also was a spotlight on the safety of drinking water because of the Flint water crisis, when excessive levels of lead were found in the city's drinking water. A USA TODAY investigation identified nearly 2,000 additional water systems spanning all 50 states where testing had shown excessive levels of lead contamination.
Throughout much of this period, Kuipers wasn't involved with Boxed Water on a day-to-day basis because he was working at the Windquest Group, a private investment firm started by the DeVos family and the first investor in Boxed Water.
While Boxed Water was growing, reaching 80 employees at its peak and opening a second filling location in Utah in 2016, the company's board made clear it had to pivot because the company was spending more money than expected, Kuipers said.
"We’re not making money and in beverages, you don’t make money until you get acquired by a big company," he said.
Kuipers was asked to come back and run the company in 2018 and change Boxed Water's strategy, which also meant a big reduction in staff, he said.
'Fiji without the guilt'
Boxed Water initially followed the traditional beverage industry strategy of paying for placement on shelves at grocery stores, where it found itself competing directly with plastic water bottles, which are often cheaper than Boxed Water's product.
To stand out, the Boxed Water needed another approach. They needed to teach people about why their containers were worth the extra money. Plastic water bottles can technically be recycled, Kuipers said, so many consumers didn't see a problem with purchasing them.
Just 9% of plastic collected through municipal solid waste was recycled in the U.S. in 2018, according to the U.S. Environmental Protection Agency. That 2018 number is the most recent statistic available from the EPA.
However, while plastic water bottles are often accepted as recycling, that doesn't mean they are getting recycled. It's cheaper and easier to produce new plastic so the plastic intended for recycling still ends up in a landfill, among other reasons.
Kuipers and Chief Revenue Officer Robert Koenen decided they would try to grow the company with a different strategy.
They decided to pursue opportunities with hotels, aquariums, zoos and airlines, pitching Boxed Water as "Fiji without the guilt," a phrase that originated from the creative director of clothing brand Rag & Bone, who said he was sick of seeing rows of half-consumed Fiji bottles at the end of fashion shows, Koenen said.
The strategy worked. Even during the pandemic, when many venues were closed and consumers weren't traveling on airplanes as much, customers were ordering Boxed Water and having it delivered straight to their homes.
Over the past few years, Boxed Water partnered with high-profile companies such as Alaska Airlines, SoulCycle and CorePower.
"We are an enabler," Koenen said. "That's what we are more than anything. We are an enabler for you, Brand X, to tell your sustainability story."
When Alaska Airlines announced its partnership with Boxed Water in May 2021, it outlined its goal to reduce carbon emissions and detailed how it reduced waste onboard such as getting rid of straws and reducing packaging. Alaska Airlines said by using Boxed Water instead of plastic water bottles, it would "effectively remove 7.2 million plastic bottles from landfills per year — that’s equivalent to approximately 98,000 pounds of plastic," the news release said.
Since Boxed Water's reduction in staff in 2018, the company is growing again, and now has about 60 employees. At Boxed Water's filling station in Holland, city water goes through an eight-step filtration process, which includes reverse osmosis, carbon filtration, mineral removal and an ozonation process. A large machine then fills the empty boxes with the purified water and then a sanitized cap is twisted onto the box.
Boxed Water produced 1.6 million cases of water in 2023.
Better, but not perfect
In Michigan, cartons, like Boxed Water, generally are accepted at most large Materials Recovery Facilities in the metro Detroit, Lansing, and Grand Rapids areas, said Jeff Johnston, a spokesperson for the Michigan Department of Environment, Great Lakes, and Energy.
Still, purchasing Boxed Water is not the most environmentally friendly decision, one that Kuipers is quick to point out. Each carton is labeled with "Boxed Water Is Better."
"It intentionally doesn’t say we’re perfect," Kuipers said. "This is a piece of single-use."
Tom Lyon, a professor at the University of Michigan who studies corporate environmental strategies, said while he likes Boxed Water better than plastic, the brand's messaging portrays an overly positive view of the product to consumers. For example, he noted Boxed Water advertises its "carbon neutral" certification, which relies on offsetting through tree planting and other initiatives (as opposed to not directly emitting carbon); the term will be banned in the European Union by 2026 as part of a crackdown on misleading environmental claims.
Kuipers and Koenen, though, say until the day no one purchases single-use plastic bottles, Boxed Water has a role to play. That's not a scenario they envision will happen anytime soon, though.
"When that ends, then we'd be fine to be out of business," Koenen said, likening consuming water out of a single-use container to smoking — even though you know it is bad. "How long have we known how bad smoking is and yet people still smoke? So you're always going to have some people, for whatever reason, are still doing single use."
Boxed Water is talking with investors about how to grow faster and in the next two years wants to be back on more grocery store shelves, assuming the average consumers' awareness of sustainability has increased by then.
Ultimately, a future where Boxed Water gets acquired by a big company, like PepsiCo or Coca-Cola, isn't out of the question.
"Realistically, to help the environment and help the world get better, we need to get better distribution," Kuipers said. "So I'm 100% open to that."
Contact Adrienne Roberts: amroberts@freepress.com.
This article originally appeared on Detroit Free Press: Holland-based Boxed Water wants to transform beverage industry
