Is starting a tea business a good idea?

Answer 1

It's a good idea if you do it well. I would stay away from opening a tea store/shop. As others indicated, the margins can be okay, but the volume you will have to do to actually make any real money are pretty intimidating. The exception might be if you have some incredible concept and think you can franchise it.

I would really go for wholesale- sell through local stores. You can run that out of your house (at first) and then scale up only when you have to. Often even big retailers will cut you a break (i.e no fees for getting on shelf, etc) if you are small, local and bring something interesting to the table.

And therein lies your first and greatest challenge; coming up with a great story to make your tea idea viable. And it is really not a product issue, necessarily (which makes things more complicated). It's being able to tell a good story that connects with the consumer and therefore justifies a premium price (I'm assuming you are going premium since Lipton, et al have the low end covered.

See below for some links to some tea companies which I think have really good stories. They also may have interesting product features- but that is probably not the big deal.

Numi actually did start with a brother & sister team operating out of their house- so it can be done. But they stayed away from owning shops and started with some unique teas with good stories and packaging. Now they have much more..

Answer 2

Will you be selling only "raw" or also brewed? Storefront or from home or wharehouse? Generally selling something someone can easily get on own or else where is risky. starbucks and supermarkets can easily put you u under since they have other products and many existing locations already. Tea is inexpensive and low profit item. How much tea will you need to sell to cover expenses. Then calculate how much profit you will make and compare to working for someone else or if sold something else.

There is of course places in Japan and China that sell 1 cup for thousands of dollars.

Answer 3

It depends on where you are and who your clientele is. Try conducting a survey to see if this service would be accepted where you are. Do you have competition? Are you going to cater to a walk in trade or an on line trade? Do your research first and it will pay off in the long run.

Answer 4

If there's none in your area, why not go forth on your dreams? Even if there is one close by, don't let that stop you.