In the wake of the offloading (almost exactly 3 years ago)of the largest global tea business, encompassing many familiar brands, there is reason to suppose that this will not be the last sell off. As those companies that acquired diversified business portfolios focus in on core operations, tea appears, more often than not, to be discarded.
This divestment of tea assets seems at odds with the constant news that the industry is healthy and growing.
The truth is that there exists a predominant global "camellia sinensis" derived tea drinking habit delivered by a raft of international and regional brands that have strong allegiance within the populations they serve but that as spending power transitions to younger generations, whose values are noticeably different, these brands lose relevance and equity.
Is this unavoidable, a natural inclination of the young, or is there an element of self-fulfilling prophecy here,? I think so!
The new age of tea is most definitely here, one where anything infused latches on to the category, irrespective of botanical species and, unlike predecessors in the category, variety rather than consistency is heralded. This juxtaposition, one of many between traditional tea packers and the new wave, is as unbelievable as it is factual. Like the success of punk rock, in the late '70s (1970's for those of you too young to pogo!), the new tea world cares little for the traditional and the consumer finds this both unexpected and refreshing. The traditionalists had to, grudgingly, admit the renaissance and adapt which saw a spending spree by large CPG entities, constrained by structure, gobbling up any new wave tea company that appeared to have legs.
Some of these acquisitions were successful but not the majority, the stumbling blocks including the destruction of everything tangibly different and therefore attractive, as these crafted individuals were re-shaped to fit into a portfolio of other household brands and scaled up and dumbed down, beyond recognition of their personal organic beginnings.
So how does a new business break into and stay in the tea business, indeed is it even possible?
The answer is a simple resounding "Yes!"
There is more room for newcomers than ever before; if we only translate the lost share of traditional supermarket tea into other tea possibilities, there is a veritable ocean to swim in.
The other exciting aspect of today's market is the ease of entry (that is not the ease of winning!) as e-commerce makes cost of entry low and acts as a retail incubator, where the demand and offerings can be matched, through analytics, in your home kitchen, to give you a decent "steer" towards what will and what will not work.
No bricks and mortar expense required, not even for production, you can simply source product from a growing number of processors and have this delivered directly to fulfillment houses, dependent on how aloof you wish to be.
The downside with the above is that you will miss out on that intangible which makes brands attractive, the investment of heart and soul is a marketable asset; consumers are attracted to passion and expertise, homegrown or otherwise. There are of course a very great number of younger people, than me (not a difficult bar to limbo under!) fully engaged in the industry and hungrily educating themselves in a world where access to data, or indeed origin itself, is far easier than it may have been before. These are the new professionals, the new diviners of tea truths but they are emancipated from convention, broadening the exposure of consumers which we must welcome but be wary of.
The old CPG companies may be unattractive global entities to the young consumer but they had their advantages; the rigor applied to procurement and production controls made these relatively "safe" houses for the consumer. Quality control and assurance (for which read "Risk management") is the bedrock of such companies operations and easily managed the old industry of black tea. Of all the materials under the umbrella of "Tea" Camellia sinensis is one of the safest, due to it's manufacturing process which ends with a good deal of heat and controlled drying (Properly manufactured!). Now, add a myriad of ingredients that we now infuse which undergo air drying that may or may not render the product safe but leaves it more desirable to insect life than if it were fired. This is not a "have a go at herbals" but a generalization (very) to point out that the industry now has many more raw material risks and yet is in the hands of some that, either through lack of knowledge or the usual prioritizations of the start up (Not QC/QA, I hazard), are not managing the consumer risk as well as they could be.
The good news is that "tea" is predominantly brewed with very hot water for a good period of time, negating much of that risk but it still exists.
But, I digress, tea is still an attractive place to play but I would invite the newcomer to consider the old adage of " If it aint broke, don't fix it!" and consider that camellia sinensis is a great place to start your tea journey. It tastes wonderful in all it's many varietals (Yes, quality tea, tastes great), is safe and manageable, carries the majority of supportable health benefits in the category and is treasured by today's drinkers, in a teabag or loose .
What is more important than range (Variety needs keeping in check) in my mind is connection and excellence. Know where your products come from, ensure that they do no harm and deliver living incomes to those in the supply chain and ensure that they are "Da bomb" when tasted; do that and you will win!!
Bon chance!
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