Just what I am talking about at the World Tea Expo New Business Boot Camp?

People always laugh when I try to describe my contribution to the World Tea Expo's New Business Boot Camp. Technology and Tea - could we have selected a set of more diametrically opposite topics?!!

As I mention in my introductory remarks, my background is in biotechnology and I used to live in Silicon Valley. Technology is in my blood, whether I like it or not. Actually, I'm very adamant about using only what you need.

For a retail tea shop or online tea business, this might mean one or more of the following:

• Point of Sale system (a computer) or basic cash register (dedicated cash register)
• Accounting system
• E-commerce domain, hosting, and cart
• Merchant account
• Electronic postage
• Digital camera and photo editing software
• Gift and loyalty cards
• Security cameras and digital recording systems
• Wireless hotspot
• Social networking strategy
• Data security plan
• Scorecards

Mostly, we look for ways to optimize and automate what we do. This means finding ways to simply management tasks so you can focus on what's really important in your business.

The above lists are just some of the tools we've implemented. The end result is we know what we've done, what we're doing, and where we're going. I remember one of my old employers had a high paid consulting team come in and tell us the core of what they try to discover is simply "what's working" and "what's not working".

Getting the most out of your visit to the World Tea Expo

We have been attending the World Tea Expo (WTE) in Las Vegas since its first inception as the Take Me to Tea conference. The event is always well attended and if you're still on the fence in terms of deciding whether to go or not, I would certainly encourage you to go.

So what makes the WTE so attractive? Believe it or not, I would have to say its organizers. George and Kim Jage and the team at SFG Group, LLC are really dedicated to making a good experience for all. Sure they try a few ideas that don't work so well, but you can easily tell they truly want everyone to walk away thinking they will attend next year, too. I've attended similar coffee shows where they just randomly throw up a bunch of speakers and open an exhibit hall to vendors. On the contrary, the organizers of the World Tea Expo are always trying to keep you engaged, offering lots of activities and sidebar type opportunities.

While the World Tea Expo has been conducted for probably near 7 years now, it's much more than a "seen that" "done that" experience. The format of education and exhibits and cultural demonstrations and workshops offers a nice balance between the pure fact finding about tea and the practical world of how we can all share our love for this healthy, simple beverage.

The event is scheduled for June 11-13 at the Las Vegas Convention Center with a New Business Boot Camp (where I am an instructor) offered immediately before and the Specialty Tea Institute certification courses offered immediately after. It will certainly be a long show if you run the whole span, but I've know people to have done it!

To get the most from the World Tea Expo, here are my list of top recommendations (not in any particular order):

1. Network, network, network. Bring your business cards and get to know as many people in the industry as possible. Whether you are just starting out or have been in the business for awhile, you quickly realize there aren't too many formats that allow us to meet face to face. Certainly, once you've opened your tea room it becomes even harder to break away for several days in a row. I recommend you take the time now to make at several hundred business cards and try to make it a point to hand them all out! Of course, a business relationship is more than exchanging business cards, but at the very least, you don't want to run out of cards at the show.

2. Sign up for courses that best suit your needs. The seminars in the morning run concurrently, so you will need to find the classes that best match your interests. If this is a repeat visit for you at the WTE, don't feel as if you have to revisit a class that you've taken before just to see if there's anything new. Chances are you'd be better served attending a class that's completely a new experience. For me, I think many new ideas are sparked by the unexpected. Putting yourself if a new, unexplored situation is the best way to feed the creative fire.

3. Manage your exhibit time. The exhibit floor is generally buzzing every minute of the show. Last year as an exhibitor, we were constantly swamped with so many show attendees that we hardly had time to take a break, let alone see the other events scheduled throughout the afternoon. This year we're a little smarter and will have additional staff at the show. If you're attending, you should have ample time to visit all the exhibit booths without a problem. You shouldn't feel rushed at all, especially if you're going to be there all three days.

On the other hand, if you're only going to be at the show for a single day, I would certainly encourage you to visit the exhibits for the entire time it's open. Manage your time wisely and know that if you're planning on attending a guided tasting or afternoon cultural demonstration, this is time you will not be on the exhibit floor.

4. Taste a few teas, but know it's the relationship that counts. Many of the exhibitors will offer a few teas to sample. While this can give you an idea of a new tea that they are introducing, don't take it as an indication of whether you will work with that vendor or not. For each vendor offering tea, there are probably about 100 or more teas that aren't being offered for sampling. Furthermore, will you really be able to make a decision about tea quality when you're sampling out of a small paper or plastic cup, standing in a loud conference hall while holding a bag of conference materials over your shoulder? No, it's much better to select a few vendors to work with and get a catalog or website to examine when you get home.

4a. Establish a relationship with your vendors. We have owned our own retail storefront for over 6 years now. We used to see the World Tea Expo in terms of a buyer. Now we see the World Tea Expo in terms of both a buyer and seller. Since overall there are fewer sellers than buyers, let me share a secret with you. Vendors can often be your source for much more than providing product. Since they work with so many independent retailers, they can also be a source of guidance on which teas might work best in your environment. If they have direct retail experience, they will also know much more about the hurdles you will need to overcome in a retail environment - anything from business plan, to staff management, to product margins. While you don't want to use the time at the show to pound vendors for information, it's an ideal time to quickly describe your business and what makes it unique. The vendor will appreciate and remember your individual story and be able to note that for future interactions after you get home.

As a wholesaler, we often receive inquiries from start-up business owners, but if a start-up entrepreneur has taken the time to introduce themselves at the show, to share their vision and a little of their personality, it goes a long way in terms of understanding timeframe, range of teas, typical client demographics, seasonality and much more.

5. Consider attending the pre show New Business Boot Camp and the STI Certification Classes. I lump these together, but they are really quite different animals. The bootcamp is designed more for the fundamentals of setting up your own storefront. The STI Certifcation Classes are dedicated to educating you in the appreciation of a specific set of teas. Both are quite valuable. If you have never attended an STI class, you will probably wish you had a chance to attend even before the exhibition had started. Both pre and post courses are very practically oriented, loaded with lots of tips and hints you will be able to immediately bring back with you once you get home and your head stops spinning. By all means, consider the STI Certification class if there is not a class offered in your region some other time throughout the year. The time and cost you'll save by not having to travel to another location will be well worth it. FYI, the Boot Camp is only offered once a year.

6. Consider scheduling meetings at the conference. Let's say there is an open slot in the morning that's not taken up by a class or perhaps you will want time to sit down some time throughout the busy exhibition schedule. Why not set up a time to meet with someone you'd like to have some face-to-face time with? Perhaps it's someone you've just met at the show, or even a vendor who you'd like to discuss some specialized blending or packaging project with. Chances are they'd be more than happy to meet with you, especially when they're going to be giving you their complete attention and not looking to help a new client who's been waiting patiently at the booth for 5 minutes.

7. Practice your 15 second elevator speech. You know the story. What would you say to a rich investor if you bumped into them in an elevator? Practice this script so it will aid you in transmitting your vision and act as a base for discovering who you will be able to partner with after the show. "I'm starting a tea shop." while possibly accurate and succinct isn't going to get the same reaction as "We're launching a new, retail and online resource for the world's freshest organic teas, SensitiviTea. SensitiviTea be sold across the country and will include home recipes for adding seasonal fresh fruit and flowers to freshly brewed tea." What you're doing is getting others excited by your idea, leading them to want to help you be successful. What about divulging too much? Believe me, if your idea is that easy to copy, you probably won't last long in a competitive environment where some parties will have much deeper investment resources than you. Who knows, maybe your idea is unique enough to attract investors at the show - wouldn't that be great?!

8. Be prepared to blog/facebook/twitter about your experience. Nothing can be more viral than the net. Your enthusiasm, your new venture, your overall impressions at the World Tea Expo, when shared with others who participate in your success, can only help fuel your expertise and dedication to the field. Let's face it, no one really cares if you're the type of person who bounces from one interest to another without really accomplishing anything. For many of us, tea is a life long journey. Whether we stay in the field professionally or not, we will always be loyal to the leaf and the many facets of its appeal.

9. Consider all contacts valuable. Maybe this comment has more to do with how you manage your contact information when you get home, but take note of the fact that the industry is always bigger than you are. Today you may have specific needs to launch your business. Next year you may stumble upon a big corporate client who wants to use your brand to make tea bags in every national health food store across the country. How could you do that? Would you have the connections to pull this off? Or did you just shop for new tea blends, tea cups, and novel infusers for 6 hours?

10. Give back. My last recommendation is to take a few moments to contemplate how you can give back to the tea community. Whether it's a donation of tea, or hosting a few tea seminars, or even becoming a featured speaker at next year's World Tea Expo, it's a great feeling to help those who were in your position a year or two from now. That's why I'm speaking at the Expo. That's why we're exhibiting. That's why I'm so interested in helping you. This industry has always been so supportive - everyone wants you to do well.

11. I leave #11, 12, 13 and on to you. Share you ideas on our blog or consider cooperatively linking with us at Kopius Teas (kopiusteas.blogspot.com).

Ron

Food Labeling Guide

Ever wonder what's actually required on the outside of package of food sold in the US? The best resource is to check out the FDA's website on labeling and nutrition. Some text is in the form of requirements, other text is in the form of guidelines. A lot of the thinking for such "rules" is food safety and consumer protection. By having a more accurate description of the product, consumers are able to shop with greater confidence, particularly when comparison shopping. It's funny how marketers are smart to capture your focus and attention with colors, fonts, graphics and more. Whatever the design, the final product label should be consistent with the above regulations and guidelines for food labeling.

Within the FDA's site is a section Food Labeling Guide. I think the biggest mistake people make for packaging tea is probably not knowing about the very basics - General Food Labeling Requirements. That is, people forget the simple things such as ingredients, weight, manufacturer name & address. Note that the labeling requirements are specific when defining placement of this information on a food label.

Another good section to keep in mind is the food allergens statement. See the FDA's Guidance for Industry: Questions and Answers.

Lastly, if you're going to be selling your product internationally, be sure to review labeling requirements of these other countries. For example, certain parts of your statements may need to appear in more than one language.

With a bit of planning, you can save yourself the headache of having to reprint labels or canisters. You know the labeling game...the first several thousand cost per label is extremely high and then it ramps down quite quickly with quantity.

The more standardized the labels, even across food categories, the easier it will be for consumers to quickly locate the information that is relevant to their purchasing decision, whether it is for health or curiosity reasons.

Top Tools We Rely on for Our Wholesale, Retail, and E-commerce Businesses

As many of you may know, we manage a series of wholesale, retail and e-commerce stores all focused on tea. We would not be up to do this effectively (with minimal payroll expenses) without the use of computers and related technologies. It is odd to find myself drawn to technology when in actuality my main motivation to move into the tea sector was to escape high technology.

But my affinity for technological solutions is really geared at finding practical solutions for the problem at hand. I know this to be the case because one need only look at my cell phone, which by the way does not have any smartphone features, to know that I don't just buy technology for the sake of having it. Even my MP3 player still uses a standard rechargeable AA battery.

Having said that, here a list of essential tools that I would consider now to be indispensable.

1. Volusion. Volusion (www.volusion.com)  is our core e-commerce platform which includes web hosting, website design, and shopping cart functions. Volusion represents our third cycle of e-commerce platforms. The first was Microsoft bCentral, which was promptly dropped by Microsoft several years ago. The second was eBay's ProStore, which was more or less a template design nightmare. Volusion's  interface, customization capabilities, and total breath of functions has really been a blessing for our small business. Add on top of that true 24/7 customer support and you have a solution that is really built for around-the-clock maintenance and upgrades.

I know if you read some of the forums within Volusion, you will find a series of disgruntled clients. But overall I believe if you are truly focused on business and not a software developer at heart, you will quickly come to realize how this one tool can open up your imagination for marketing new products on the Internet.

Another subset of technologies we've come to rely on through our use of Volusion is SQL. I'm definitely not a computer programmer by any means, but learning a few stored queries (SELECT queries) has really helped harness the power of this system. By stored queries, I mean a routine way of pulling relevant data from a relational database. For example, we have stored queries we use to transfer data between the e-commerce system and our Sales/MRP system. This might include customer shipping address, item codes, prices, quantities, etc. We also use stored queries to view purchasing data and manage product pricing and descriptions. We can pull customer data automatically for creation of our product sample labels. We even have stored queries to grab data related to customer returns and feed it directly into excel and word.

Lastly, we use Volusion's implementation of Intuit's web connections to link this system with Quickbooks. In short, it automatically creates an itemized sales receipt for every transaction. By some standards, this is low tech. For us, it's just cool. Who wants to enter all this data manually?

I will continue with this list in future postings shortly.

Manufacturing Your Own Brand of Certified Organic Teas

Organic production is a system that is managed in accordance with the Organic Foods Production Act (OFPA) of 1990 and regulations in Title 7, Part 205 of the Code of Federal Regulations to respond to site-specific conditions by integrating cultural, biological, and mechanical practices that foster cycling of resources, promote ecological balance, and conserve biodiversity. The National Organic Program (NOP) develops, implements, and administers national production, handling, and labeling standards.

Clients call us every day to ask how they can have their own brand of teas packaged with the USDA Organic Seal on the outside. The first thing I mention is that use of the Organic Seal is not only an indication of a product that was grown organically, but that the product has continued to be handled and processed through the supply chain in accordance with CFR Title 7, Part 205.

To ensure compliance, wholesalers, distributors, and retailers will contract with a certifying agent who will conduct the necessary reviews, inspections and reports. If you intend to physically handle organic products and marketing them with the USDA Seal, I strongly suggest you speak with a consultant who can help you prepare an Organic System Plan. Consultants in this area can also help you plan and allocate resources, as the responsibility for compliance continues without interruption throughout the year.

A faster, more streamlined approach to offering certified organic products is to establish a contract with a packer, sometimes referred to as a co-packer, that already participates in the National Organic Program. They will be very familiar with organic standards, can facilitate filing of required documents, and will physically pack your tea into retail ready boxes, canisters, and foils. In a nutshell, the process is simpler because in the end you are handling the finished goods just like a retail shopper. Should you choose this route, do your homework and make sure the packer you choose is currently in good standing with the National Organic Program and that their license has not been surrendered, suspended, or revoked.

Still interested? Here are some good reference materials to start with:

Organic Products and Labeling

Organic Processors, Handlers & Distributors (courtesy of Oregon Tilth)

List of Domestic Approved Accredited Agents 

If you are looking to market your organic products internationally, your packaging will need to adhere to the requirements (including written language) of these other countries.

List of Foreign Accredited Agents

Your local state may also have their own State Organic Program (SOP) which you should research in addition to the above.

Lastly, it is possible through your review of the above regulations to think this is your only responsibility in terms of package labeling. Of course, this is not the case. More on this next time...

Ron

Curtis Tea Brewers

 

We had a nice tour of the Wilbur Curtis Company in Los Angeles, CA. Curtis manufactures a complete line of quick service to restaurant to large scale hospitality hot water, coffee and tea brewers. I was surprised to learn they produce so many different models from the same facility. Particularly impressive was the manufacturing process engineering and quality control. Modular, efficient, clean, well organized, synchronized. This would make an informative tour for any university or post graduate program studying lean, six sigma, kaisen, scorecard methodologies.

Of course, we were there to view the iced tea and hot tea brewers. There are many models to choose from, depending upon throughput and desired quality/price of the end product. Most consumers would be amazed by degree of engineering, chemistry, and overall product development required to design and produce each product. I would almost consider these brewers more of "a fine tuned instrument" that a generic "brewer".

The large scale coffee brewer (and variations not shown) was designed more than 50 years ago. I love the rounded corners on this design - really classic! The fact that Curtis kept this stainless steel design is a testament to not muck with a good thing. I get tired of looking at the latest, bright colored, vibrant kitchen appliances coming out for the home market today. In a commercial kitchen, rounded stainless, functional is the way to go.

We wish the team at Wilbur Curtis all the best and thanked them graciously for their hospitality.

Price Adjustsments - Good News?

Our prices have changed - effective about 1:30am (yes, it was a late night). Volume discounts have been improved dramatically. Previously, our highest discount rate was 12%. We have now boosted this to 25% for case quantities.You can even order in increments above the case quantities and still enjoy the fully discounted price per pound.

As many of you know, most of our blends are available in your choice of conventional or organic ingredients. We noticed that our front page was defaulting to show the price of the organic version. This has been changed to show the conventional price. This makes it easier to view how the organic version adds a premium, as opposed to the conventional version providing a discount.

Scalability from your tea suppliers

We see many specialty tea retailers offering wholesale programs. I think this can be particularly exciting, if you can identify a retailer who is importing their own, carefully selected teas. The buyer should know the teas intimately and if they are buying a garden that they have dealt with previously, they will also be aware of the seasonality and how comparable this season's crop is to last year's.

One of the challenging of getting started in wholesale as a supplier or establishing a relationship with a new tea suppler is scalability. As an importer, there is always the risk of buying at too high of a price or in too great a quantity. Alternatively, we experience regret when we find a great buy at a discount price and then can't supply enough product to meet demand. This latter case speaks to scalability and how flexible your current supplier is in handling orders across a broad range of buy sizes.

Take for example the Championship Teas at the World Tea Expo. Once we have an award winning tea or series of teas, the demand immediately escalates. Similarly, once an astute, large scale buyer finds a perceived undervalued tea, they may wish to buy out our entire lot with a single purchase order.

We constantly reassess our buying patterns to minimize in price and supply for our clients. Nevertheless, it should be noted that we are in a truly unique position of wholesaling and distributing conventional and organic tea products for a wide range of clients - everything from 2 lbs to thousands of pounds. Our buying is often made one to four months in advance of the receiving date.

I have a particular interest in business analytics. Certainly we have collected sufficient data on the above to begin modeling and managing inventory more efficiently. Perhaps this can be a good project for 2010.

Retail Discount Pricing

We manage both a retail tea shop and wholesale tea distribution business. In both ventures, we find continual challenges in analyzing sales data to identify price sensitivities and appropriate price points. This holiday season, in particular, brings with it a very astute, savvy consumer who wishes to confirm value above ultra-premium, short term sparkle.

Tea is in a unique position as a consumable. No matter the cost, it will be consumed over time, with a very moderate per cup price. What helps establish a higher price point is a shared appreciation between the buyer and seller - an appreciation of both what makes a tea special on paper and how it cups over time. While the buyer will only keep a few essential facts in mind when enjoying a tea, it is really the repeat, reaffirming cups that will keep the buyer loyal. And frankly speaking, loyalty to a seller's brand or reputation is what offers greater variability in discretionary pricing.

When we do guided cuppings in our store, we always have the goal of giving the customer a positive enough experience that they will return. We try our best to build loyalty over the long term. That loyalty is personal and long lasting - we believe it is much more forgiving than the disappointment from purchasing a "grocery branded" off product.

So in our desire to offer 10%, 20% or even greater discounts to bring customers in the door, we will do that by demonstrating our compassion for our clients and our commitment to serving our tea community in the long term. The greatest challenge now facing a retailer is knowing this has been a difficult sales year and yet looking primarily at discounts as a core motivator for the consumer to act now.

The day after Thanksgiving is really about the big box retailer. What small business retailer would want to open at 4am anyways?!!! Nevertheless, we do share in the trying times with our clients and we are kicking off this holiday season with broad based discount programs at both Infusions of Tea and Kopius Teas. We hope our clients will take advantage of this sales opportunity, as wholesale prices will most definitely increase early 2010. 

We wish everyone a joyful and loving Thanksgiving. For us, we are most grateful for the single day off we will have before Christmas!

Case Quantities of Teas

If you've viewed our warehouse video, you may have noticed our teas most often arrive on pallets. These pallets contain multiple cases (or chests). When you purchase in quantities less than 50 lbs, you are often purchasing in less than case sizes. Essentially we break the case open to weigh the amount of product required to complete an order.

Kopius Teas is now expanding its operations to handle the sale of intact case quantities. Intact cases are easier to redistribute and customers enjoy considerable discounts over our sub-case pricing. Please contact us for more information or a quotation.

To facilitate ordering, you will find the case quantity of our wholesale teas and tisanes listed on the individual product page's "case size" tab (found underneath the product photo).

Conversation with Manik Jayakumar, Qtrade Teas & Herbs

You can listen to an archived recording of a recent interview with Manik Jayakumar, President, Qtrade Teas  & Herbs. The broadcast is featured on our internet talk radio channel, TeaCast.

Many of us buy and sell organic, fair trade, and biodynamic products, but we don't always have an opportunity to see or understand its impact on the actual tea gardens. Manik discusses changes on the tea plantation when they convert from conventional to organic farming methods. In addition, he notes the range of activities and products that Qtrade Teas & Herbs now performs. We think this is a unique opportunity to feature one of the true pioneers in the specialty tea industry.

Kopius Teas is a distributor for Qtrade. We have streamlined the ordering process to allow small to mid-tier companies to purchase from Qtrade's extensive range of conventional and organic teas, herbs, spices, fruit, and flowers.

CoffeeFest 2009 presentation on analytics

Ronald Eng will be presenting at the CoffeeFest Seattle on Friday, September 25, 2009 at 10am. The presentation will focus on the use of analytical methods, including scorecards and dashboards, to improve menu selection and profitability.

Premise: As a small business owner, how do we make informed business decisions when time and information are at a premium? What performance parameters are important to track and how can this information be summarized for rapid assimilation and management oversight?

Methods: Come to the talk for details!

Conclusions: Point of Sale systems are excellent instruments for data collection. This transactional information, when used in conjunction with financial statements, combine to provide an ongoing, visual monitoring of your business, both its recent history and projected future.

Restaurant Demand for Specialty Wholesale Bulk Tea

When speaking with friends or even business associates, we are frequently asked who our customers are at Kopius Teas. Mostly we explain the retail tea merchants, coffee roasters, coffee shops, restaurants, Internet-based tea distributors, and specialty applications where tea is packaged and used as a branding tool.

The one area I'd like to address today is restaurants. The restaurant use of specialty loose tea or tea bags can be a little bit more challenging than the other sectors listed previously. The main reason for this is because tea is one of many products that are prepared and served in a typical restaurant. While nearly all culinary professionals would agree that loose leaf tea steeped properly results in a beverage far superior to teabag tea, they're certainly an added hurdle of training and logistics required to ensure the proper amount of tea temperature of water and time of steep are optimized for the restaurant patron. Add to this the fact that the turnover rate in restaurants is typically higher, and you can see why many restaurant owners and operators favor teabags to loose tea.

Over the past 10 years the emergence of pure see-through teabags containing larger leaf teas and herbal tisanes has brought greater awareness to the premium nature of a whole leaf product. Mighty Leaf, Revolution, Two Leaves and a Bud, and many other provide viable, quality options for restaurant use. Furthermore, these products are individually wrapped, attractive, and enjoy strong, brand recognition.

On the other hand, if a restaurant is interested in building its own brand, representing natural, unique, novel concepts and dining experiences, then they might consider putting the effort into serving whole loose tea at their establishments. And if restaurant management decides to pursue this leve of quality, I would certainly encourage them to develop their own custom blends and offer them as private label, branded teas. Tea is associated with health, rejevenation, and a soulful meditative state of well being. The products store well and can be packaged to desired specifications. Compared with t-shirts, mugs, and other branded products, I would suggest that specialty tea when brought home or share with others, can help enforce the values of a restaurant's target dining experience.

Thinking about a Web Based, Tea Business?

We speak with people every day who want to get into the business of tea. Most are interested in starting a web business. Certainly, we experience the full range of "I need it now" to "I'm just looking", but whether your are well versed in aged pu-erh or the finest high mountain Tie Kwan Yin, to me, the greatest indicator of web success is your ability to translate your passion for tea into an indexed language that the search engines will find and rank highly. Those in the know just refer to this as SEO.

As much a building a knowledge of tea, I strongly encourage nearly all the new web-based, tea entrepreneurs to have a clear strategy for how they intend to build traffic. A pretty website and unique products isn't enough. It's like a small emerging fern in a vast forest of giant redwood trees - you just won't get noticed.

Having said that, I hope those of you who've built a successful web presence will share your ideas. The tea industry has always been very supportive and encouraging, with the exception of one large tea retail franchise beginning with the letter, "T".