Thursday, May 28, 2020

How COVID-19 Is Affecting Tea Vendors

It's a difficult time for everyone during the COVID-19 pandemic, and I've wondered how tea vendors have been faring in this unprecedented environment. I recently published a post about how Chinese Tea Vendors were doing during the pandemic, and I decided to check in with a few tea industry friends, to see how COVID-19 has affected their tea businesses.

I spoke with a few tea vendors and online sellers. I wanted to get a sample of individuals working with brick and mortar tea stores, and also those selling tea online. I had the pleasure of speaking with:

Elena Liao, co-owner of Té Company
Kevin Gascoyne co-owner of Camellia Sinensis.
David Campbell owner of Tillerman Tea
Martin Connelly owner of Little Red Cup Tea Company
Theresa Wong, owner of T-Shop
Ana Dane of In Pursuit of Tea

They gave many observations and insights on how COVID-19 is affecting their tea businesses. Read about the concerns, issues, changes in sales, and surprises they've come across, below.

What are your biggest concerns regarding COVID-19 and your company?

Elena Liao: Our tearoom is closed during the NYC pandemic shutdown. Before the shutdown, the safety of the staff was our biggest concern. Once we closed, it was all about making sure we can stay afloat as the tearoom revenue was our main source of revenue. NYC is also the hardest hit area, so the duration of the closing is expected to be much longer.

Kevin Gascoyne: Due to the timing our first worry was, getting the Spring collection together without selecting the teas in the gardens as we have for the last 26 years. Then, on the home front, how will Camellia Sinensis survive this unknown journey into a new future? 

Government help allowed us to temporarily send 45 of our 62 staff home while we quickly restructured with a skeleton crew.

At the Tea Studio we closed to follow lock-down instructions and sent the workers home with full pay as the Indian Government does not have the resources for such programs.

Wholesale slowed right down with restaurants, hotels and many stores on our client list closing. We kept just one small store open and closed our teahouses, other stores and all school activities.

Our current concern, as deconfinement approaches in increments, is putting it all back together in a new form that suits the new set of market variables. Looking after the staff by gradually re-hiring, as we tentatively test the new waters, with a system that makes sense economically.

David Campbell: I have been fortunate in that shipping channels between Taiwan and the United States have remained open thus far. As a specialist in Taiwanese tea, I would have nothing other to offer were the supply chain interrupted. My biggest concern for Tillerman is maintaining access to my growers and producers.

The other major concern is the cancellation of tea festivals. These are important sales and marketing opportunities for Tillerman and I do not know if I will be able to recoup the lost direct sales with online sales.

Martin Connelly: We are lucky in that we operate our business out of a building adjacent to our home and have no employees, it's just family members. Because of this we've been able to work straight through. Our biggest impact has been canceled trips to China to visit with our growing and processing partners and adding "classroom teacher for our children" to the list of things we do all day. Our biggest concerns are the same as everyone else's, that the world is a scary place right now. We're worried about ourselves and about our friends around the world. It is also especially difficult to make business plans right now in terms of how much tea we should be ordering, and where we should be devoting our limited time.

Theresa Wong: My biggest concern is (and some people has been asking me as well)- is the business going to be okay? And honestly at this point we really don’t know yet. People love our physical tearoom. This is a place where people can slow down and spend some time. They enjoy having tea there, it’s also a place for tea drinkers to meet, to share experiences, and to learn. When the business can open again, we will need to practice social distancing for the safety of everyone, so there will be a period of time we cannot run the tearoom like before. People love our tea events like Tea Making Monday or special tasting session, but we will not have events until we feel safe to do so.

We don’t know how long will it take until everything can go back to normal. Of course sooner is better, but we cannot rush. We need to be extra cautious to protect us, our employee, and customers.

Ana Dane: Staying viable. It's been a truly unprecedented—and completely unforeseen—situation we've all found ourselves in here in NY. No one could have dreamed the entire hospitality industry would evaporate in 48 hours, but that's pretty much what happened. And it looks like it's going to be a bit more time before restaurants and hotels are back up and running here. As that market has been the bulk of our business for over twenty years, it's been a challenge to navigate.

Obtaining 2020 spring harvest has also been difficult. For the most part, the tea is being made at origin, it's just that the breakdown of the supply chain and logistics of getting it over the U.S. is still a huge obstacle. However, we are expecting a few lots of Darjeeling 1st Flush (finally) in the next few days, so keep your fingers crossed!

If you have a brick and mortar shop, how long has it been closed? For online, have you seen any changes in your online sales?

Elena: We have been closed since the middle of March. Yes we have seen very positive online sales. Many of our guests, some live 2 blocks away, are now purchasing our teas and cookies online! We are lucky to have such wonderful customers who are incredibly supportive of us.

Kevin: Naturally a large amount of retail switched to web sales which initially saw a heavy increase in traffic. The small store that remained opened also saw an increase in sales. The company however saw a reduction in overall sales eased slightly by the reduction in salary expenditure. 

David: No, my year to date sales have increased over last year by exactly $2.44. Fulfilling orders has been a challenge given that I am not at home during this crisis.

Martin: Our internet sales have been quite steady. Our sales to restaurants, cafes, and stores are down considerably.

Ana: In terms of our customer base, no more restaurants, of course, but a lot more retail sales—folks are at home, and perhaps some are for the first time incorporating tea into their daily routine or learning how to prepare it themselves. What types of tea people are buying hasn't shifted all that much, it's a healthy mix of the crowd pleasers (Assam, Earl Grey, Genmaicha, matcha) and some of the smaller lot, more limited or unusual picks (Thunder Dragon Green, Taiwanese high mountain oolongs).

Have you heard any feedback from your customers regarding the coronavirus and buying tea?

Kevin: In the one small trusty store that remained open clients were so relieved to find us open as an essential food product but also as a small beacon of normality.

Martin: Really early on we had customers expressing support for Chinese products as a small anti-racist action. Beyond that we've been hearing more from customers who are used to shopping in stores. Some of them are buying tea online for the first time.

Has there been any surprising positive or negative effects to your business during this time?
Elena: I think people have been doing a lot more teatime at home to break up the day, which is great! We also get overwhelming amounts of love notes from our customers asking about our health and safety which was so kind. We are very thankful!

Kevin: We felt that having the diversity of sales channels, retail-wholesale-internet etc, allowed us to move our clients from one form of purchase to another to suit their new needs and situation. It will continue to be an advantage as we move forward. Once the restaurants and other stores open and a new normality is established we will have more of an idea as to how the overall picture has changed for us.

David: All of my business is done online so I am insulated from the effects that those who have brick and mortar must be facing. For me it has been very much “business as usual.” That will change, of course, once the festival season begins.

Martin: We often get nice notes from customers, but I think the number of notes is up. People are appreciative of both our service and our comforting products.

Theresa: Surprising but not so surprised, some people have spent more time on tea at home. Tea drinkers have virtual tea gatherings. Tea sales have gone up due to higher consumption.

The negative effects are more on the supply and sourcing side. The supply becomes a little unstable due to the issues with shipment. Earlier last month I had a farmer did not want to sent me tea because shipping takes much longer time and higher risk of missing. A couple of my shipments from other farmers took longer time to arrive. On the sourcing side, we usually do our annual tea trip in spring or Fall. This year I was planning for the tea trip in Fall, I still don’t feel comfortable about traveling, so I might have to cancel that for safety reason. The tea trip is when we can develop relationships and have better communication with the new sources.

Ana: Let's just focus on the's not the most exciting aspect, but operationally this has been a complete gift, in one way: we've all had to so severely curtail normal operations that it offers a chance to examine what has or hasn't been working in your business. Like with any small business, the days are normally so hectic that time rushes by and large-scale or foundational changes to how your company functions are very difficult to implement. We have the opportunity now to examine what we can do better: how can we support more tea farmers by getting their incredible harvests into the hands of more tea drinkers? How can we improve our offerings, our packaging, our educational tools?

Each tea company has been affected by the pandemic in different ways, but everyone noted tea drinkers are buying tea online as much as, or more than before. We are also finding new and creative ways to share tea together during this crazy time. Thank you to everyone that took the time out to answer my questions. I know it isn't easy to find the time and focus, and I'm so glad I can share all of these important tea insights with everyone.

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