How Much Does A Tea Seller Earn In India?
Tea is not just a drink in India, it is embedded in people’s lifestyle. Selling tea is the primary source of income for innumerable families in India. Tea business market size is more than 500 billion rupees.
The amount that you can earn from Tea depends on type of business. It can range from Rs.15000 to Rs. 400000 per month as per type of business.
Here are some of the different types of tea businesses in India and a rough estimate of how much a person can earn in each sector if done right:
- Tea leaves farmer
- Tea powder manufacturing business owner
- A small tea shop owner
- A big tea shop owner
- General tea seller (restaurants and other businesses)
- Organized Tea seller
Tea Farming in India
Tea is farmed beautifully in India. India does not import much tea leaves and rather is a major exporter of it. Generally, a large tea farm is owned and is maintained by the farmer. However, small tea farms are also owned by several small farmers.
Farmers are responsible for picking the tea leaves (mostly hand-picked) and processing them. The amount that can be earned by farming varies widely depending on produce, quality of the produce, labor costs involved, packaging, etc.
A huge drawback of growing tea leaves is that, if you plant tea leaves for the first time, the produce won’t be available until after 4 years. Hence, assuming 1 hectare of land is used to farm tea leaves, if everything is done properly, a profit of about Rs. 20,000 to Rs. 40,000 per annum can be made after 4th year. Click on this link to know more about tea farming https://www.indiaagronet.com/indiaagronet/horticulture/CONTENTS/tea.htm
Tea Leaves Trading In India
Trading Tea leaves is quite a profitable yet heavily occupied industry. Tea is consumed in every other part of the world and this is not a recent scenario. The Indian tea trade is a very old business. It is always possible to enter such a heavily occupied market when new kind of development is made in the industry (it could be technological or biological).
One can also find any opportunity in any part of the world where there is a demand for tea and yet there is unavailability. A proper distributing partner in that part of the world and overcoming enough regulations, one can become a tea leaf trader.
In general, traders follow a 1% rule i.e., they make a profit of 1% of the goods they trade. Hence, for every Rs. 1 lakh, a trader would earn Rs. 1000.
Tea Leaves Distributors
Tea leaf distributor is responsible for transferring tea leaves from farmer to trader or wholesaler, from farmer to tea powder manufacturer and wholesaler to retailer or store owner.
A tea leaf distributor usually has transport that is capable of transporting packaged or unpacked tea leaves. Any general tea distributor either charges amount for the transportation service or takes from 5% to 40% of the cost of the product he/she distributes.
Tea Powder Manufacturer
Tea-powder manufacturer obtains his/her raw material (tea leaves) from either farmers or agents. The business here is purchasing tea leaves depending on their quality, process the tea leaves and converting them to tea powder, value addition via multiple flavors, medicinal quality infusion, etc, packaging and branding.
However, tea-powder manufacturers may directly sell packed tea powder to wholesalers without any branding. Depending on the quantity and branding of the tea, a manufacturer may have a profit of 25% to 35% on the stock he/she has bought.
Tea Leaf Wholesaler In India
Tea leaf wholesaler buys tea leaves or tea powder either packed or unpacked from a farmer, manufacturer, or any other agent (mostly from the farmer) in bulk quantity and sells smaller quantities to retailers and others (restaurants, etc).
Some of the wholesalers also pack the tea leaves in common measurements. Though most of the wholesalers don’t brand the tea leaves, some of the wholesalers brand the product via value-adding.
Generally, a Tea Leaf wholesaler takes up a margin of 15% to 25% on the product. Hence, for tea leaves worth Rs. 1000, a wholesaler makes Rs.150 to Rs.250.
Tea Powder Retailer In India
A retailer is a person who sells branded or non-branded tea powder and tea leaves to the end customer via small tea-powder shops. Due to the availability of many tea powder brands, branded tea powders have taken over the traditional tea-powder retail and hence this sector is in decline.
However, a well-established store that supplies quality tea powder for regular customers can earn from 20% to 40% of the stock price.
On average, a tea-powder/tea leaf supplier earns up to Rs.50,000 if he or she does business perfectly and has regular buying customers.
Small tea shops In India
Small tea shops are extremely common in India. 50ml to 100ml tea made using tea powder, milk, and sugar has been an elixir for Indians from ages. One can find these shops (generally kiosks) at around every corner of a street in India. These small tea shop owners, though do not earn huge profits, earn enough to have a livelihood in the area.
A successfully run small tea shop can have an income from Rs.15,000 to Rs.30,000 per month. Depending on the area the tea shop is located in, the income can easily be more.
Big Tea shops In India
Big tea shops are a recent scenario. Unlike small tea shops that are generally set-up on kiosks, big tea shops are set-up in a small store giving space for the people to have tea and socialize. These tea shops are not like coffee shops and connect more to local Indian culture.
Apart from selling different types of tea, they also sell small snacks that go well with tea. These shops are seen less often and can only be seen in areas that have a lot of people gathering (centers of any area, near bus stops, railway stations, etc). Though a lot of people means a lot of customers and profits, there is a considerable amount of investment and regular expenditure to be taken care of. Expenditures like company registration, licenses, GST filing, rent, salaries, etc are to be taken care of and are mostly absent in the case of small tea shops.
An average successful big tea shop can earn a profit from Rs.20,000 to Rs.50,000 per month. In some cases where the tea sold is of high quality and every customer’s liking, stores like that tend to earn up to Rs. 1,00,000 per month.
General Tea selling
Tea is also generally sold by restaurants, hotels, and other such businesses for their customers. Though the exact income from these is not known, one can expect that many customers that come to a restaurant or a hotel have a high chance of ordering tea.
Organised Tea-powder Selling
As discussed above in tea manufacturing, big tea brands that have their own tea farms, own manufacturing unit, own distributing network, and retail network generally sell packaged tea powder for way cheaper price. These products can be found in almost every Kirana (retail) shop as well as supermarkets. Brands like Red label, Taj, etc make huge profits and a simple google search can give anyone the net worth and profits of these companies.
In conclusion, If one wants to start a tea business, opening up a big tea store keeping in mind the location can be a profitable business.