STiR coffee and tea magazine

34 STiR coffee and tea / Issue 5, 2020 (October / November) When Teabox launched as Darjeeling TeaX- press in 2012, "We didn't know how the next 5 or 10 years would look like. It was a step into the unknown… quite a step," reflects Dugarr, recall- ing the economic friction he faced while creating the tea industry's first cold storage supply chain. Teabox vacuum packs and ships tea to custom- ers within 48 hours after processing, eliminating a complex system of processors, distributors, im- porters, exporters, auction houses, warehouses, buyers, and sellers, reducing to a week the typical 3-6 months "between harvest and cup." "Tea is a very old, closed-mindset industry," he observes. "We were trying to pioneer this and liter- ally everyone ridiculed us, including my own dad, who said 'you're wasting your time'." Dugarr's mid- chain efficiencies permit Teabox to offer growers top dollar, but estates with the best teas initially re- served their allotments for overseas buyers. Teabox now purchases hundreds of teas direct from more than 100 tea gardens in Nepal and India and ships to customers in 117 countries and 14 do- mestic markets. The company's sophisticated on- line logistics software learns and retains customer preferences, personalizing their online experience, and gently nudging tea drinkers to expand and up- grade their taste for fine tea. "If you have made a purchase, you will see the same kind of teas on the home page," Dugarr ex- plains. "When we send teas to you, you give us feedback based on your palate: 'Okay, I like it, or No, I didn't like it.' " "We then look at all the other people who have tried these teas and have given similar answers. By the second or third buy, I am able to predict with 85% to 95% accuracy the teas you might end up liking." Selling direct to customers is efficient, but it requires something more to convince tea drinkers to experiment and spend. Guarding Against Cybercrime Cybercrime was escalating at a rapid pace, and on a monumental scale, well before the pandemic. The University of Maryland reports a near-constant rate of hackers' at- tacks — every 39 seconds on average, affecting one in three Americans every year. According to Cybersecurity Services, damage from cyber losses is expected to reach $6 trillion in 2021, with 43% of cyberattacks aimed at small businesses. In the UK, almost half of all businesses (46%) reported cybersecurity breaches or attacks in 2017. According to market research firm Statista, 28% of all Canadian compa- nies reported a cyberattack in 2016, a year in which attacks increased globally by 600%, according to Symantec. The great majority of cyber-attacks are not reported, according to the Hosting Tribunal blog. Many more sit undetected by organizations that simply do not have the systems or technology to identify a breach in the first place. The result is that the actual number of cyber-attacks is far greater than the statistics reported. "Working conditions surrounding Covid-19 have provided a multitude of additional opportunities to cybercriminals. As businesses work remotely or start to transition back to working environments, they are more vulnerable than ever. This is because the tra- ditional infrastructure that organizations relied upon pre-Covid, has been taken away," writes Security HQ, a UK based global security services provider. "With the knowledge that you are sitting at home with vulnerable devices and net- works, endpoints have become the principal target. This is why we see a spike in the amount of malware, DNS, and VPN attacks," according to Security HQ. are up 20.5% in a dry tea category that grew 12% overall. The Lipton-Pepsi Co RTD brands generated $1.7 billion of the total. According to IRI, Arizona sold $825 million worth of tea, and Coca-Cola brands earned $440 million. Consumers drink about 85 liters yearly and globally spend an average of $26.79 per person on tea, according to a 2020 Statista Forecast. Sales world- wide are estimated at $200 billion, with China generating $78 billion of the to- tal. Mintel research, conducted before the pandemic, reveals nearly all (95%) of tea shop consumers in China purchase drinks in physical stores with just over two-thirds (69%) have ordered their drinks online. The pandemic reversed predictions that by 2025 spending out-of-home would increase to 52% of global sales. Euromonitor predicts sales at specialty coffee and tea shops to decline by 11% in 2020 due to restaurant closures. The trend toward premiumization remains, attributed mainly to tea's health benefits. While sales volumes of black tea dropped by at least 10% in the UK, US, and Russia during the five years ending 2019, according to Euromonitor, the price paid per unit increased during that period. Direct-to-consumer pioneer Innovations to the direct-to-customer business model that Dugarr introduced have supercharged tea sales in a dormant channel for nearly a century — fol- lowing a century of success. Before World War II, tea was sold by mail order and delivered by post. The Great Atlantic & Pacific Tea Company (A&P), founded in 1859, grew from a national mail-order tea business to become the largest retailer in the world, with sales in 1930 approaching $50 billion in today's dollars. Teabox founder Kausshal Dugarr pioneered methods of consumer engagement online that increase sales and improve supply chain efficiencies. Restaurants 32,109 Total Closures 39% Temporary Closures 61% Permanent Closures YELP Inc.'s Economic Report in September concluded that 61% of the restaurant business closures that were temporary when the out- break began are now considered permanent. Retailers in California, Texas, New York, and Florida are hardest hit. As of August 31, 32,109 US restaurants have closed, surpassing shopping and retail closures for businesses open March 1. YELP estimates 19,590 are permanent shuttered.

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