With rising incomes, smart new tea houses are popping up all over India’s large cities, and chai, India’s traditional milky spiced black tea, is feature large on the menu. Per capita consumption in India is lower (1.8 lb. per person), than in other countries such as the UK (4.4 lb. per person) and Sri Lanka (2.2 lb. per person).
New entrepreneurs see an opportunity to increase sales by making tea more exciting. Many are taking their lead from Cafe Coffee Day, a $175 million chain backed by KKR & Co., that went public in October operates 1,555 shops and 32,071 coffee vending machines. Teas include Assam, Darjeeling, green tea, masala chai, masala chai latte, and a cold green apple tea-ni. Recognizing Starbuck’s success in the US with coffee, a drink that was already popular in the country, Indian tea-house owners hope to be able to do the same with tea.
By taking traditional street tea, brewing it with better quality tea, and giving it a stylish modern twist, chai could become a real money spinner. Niyin Saluja became aware of chai’s potential about three years ago while living in the US and now owns Chaayos, a chain of 12 tea outlets in Delhi. The company plans to open more 50 stores by May 2016 in Mumbai and Bangalore. Other new chains include Tea Trails and Chaipatty.