October 2012

As we move into the fall season, it seems like an opportune time to discuss the state of the business in warm beverages, especially coffee and tea. I would like to take this moment to reintroduce Laura Everage, who contributed to this edition, and welcome her to our experienced team of editors. Many of you may already know Laura as she has spent many years covering coffee, tea and other specialty beverage categories. She will be creating a new Gourmet Business specialty beverage publication that will debut in 2013. So, if you can’t get enough of her great writing in this issue, you will soon be treated to a regular discussion of what is happening in the beverage space.

I grew up in a household where loose-leaf teas were commonplace, and the preferred morning beverage was Earl Grey with honey from our own hives in the back field. This was long before we had retail store chains dedicated to the category, and our collection of Twinings teas were about as good as you could get. This business has certainly progressed!  

Tea can now be found in almost 80 percent of all U.S. households. On any given day, about one-half of the American population drinks a serving of tea, with the biggest concentration of tea drinkers in the South and Northeast. As of 2010, the research showed that 65 percent of tea brewed in the United States was prepared using tea bags. The biggest surprise for me was that 85 percent of tea consumed in America is served iced. You have to consider that tea consumption includes ready-to-drink and iced tea mixes, so all of the tea consumed is not being prepared. Still, the market for loose-leaf tea is rapidly gaining, and the specialty products for brewing have become more sophisticated. I guess I can see why suppliers like Takeya have put a lot of effort recently into creating products for brewing fine iced tea at home.

As much as I enjoy tea during the day, I must admit that my first drink of the day must be coffee. I have gradually extended my coffee taste, from a professed Starbucks groupie to a follower of a variety of specialty roasters that feature outstanding single-origin beans sourced using fair trade practices and roasted to perfection. Ever since Starbucks consolidated its coffee bean selection, I found myself looking for more variety, and realized to my delight that there are a lot of great options. I have a feeling I am not alone, and there is a gap in coffee that will help some of the regional specialty producers gain more nationwide distribution.

To cut a long story short, we believe that the coffee, tea and specialty beverage business is a great category that can be successfully retailed by all channels of trade. We encourage you to realize the strength of the demand that makes this an interesting business opportunity right now, and understand why it may warrant an investment in the category that goes beyond the basics. We hope you take a moment to learn about all of the great products that are available in the marketplace, many of which can be found in this issue, and envision how they can be brought together to make a great statement.