In India tea is very popular, we can see tea shop acts in Bollywood movies, serials, songs, and many more.
From poor to rich everyone drinks tea both in the morning and evening.
I have also seen many people who have to drink tea otherwise they start to feel headaches and other things because drinking tea has become their habit.
In this post, I will share my experience in the tea shop business, from where to buy tea, profit margin, precautions, tea varieties, tea packaging, and more interesting things about this business.
Point to remember that black tea ( as shown in the above image ) is the first most popular tea and green tea is the second in India.
So this business is about black and green tea.
Grades of Tea
When I was new in this business, I was also cheated by traders who deal in tea in terms of grading.
These traders try to sell us cheap and bad quality tea at higher rates to us.
So it’s very important to check the grade of the tea.
Now probably you are thinking about how to check the grade of tea?
On every wholesale bag of tea, the grade of that tea is clearly mentioned.
There are many grades of tea but the most popular and which I use to sell in my shop are:
1. BP Grade: BP grade is also known as Broken Pekoe. This is the grade which is accepted by all the customers because of its quality and taste.
2. BOP: This grade is lower and cheaper than BP grade tea. This grade is for those who can’t afford BP grade Tea.
There are the two grades which I keep in my shop, other than these I don’t keep any tea.
Where to Purchase Tea
To purchase cheap but good quality tea we need to go to places where tea is manufactured in abundant quantities.
In India Assam state is the main place where we can get very good quality tea, either we need to contact online wholesale tea sellers or need to go Assam to find good tea.
We can also check wholesale shopkeepers in Assam with the help of Google Maps.
Only try to purchase BP grade and some quantity of BOP grade tea.
Starting a Tea Shop Business
The tea shop business is a business where quality matters a lot, if you are purchasing bad quality tea then people will not buy tea from you, and one day your shop will be closed so make sure to purchase good quality tea.
Here are the steps which everyone should follow while starting a Tea shop business:
1. Choose a Good Place
The location of a shop matters a lot in this business, the shop should be located in a crowded area of a city, this will people to see our shop which directly increases our sales.
This business will not work or not be profitable if someone is opening a shop in a small village or a place very few come.
2. Purchase Tea
Now after choosing the right place, we need to purchase tea.
Along with this we need to purchase:
- Green Tea because it is widely used in India for health benefits and reducing weight.
- Tea leaves, these leaves are sprinkled & then well mixed in tea while packaging, this makes the tea look more pro and attractive. ( Personal Experience 🤠 )
3. Bring Equipments
The equipment helps a shopkeeper to do work fast and accurately. Here is the equipment which is required to start a tea shop business:
- Weighing scales with a capacity of above 50 kg.
- Sealing Machine.
- A big bowl to mix leaves in tea before final packaging.
4. Required License
To start a tea shop business we will need to get an FSSAI license to make the product look original and trustworthy.
5. Packaging Bags
Eye-catching packaging of tea is very compulsory to increase sales in this business.
We need to purchase bags in 250 grams, 500 grams, & 1000 grams.
Here are the important things which should be mentioned on the tea bags:
- Manufacturing date and expiry date.
- Customer care numbers.
- License number.
- Shop address with name.
- Manufacturing address.
- Maximum retail price.
Getting customers in the tea business is a little bit hard due to stiff competition as in every city there are three to four shops of tea.
But here are the trick which I used to get customers:
1. Start Advertising: There are many advertising ways which can help to grow your business so make sure to follow them.
2. Giving Product free: You can also give 10 – 20 grams of tea for free to every people who come and go around your shop this will help them to see your tea taste.
3. Contact Shopkeepers: Shopkeepers can help us to grow our business at a rocket speed, we need to contact shopkeepers and give them our tea sample.
If shopkeepers start to buy from us then this is very good.
4. Increasing variety: A person can increase the product varieties which he is selling, like along with tea we can sell kirana store items like sugar, rice, flour, snacks, etc.
This can help us to get more customers in our shop and along with this, we can follow step 2 to increase our sales.
Tea Shop Business Investment
Before starting any business it’s very important to know the investment needed in that business:
|Tea Shop Business||Investment|
|Purchasing of Tea ( 10 bags )||50,000|
|Sealing Machine||3,000 to 22,000|
|Packaging ( 1000 Printed polythene bags )||2,000 to 5,000|
|Total||60,000 to 80,000|
To calculate profit in this business we need to subtract buying price from selling price.
Usually, we can get good quality BP grade tea at 120 rupees and we can sell it to shopkeepers at 160, and normal people at 200.
So if we sell retail then total profit will be:
= Selling price – buying price
= 200 – 120 = 80 rupees profit per kg tea
And when we sell wholesale to shopkeepers then, profit will be:
= 160 – 120
= 40 rupees profit per kg tea
🌟 I have not removed the packaging cost from the actual profit because the cost of packaging is very less around 1 to 2 rupees per kg which is negligible.
Here are some of the mistakes which a newcomer should avoid in this business.
1. Don’t change quality: Always try to purchase the same brand of tea which you are purchasing for a long time.
Because if you keep changing brands or companies, then the taste of the tea will change every time, which no customer likes.
2. Colour matters a lot: Most people judge the quality of tea with its colour and odour comes after preparing milk tea.
So make sure to ask the shopkeeper from where you are purchasing tea that tea should give colour and good odour otherwise I will return the tea bags.
3. Check odour: Check odour of tea by taking out 10 to 15 grams of tea granules on your palm from the bag, if you can smell a strong tea smell then that tea is really good.
But if no smell of tea then avoid purchasing that tea.
4. Maintain a Competitive price: No doubt people give very much importance to tea price, if you are giving good quality tea at a lower price than overall market to both normal customers and see, then there is a high probability that they will prefer your tea.
If your tea is overpriced than the market then very less people will buy from you.
That’s it for today’s post, I hope you have understood everything about the tea shop business.
Disclaimer: All the information provided in this post is for educational purposes only. Please do your own research before starting any business.