The success of India’s tea industry is hardly surprising, considering the beverage’s importance to Indian culture.. The tea industry is ripe with opportunities for entrepreneurs who own a tea business and are considering franchising. So if that is you, this guide is your magic wand!
Overview Of India’s Tea Business Industry Sector
For many years, India’s agricultural sector and cultural fabric have relied on the tea business. The company’s consistent product innovation, growing export markets, and rising domestic demand have all contributed to its meteoric rise over the years.
A synopsis of the most important trends and growth figures impacting India’s tea industry is provided below.
#1. It’s Level of Production
- Tea production in India has been steadily rising over the last several decades, according to historical data. Production averaged 1.2 million metric tonnes in the early 2000s. This rose to 1.4 million metric tonnes by 2022.
- Over the past two decades, the industry has grown by 1.5% to 2% due to increased cultivation and better farming practices.
- With 50% of India’s tea production, Assam is the major producer. There are a number of other notable states, including Karnataka, Tamil Nadu, Kerala, and West Bengal..
#2. Revenue and Size of the Market
- A 5% compound annual growth rate (CAGR) from 2023 to 2027 is predicted for the Indian tea market, which was valued at $15 billion in 2023..
- Loose-leaf tea, bagged tea, RTD beverages, and speciality teas create the most money. Rising urbanisation and changing consumer habits drive the highest proportion of packaged tea.
#3. Consumption within the country
- India consumes 1.5 kg of tea per person per year, making it one of the world’s largest consumers. Domestic consumption averages 1.1 million metric tonnes.
- Urbanites prefer premium and speciality teas, while ruralites prefer bulk chai.
- The industry has diversified thanks to a growing demand for health-oriented teas such as organic kinds, herbal infusions, and green tea.
#4. Overall exports performance
- Every year, India earns about USD 2.5 billion from the sale of about 400,000 metric tonnes of tea. The United States, the Gulf states, Iran, the UK, and Russia are important export markets.
- The rising demand for high-quality teas around the world, as well as India’s stellar reputation for crafting a wide array of aromatic teas, have contributed to a three per cent annual growth rate in export volumes over the last decade.
Opportunities and Prospects in India’s Tea Business
For all those tea business owners, here are some opportunities and prospects to look out for.
Potential Prospects:
- Segments for Premium and Speciality Teas: Opportunities exist in niche markets due to the increasing demand for premium and speciality teas.
- The latest in health and wellness: functional beverages that harness the healing properties of tea are sure to win over the health-conscious.
- A more robust online presence and the implementation of digital marketing tactics can increase exposure in new markets and boost revenue through digital transformation.
Projections for the Future:
- The extension of cultivation areas and the use of sophisticated agricultural practices are anticipated to promote production growth, which is projected to reach about 1.6 million metric tonnes by 2027.
- Rising disposable incomes, urbanisation, and a taste for premium and speciality teas are expected to fuel the market expansion, which is anticipated to occur between 2023 and 2027 at a CAGR of 5%.
- By 2027, the export volume has the potential to exceed 500,000 metric tonnes, thanks to persistent attempts to expand into new global markets and improve the standard of exports.
- Maintaining a focus on sustainable methods and ethical sourcing is expected to influence the industry’s future, in line with customer expectations and global sustainability goals.
Key Players in India’s Tea Business:
- Tetley and Tata Tea are two of the most well-known brands that are produced by the Tata Group of Companies, which is one of the most significant tea makers in India..
- Hindustan Unilever Limited (HUL) manufactures several well-known brands, including Brooke Bond and Lipton.
- Unilever Tea India manages a significant percentage of the packaged tea market.
- Goodricke Group, a significant tea producer, owns estates in Assam and West Bengal.
- A key leader in the tea export industry, Gokaldas Exports places a strong emphasis on both quality and sustainability.
Steps To Give Franchise Of Your Tea Business in India
India’s tea industry thrives because tea is part of its culture. Considering franchising your tea business? You’re entering a lucrative field with huge possibilities. To differentiate your brand and attract franchisees, you need meticulous planning, strategy, and knowledge of crucial factors to promote your tea business as a franchise. This post covers the essentials of franchise tea company promotion.
#1. Create an Unstoppable Brand Image
Build a strong, consistent brand identity to promote your tea company. Your brand encompasses your company’s beliefs, quality, and experience, not just its emblem. Franchisees will assess your brand to see whether it fits their ambitions.
#2. Create a scalable company plan
Successful franchises use a proven business strategy that franchisees may reproduce. Your model must balance profitability and ease of use.
#3. Franchising Support
Tea businesses with continued support will attract franchisees. More extensive support makes your franchise offer more appealing.
#4. Emphasise the market opportunity.
Show potential franchisees that tea is booming. Highlight the attractiveness of franchising a tea business, the desire for high-quality tea experiences, and the present developments in the market.
#5. Make an Appealing Franchise Package
In your franchise package, you should detail the startup costs, expected profits, and perks for potential franchisees. Offer something transparent and competitive.
#6. Utilise Digital Marketing
A strong digital marketing approach is needed to promote your tea franchise. Reach potential franchisees, increase brand recognition, and attract customers to boost franchisee sales via different internet platforms.
#7. Franchise events and expos
Tea business promotion is effective at franchise expos and events. Potential franchisees can meet and network with industry leaders at these events.
#8. Highlight Customer Reviews and Achievements
Your tea business will attract franchisees if they see others succeeding. Social proof and success stories reassure investors.
#9. Follow laws and regulations
Before franchising your tea business, make sure everything is legal. A sound legal foundation is essential for avoiding problems and preserving your brand.
#10. Prioritise Sustainability and Ethics
The tea business is seeing a rise in sustainability and ethical sourcing. These principles will help you draw in franchisees and consumers who share your concern for the environment and who will support your efforts to be a responsible business.
Strong branding, a reproducible business strategy, and successful marketing are needed to franchise your tea business. By prioritising these critical components, you can successfully establish your tea business as a franchise and attract the appropriate franchisees to assist in the growth of your brand. With the correct promotion techniques, your franchise can succeed in India’s and the world’s tea market.
Final Takeaways, Now Is The Time To Franchise Your Tea Business!
Thanks to consistent innovation, rising export markets, and solid domestic consumption, India’s tea industry has grown substantially over the years. As the world’s demand for high-quality teas continues to rise, the future seems bright for those who operate tea businesses, with a predicted CAGR of 5%.
Problems like climate change, shifting labour dynamics, and intense market competition, however, will necessitate careful preparation and flexibility. To be successful in the ever-changing tea industry, it is essential to embrace technological innovations, prioritise sustainability, and capitalise on growing consumer trends.
For more assistance call us at Sparkleminds.
