Tee Off
TGBL has come a long way from the days when it took over 51 tea estates of James Finlay in 1983, to now where it has entered the domain of packaged tea and created brands for different segments of society. Twenty five years ago, Brooke Bond and Lipton held a dominant share of the market, while Tata Tea’s share was less than five percent. Today, TGBL as the market leader holds nearly 20 percent market share in
the Indian domestic packaged tea segment and clocked `1,700 crore revenue last fiscal. Speaking about the complexities at the plantations level, Mr. Tandon says, “As an agricultural produce, it is prey to seasonal whims. Since there is demand for exports also, the quantity of tea available to packeters at the auctions keeps varying based on exporters’ demand and those available for local production. An irregular rainfall will obviously mean a shortfall, which will bring its own complexities in terms of supply.” For TGBL, buying the right tea at the auctions is a critical factor as Mr. Tandon says, “Sourcing is a critical factor. We cannot afford to fall short because that is where our planning, demand forecasting and proactive sourcing methods come in.” Sourcing the right tea is important because of the variety in blends. Every brand has its own unique blend. There’s the fine tea or ‘tea dust’ that is popular in south India, while north and west India prefer the bolder tea-leaves. Even within these, the company
has to purchase tea that goes into making its premium teas Tata Tea Gold, Tetley, Chakra Gold; the mass market – Tata Tea Premium, Kanan Devan, Gemini, and the bottomend Tata Tea Agni.
High Hanging Fruit While it did not take long for TGBL to roll out production of packaged tea, there were certain inherent challenges that the new business brought. One was creating strategies to capture market share of the packaged tea segment where Unilever brands were already well ensconced, and, secondly, offering a fresh look to the kind of tea they wanted in the market so that it didn’t have a me-too kind of f lavor, says Mr. Vyas. As a Tata company, the company had to live up to the Tata brand. It also had its share of category specific challenges. From deciding the kind of tea it would sell to customers, to developing a business model unlike the one prevalent in those times, among other things. What has stood in good stead is the fact that both Mr. Tandon and Mr. Vyas have, over the INDIA |
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