Teaxpress: Assamese entrepreneur Kaushal Dugar using e-commerce to supply quality packaged tea
20 Apr, 2014, 0512 hrs IST By Jyoti Pande Lavakare I'm walking in a verdant tea plantation in Assam, having driven past several glittering tea gardens and some interesting retail outlets with a dazzling array of tea varieties, seriously wondering why no one ever thought to develop tea-estate tours the way wine tours are done in Napa or Bordeaux or Stellenbosch. After all, the taste of tea, like wine, depends on terroir, growth period, variety, climate and processing refinement. This region seems like it still belongs to a previous century, and that feeling is reinforced the next day when I wander through old Guwahati. Antiquated, decrepit shops with mounds of tea intersperse with others that sell rice in hundreds of varieties (including one that needs no cooking, called komal saul) and I can almost imagine commodities, especially tea, being auctioned here the oldfashioned way. Then, serendipitously, I discover an innovator.
Whiff of Opportunity Kaushal Dugar's speciality e-commerce startup supplies freshly packaged premium teas across some of the most discerning and lucrative markets for high-end teas — Russia, US, Canada and Australia — and is now targeting Japan and China. Although he founded Teaxpress Pvt Ltd in 2012 with his savings of Rs 25 lakh, he has just raised $1 million in seed funding from venture capital firm Accel Partners India and Singapore-based Horizon Ventures, and plans to use that money to build a strong, back-end infrastructure for what he calls an "end-to end supply chain." His unique value proposition? Getting the freshest, most flavourful teas from garden to vacuum packs within 24-48 hours, thus sealing in taste and fragrance, with the ability to deliver to the consumer as early as within the week, a process that traditionally took up to six months. Apart from the obvious advantage of cutting out the several stages of the traditional middlemen, resellers, blenders and distributors that define regular tea trade, what Dugar's start-up does is streamline and structure all processes — from selecting and procuring the tea within hours of plucking and processing, to packaging and delivering it directly to consumers. His tech team uses search engine optimization for visibility, customer analytics and complex algorithms to predict demand and delivery, and an elaborate system of tracking his courier routes in 65 countries. Dugar aims to build an online teahouse for the discerning tea lovers who can afford to pay for their indulgence. In fact, once ready, it will be a plug-and-play model and can be used to sell spices or any other localized, boutique product. He is confident of the market. And that's Dugar's other USP — he is among the rare breed of entrepreneurs who is located at the source (he was born and raised in Siliguri) and has intimate knowledge of the industry (his family has been associated with the tea business for generations) as well as the business savvy of an international trader and the ability to put in the long hours of a consultant (he studied in Singapore and worked with KPMG there for almost eight years). Teabox (that's what Dugar's tea label is called) sells only highend teas — and Dugar wants to make it an international boutique brand — going beyond the Mariage Freres of France or England's Taylors of Harrogate. Despite the smaller quantities he buys compared to the giant blenders and resellers, tea planters are becoming interested in selling to him because he makes them visible, bringing recognition to individual gardens and boutique estates. Going Global "Some of the best global brands contain tea grown here in India but we don't have a single internationally known premium tea brand that we can be proud of in our 200-year-old industry," says Dugar. India produced 1,200 million kg of tea in 2013, of which almost 960 million kg came from Assam and West Bengal. "We're creating our own state of the art infrastructure — centres with temperature and humidity-controlled facilities where the teas go through extensive quality control," so that Teabox teas can compare with the best in the world. All this is capital-intensive, and Dugar expects to start making profits only by 2017 and will need more funding before that. Dugar is so certain of his product as well as his customers that he isn't really focusing on India. However, anyone can order his teas - that's the beauty of ecommerce — and my elegantly packaged sample teas arrived within three working days. The quality was better than what I'd bought directly from retail stores in the heart of tea gardens I'd visited and the packaging was of international quality. Once his real business takes off, Dugar plans to educate tea enthusiasts in India through "subscription" offers, free samples with existing orders and virtual and real tea-estate tours. He will use social media, online videos and digital marketing to grow the business. Like winetasting notes, his site already has tasting notes that tea connoisseurs are familiar with. His team of four tea-tasters tastes almost 200 cups of tea a day, selecting 2-3 out of those varieties, he says. "Right now, our focus is very international. Our Russian language website is up and we will begin our Japanese and Chinese language sites soon," he says. Teabox expects to ship almost 36,000 kg, around 18 million cups this year. The average order value is $110 per pack. But Dugar's latest offering Margaret's Hope Clonal Flowery Darjeeling White tea is priced at $1,100 per kg. Something most of us can only hope to taste on a teaestate tour. (The author is an independent columnist and writer)