Chinese friend wants to know: how realistic is it to start a Western-facing online tea store?
A Chinese buddy and I were discussing his idea to start a western-facing tea store based here in mainland China. Personally, I think it’d be really hard to compete with the prices of Yunnan Sourcing (which are often so cheap I can’t really understand where Scott makes a profit) or the brand recognition of the giants that most average American consumers would buy from.
What are your guys’ thoughts?
I think the only way you could make it is to specialize and sell directly from farmers (including their stories, Verdant style). That or somehow go for a wide variety and try to get prices like Scott gets. The thing is that would require buying in such bulk that you’re guaranteed to lose money on spoiled inventory in the first few years. Maybe quite a lot.
Last I checked, puer doesn’t exactly spoil when you don’t sell it in the first few years.
This friend is from Xiamen (Fujian) and is much more experienced with teas from that region, not pu’er. It’s not like he couldn’t learn but he also doesn’t have tons of connections in Yunnan or anything.
He should stick to what he knows and focus on quality teas from Fujian. He’d have to have better price/quality than the competition, though, or it’d probably be an exercise in failure.
Most of the Western facing stores focus on Puerh Tea. I don’t know of any that focus on Fujian teas. It may be that no one is occupying this niche in the market.
Yunnansourcing sells a fair bit of Wuyicha and at quite reasonable prices. Some people are very happy with their quality and others feel it doesn’t meet their needs.
JKTeashop is a good one too and very popular. I don’t buy Wuyicha online, but there are quite a few shops that are popular with overseas buyers. You’d have to try their teas to know how good they were!
More info:
Has he done a SWOT analysis? that will answer most of his questions. https://www.mindtools.com/pages/article/newTMC_05.htm
http://pestleanalysis.com/how-to-do-a-swot-analysis/
If he can develop strong relationships with farmers who can produce a lot of tea, or a variety of teas, it might be a great competitive advantage
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