Two brothers from Brisbane earn $3 million a year after a rocky start in a bid to shake up that common commodity.
Two Brisbane brothers have struck a deal with Woolworths and Coles in the hopes they’ll turn an everyday item from boring to ‘cool’.
Chris and Lawrence Seaton started their Origin Tea business nine years ago when their father owned a tea plantation in Sri Lanka.
Origin Tea’s Australian operation, which started in their garage, now brings in $3 million in annual revenue, but it hasn’t always been easy for the siblings.
“When we first launched in Australia, we wanted to go after the big brands like Liptons and all those name brands and we actually learned the hard way that all of those companies had big marketing budgets and were spending millions per year in marketing,” said Chris. news.com.au.
“And tea is one of those products that people are really brand loyal to, so the first two years we made a pretty big mistake and had to change our whole business strategy.”
This included bringing in an entire container of tea with hundreds of tea bags in boxes that they couldn’t sell. Instead, they had to liquidate it through customs clearance warehouses, which cost them $200,000.
“At one point I was trying to sell packs of tea in the markets for $1.50 or $2 with a hundred in the box and at the end of the day I was collecting $100 in cash from the markets and I was like I didn’t think it was really worth it,” Chris added.
Then, as the popularity of single-origin coffee began to take off, the duo realized this was an opportunity to take tea to that level by providing transparency into what people were drinking.
They have also started partnering with coffee roasters, building brand recognition in Australian cafes.
It has also helped them become what they say is the fastest growing consumer tea company in Australia, thanks to partnerships with companies like Coca Cola and Campos, while profiting from the kombucha boom of 2016-17.
The tea was the basis for the original Remedy kombucha brew which grew to a million dollar deal within a year, then doubled as the business grew from 20kg to 150,000kg almost overnight .
Chris said a lot of people aren’t aware that there is a huge difference between how tea is made.
It also starts early with hand-picked Sri Lankan tea depending on the maturity of the leaf, rather than machine-harvested tea from Vietnam, India or even Australia where the heads of the tea bushes are just cut,” Chris explained.
People often mix tea from different countries together to reduce the overall price, but Chris said this also has an impact on taste.
“Sri Lanka is renowned around the world for having the best quality of tea from a taste point of view, but it comes with a premium,” he said.
“When we talk about taste in tea, it’s like a good liquor, like a good whiskey or a good wine.”
The company now consumes up to 200,000kg of tea a year, which could increase further with the deal with major supermarkets, which will see the product sold in up to 700 stores nationwide.
The deal also helped Origin Tea bounce back after 70% of its business was wiped out overnight when the pandemic hit, Chris said.
Woolworths and Coles will offer its Sticky Chai range, which is a tea blended with infused spices in coconut sweetener, and will retail for $9 for 120g, alongside a range of turmeric elixirs.
Both hope the new products will shake up the outdated category.
“I think traditional tea is on the decline, so black and green teas, and where we play and where we like to see each other, are the innovators in the tea space. Our core mission with Origin Tea is to bring freshness back to tea,” Chris said.
“Tea is seen as a stagnant category and the Sticky Chai product is something innovative, infusing tea with other ingredients or to come up with awesome iced tea that’s ready to drink and concentrates like syrups so you you can top it with alcohol or make your own cocktails or mocktails.
“This is where we see tea playing in the future as being creative with tea.”
The brothers, aged 31 and 27, have just launched in America and dream of becoming a global tea house.
There’s also the goal of generating $5 million in revenue next year.
They predict a takeoff in tea’s popularity due to rising coffee prices and the rise of tea products such as bubble tea, iced tea, kombucha and seltzer tea.