Preparing for National Lead-Free Compliance

Lead Free Changes Everything

The key date: January 4, 2014 — That's when manufacturers, distributors, builders, and plumbers across the country must comply with the Reduction of Lead in Drinking Water Act, affecting all potable plumbing products sold or installed in the United States.

Right or wrong, love it or hate it, the “California/Vermont issue” is now the law of the land. Make no mistake; this is the defining moment for all of us, shaping our success or failure for years to come.

This paper serves as the first of several conversations, which we hope will inform and prepare you and your business to adjust to this new standard. Let's be clear and not pull any punches; it's going to be a lot of work. But Watts Water is ready, willing, and able to serve you every step of the way.

What Does “Lead Free” Mean to Your Business?

After January 4, 2014, when the Reduction of Lead in Drinking Water Act goes into effect, the wetted surface of every of pipe, fixture, and fitting sold in the United States for use in a potable water system must contain less than 0.25% of lead by weight.

Put simply, it means every potable plumbing product that does not meet this new standard will be illegal and cannot be sold or installed for use with potable water. Period.

States will be required to implement the new lead-free requirements through state or local plumbing codes, and some states may also enforce the requirements through consumer-protection statutes or other laws. Violators of the federal law may be subject to monetary penalties, government lawsuits, or civil lawsuits brought by concerned citizens. We also anticipate that plaintiffs' lawyers may see this as an opportunity to profit by targeting companies that sell noncompliant products with lawsuits.

Managing Risk

Lead free changes the landscape for your business and introduces risks — from your competitors, from product quality issues, and possibly from legal and regulatory action.

  • Risks from your competitors — In recent times, the challenges of running a successful business have been brutal, and competitive pressures have not helped. With the change to lead free comes a competitive risk as others attempt to lure customers away by any means possible. Allowing your competitors to get ahead of you on lead free means running the risk of losing your customers and sales.
  • Risks from suppliers with poor-quality products — For some suppliers and manufacturers, the science of lead-free product development is in the Stone Age. Quality concerns may be rampant, depending on the type of product, and may be evident only after several years of use. Protect your business. Work with leading suppliers and manufacturers who have a history of lead-free product research and development. This will ensure that the products you sell start from the highest quality materials and processes and will meet or exceed lead-free requirements.
  • Risks of legal liability — Many incorrectly believe that manufacturers or suppliers are the only ones at risk when making false claims of a product's lead-free compliance. This could not be further from the truth. As with state laws from California and Vermont, the national law states, “products introduced into commerce” must comply with the Reduction of Lead in Drinking Water Act.

Distributors and wholesalers selling products that falsely claim to be lead free or that are of poor quality could be just as liable as manufacturers or suppliers. The law goes on to state that legal action can be brought by any individual, corporation, company, association, municipality, state, or federal agency. Distributors and wholesalers found guilty could face significant monetary penalties.

Now more than ever, you must ensure that the products you sell are from suppliers you know and trust. Relying on questionable overseas manufacturers or fly-by-night suppliers may be penny-wise, but it is certainly pound-foolish.

Failure to Plan Is Planning for Failure

It may seem as though 2014 is a lifetime away, but considering all of the potential problems, don't wait to get started planning and implementing your transition. Remember, avoiding failure is not seeking success.

Start your transition by:

  • Evaluating your current suppliers Do they have what it takes? Many of your existing suppliers may not have a complete understanding of lead free or have a full line of compliant products ready to meet its requirements. Ask questions and test them; they work for you, and you shouldn't have to pay for a supplier's on-the-job-training. This also applies to the supplier's representative. If you aren't satisfied, weigh the options of changing suppliers. There's too much at risk in not doing so.
  • Knowing what's in scope and confirming it with your suppliers. Whether that's a general sense of product types or a deeper, product-by-product understanding, your first move is to contact each supplier and confirm if their products are already lead-free compliant or if they have clear plans to transition to a lead-free equivalent in time for your business to meet its goals. New lead-free equivalent products will probably mean a new SKU or model number and possibly changes to a product's name, weight, dimensions, packaging, or price. Understanding the full scope of what has or could change will minimize the risks to your business.
  • Working with your suppliers on transition planning. In most cases, you'll want to target and sell off low-volume products first. Low-volume may mean specialty or seasonal products. Work with your suppliers to identify low-volume products based on your current and historical inventory. High-volume products are your fast movers that are ordered and restocked often. Transitioning to lead-free high-volume products will typically occur later in the transition plan.

As we said in our intro, let's not pull any punches. In many cases, these changes come with increased workloads and expanded pressures across your organization.

Our Responsibility Is Your Success and Your Trust Is Our Goal

We're addressing this:

  • In how we work — By gaining valuable insights during the transitions of hundreds of wholesalers across California, Vermont, and Maryland. By striving to be our customers' most trusted advisor. By continuously adapting our inventory planning and logistics with intelligent responses to changes in the market or the industry. By understanding that it's your reputation and livelihood at stake. By achieving your goals with the expertise, power, and flexibility of our industry-leading supply chain.
  • In how we innovate — By expanding on our expertise in refining existing lead-free materials and continuing our commitment to lead-free material research and development.
  • In how we grow — By breaking ground on our 30,000+ sq. ft. expansion to our Franklin, NH, foundry, representing our commitment to the continued research, design, development, and testing of the highest quality lead-free products in the industry. Franklin's multimillion-dollar expansion will be complete in 2013, producing lead-free compliant products within days of its launch.
  • In how we partner — By rallying with other manufacturers to petition the Environmental Protection Agency (EPA) to clarify ambiguous issues in the national law.
  • In how we lead — By launching WeAreLeadFree.net, the first dedicated resource for educating, informing, and transitioning distributors and plumbing professionals in the country. The site went live early in 2009, leading the industry nearly a year before California's lead-free law went into effect. To date, we've had over 50,000 people come to our site and start their journey.

Together We Succeed

In our introduction, we said that lead free is the defining moment for our industry that will shape all of us for years to come.

In preparing for this, it boils down to uncertainty vs. certainty. Can you say with certainty that your current suppliers have what it takes to succeed?

We are the Watts Water Technologies family of companies. We have the expertise, know-how, and desire, and we're ready for the opportunity to show how together we can all succeed.