Place potatoes in a large pot and add water to cover; bring to a boil. Cook the potatoes until easily pierced by a fork, about 10 minutes. Drain and set aside to cool. Place bacon in a large deep skillet over medium-high heat. Fry until browned and crisp. Drain bacon, leaving the grease in the skillet. Crumble the bacon when cool enough to handle. Cook onion in the bacon grease over medium heat until browned. Add vinegar, sugar, water, salt and pepper to the pan and bring to a boil. Once boiling, add potatoes, and half of the crumbled bacon. Cook until heated thoroughly. Transfer warm potato salad to a serving dish and sprinkle the remaining bacon over the top. Garnish with parsley and serve. Enjoy!