Need more Indian brands selling local tea globally: VAHDAM CEO Bala Sarda

Citing how foreign brands are taking advantage of the opportunity from the sale of tea grown in India, VAHDAM CEO Bala Sarda said on the occasion of International Tea Day that it was time for India to move beyond sourcing and start selling its world-class tea under more home-grown labels.

It’s sad that there are more “European brands selling Darjeeling tea and American brands selling Darjeeling tea,” said Sarda, whose homegrown tea company has been a global hit with Hollywood personalities – including the likes of Oprah Winfrey, Ellen DeGeneres and Mariah Carey – endorsing the brand’s exotic tea blends. Which sell tea to the world more than Indian brands.

“I think we as consumers always trust authentic products. For example, wines from France and whiskeys from Scotland. But for some reason, European brands sell more Darjeeling tea, and American brands sell more chai tea than any remotely Indian brand does.

“For India to be recognized as a trusted country, a great power we need global brands to come out of India… I think it is just about taking Indian tea through an Indian brand and you know, convincing consumers,” Sarda told PTI.

For the unprofessional, India is the world’s second largest producer and consumer of tea – accounting for approximately 25-28 percent of the world’s tea production. It also accounts for about 10-12 percent of world tea exports.

According to Sarda, India, which supposedly leads the multi-billion dollar global tea market, due to the lack of local brands for the longest time has been exporting tea as a “commodity” with “single-digit margins” in favor of foreign companies. Importers – who package them nicely later and sell them at ‘multiple X margins’.

However, with the advent of VAHDAM and more of these brands, the same value that once went to a foreign land is now being held in India only.

“You know the average export price of tea is no more than four and a half dollars a kilogram. We at VAHDAM sell consumers several times higher price points per kilogram. Not that consumers didn’t pay for it anyway. Just the only thing different because of the brand A business like ours is that value was held in India, as opposed to that value which was spread in a foreign land.”

The fourth-generation entrepreneur, whose family has been associated with tea retail and export for nearly 90 years, wants India to take a leaf from Sri Lanka’s book to improve the story of tea.

According to Sarda, Sri Lanka, which is among the top five producers of tea worldwide, faced a similar situation in the 1980s before local brands like Dilmah and the like took charge of the situation and started selling local tea globally.

“I think Sri Lanka is a great example. In the 1980s, they were also exporting their tea as a commodity, and foreign brands kept all the value that Sri Lankan tea would have had. Later, a large number of brands came up and took shipping and promoting packaged Sri Lankan tea from Sri Lanka, This has greatly helped the industry and now the Sri Lankan tea industry is one of the highest contributors to the GDP.

VAHDAM, which has 90 percent of its business coming from the United States, Canada and a couple of European countries, currently ships to more than four million consumers in more than 130 countries.