PRESENTATION BY:
SICILY KARIUKI (Mrs),MBS
MANAGING DIRECTOR
TEA BOARD OF KENYA
January 2012
1
CONTENT
1. Introduction-The Kenya Tea Industry
2. Supply, Demand and Trade Situation
3. Distribution Channels
4. Market Share Analysis
5. Economic Factors Affecting Demand
6. Non-Economic Factors Affecting Demand
7. Market Promotion-Types and Impacts
2
INRODUCTION-KENYA SUPPLYING TEA
TO THE REST OF THE WORLD(OVER
FIFTY DESTINATIONS WORLDWIDE
3
Planted Area
165,000
163,073
161,916
160,000
HECTARES
157,720
158,394
155,000
150,000
149,196
145,000
140,000
2007
2008
2009
2010
2011
YEAR
4
Kenya tea Production
450
400
399
369
350
377
346
314
MILLION KGS
300
250
200
150
100
50
-
2007
2008
2009
2010
2011
YEAR
5
The Kenya Tea Industry-Growth drivers
Overall growth realized as a result of:

Consistent High quality

Ongoing Research and Development and Physical investment.

Responsiveness to global requirements.

Facilitative process and structures(Public and private)

Developed infrastructure.

Efficient distribution channels.
6
Kenya Tea Imports
IMPORTATIONS FOR REEXPORTS
IMPORTATIONS FOR
CONSUMPTION
COUNTRY OF ORIGIN
COUNTRY OF ORIGIN
KENYA (EPZ)
ARGENTINA
UK
UGANDA
INDIA
IRAN
ARGENTINA
INDIA
EAST AFRICA COMMUNITY
OTHERS
INDONESIA
OTHERS
GRAND TOTAL 13 M Kg
Grand Total 4.9 M Kg’s
7
Apparent Consumption
30
Local teas
Apparent Consumption
25
MILLION KGS
20
21.1
21.3
17.6
17.3
22.6
18.1
25.3
23.7
18.7
20.0
15
10
5
0
2007
2008
2009
2010
2011
YEAR
*Apparent Consumption- locally produced and imported tea
8
Distribution Channels
Tea manufactured from
tea leaf by Tea Factory
In the form of loose tea
in bulk package
To domestic
consumer
through
Retail outlets
Directly to
overseas
Buyers
(direct export)
Through public
tea auction
In value added form
To registered
Primary buyers
Directly to overseas
Buyers as
Direct export
To merchant packers
for sales to
Domestic consumer
as packet tea
To domestic consumer
through secondary buyers
To domestic consumer
Through retail outlet and FDS
9
Market Share Analysis-Type of Outlets
# TYPE OF OUTLET
PERCENTAGE
1
AUCTION
82.19%
2
DIRECT SALES
13.26%
3
FACTORY DOOR SALES
2.11%
4
SALES TO PACKERS( RETAIL OUTLETS)
1.75%
10
Market Share Analysis-Type of product
#
PRODUCT TYPE
PERCENTAGE
1
BLACK LOOSE TEA
92%
2
TEA BAGS
3%
3
INSTANT TEA
1%
4
ICE TEA
0.5%
5
FLAVORED TEA
1.5%
6
SPECIAL TY TEA (GREEN,PURPLE ,WHITE)
2%
11
Economic Factors Affecting Demand

Price of tea

Inflation & Disposable income.

Price of additives such as milk and sugar.
12
Non-Economic Factors Affecting Demand

Population

Weather Conditions (cold/hot).

Consumption habits (Not considered an all
time drink).

Competition
from
other
beverages
(cold/hot)

Product presentation.

Family size and age.
13
Non-Economic Factors Affecting Demand

Perception
(“tea
is
for
the
old
Generation”)

Promotion
14
Market Promotion-Types and Impact

Local Generic Promotion-Promotion of tea
as a lifestyle drink/health platform.

Branding of tea through Mark Of Origin.

Exploring New/Emerging markets.
15
Market Promotion-Types and Impact (Prospects for market
expansion)

“Out of home” settings.

Focus on the growing youth segment.

Urban working class women

East Africa Community/COMESA
16
Market Promotion-Successful experience.

Introduction of ice tea in Kenya to capture
the ‘consumers on the go”

Increased popularity of flavored tea.

Increase in demand for instant tea.

Gradual establishment of the tea drinking
culture.
17
Local Generic Promotion
18
Local Generic Promotion
19
INTERNATIONAL TEA FOR
HEALTH MARATHON
Where the world’s finest athletes and the world’s tea meet.
20
Local Generic Promotion
AWARDING EXCELLENCE IN THE TEA SECTOR IN KENYA
DURING THE NATIONAL TEA DRINKING DAY.
21
KENYA TEA
MARK OF ORIGIN,
22
ISO 9001:2008certified
22
CONTACT
Tea Board of Kenya,
P O Box 20064 -00200 NAIROBI
Telephone: +254-20-3874446; +254-20-2536886;
+254-20-2536869
Cell phone: +254-722 200556; +254-734 600944
Fax: +254-20-3862120; +254-20-3876337.
Email info@teaboard.or.ke
Website: www.teaboard.or.ke
23
ISO 9001:20008certified
23