Tea is a global tradition, with countries all around the world having different values attached to the beverage. Tea is the world’s second most popular beverage, with different societies drinking it for pleasure, for healing purposes or to spend time with friends and family.
Yswara, a luxury tea company based in Johannesburg, South Africa, was launched in 2012. Its founder and CEO, Swaady Martin-Leke, a national of Côte d’Ivoire, hand-selects the tea from the various African countries, to incorporate into her company’s collection of 23 varieties of tea.
“I created Yswara out of the frustration of seeing one of Africa’s abundant commodities a victim of the commodity trap, [it’s] an international export with no to limited value-add done in Africa,” she says.
Yswara products aim to embody the spirit of Africa; they are all handcrafted and organically-inspired, with African provenance and cultural cachet.
Tea selection
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According to Martin-Leke, specialty tea is the fastest-growing segment within the industry, with gross margins above 60%. She says that consumers are increasingly looking for diverse origins and flavors of teas, and the niché gourmet tea market has only a few luxury brands. Most tea brands are in the premium and mass-market segments.
The growth of the Africa tea market will be driven primarily by an increasing consumer focus on health and wellness, and the continuing emergence of epicurean preferences in food and beverages.
“The gourmet tea market has been traditionally dominated by old French and English tea brands such as Mariage Frères, Dammann Frères, Fortnum & Mason and Tea Palace. TWG from Singapore is challenging the French dominance over gourmet teas and demonstrated their increased popularity in both emerging and developed markets. TWG recorded $30 million in revenue in its first full year of operation after an investment of $10 million,” says Martin-Leke.
This curator of precious African teas wants to make her offering a prestigious product through educating customers on the quality and benefits of African teas, by creating an experience that includes African tea rituals, African-made tea paraphernalia and elegant packaging.
“I outsourced various suppliers such as Andrew Burke of Pure Publishing to work on the creative concepts thus providing Yswara with a brand identity. I also worked with Raynaldyne Molon, who has contributed to the development of international Nespresso, the redesigning the lobby for Victor Hugo and the restaurant company for L’Oréal Produits de Luxe and other clients. I also have great mentors who are experts in the field and guided me, such as Wilfried Guerrand, the head of Hermes Woman. I want Yswara to be placed next to Hermes soon, in the global markets,” she says.
Martin-Leke sources Yswara’s tea from South Africa, Malawi, Rwanda and Kenya with plans to source from Burundi, Cameroon, Madagascar, Malawi, Rwanda and Zimbabwe. All her staff are women and the suppliers must be 75% female-owned or managed.
“The gourmet tea market in Africa will disappear if brands like Yswara and government initiatives in Africa, such as in Rwanda, don’t support the promotion of better quality tea. Africa will end up producing low-quality tea for mass consumption. Such teas are lower margins for our farmers,” she says.
The thirst for luxury goods in Africa requires in-depth understanding of the market’s mechanics, which differ from mass market businesses.
While Africa has more millionaires than Russia—the number of African millionaires rose 3.9% last year, faster growth than any region except Latin America—the majority of them shop in Europe for luxury goods because there is a very small market in Africa.
Africa’s rapid growth, booming cities and an aspirational middle-class are prompting luxury brands to enter untapped markets across the continent, although the difficulty of finding suitable sites for luxury stores means progress could be slow.
Building an African luxury brand has its challenges. Yswara hopes to be 100% made-in-Africa, by 2014. The main challenge is that Africa’s industrial setting is not accustomed to producing high-quality goods produced at a competitive cost, compared to China or India.
“We struggled to find suppliers who source or manufacture their products in Africa. Then, when world-class quality is met, the consistency is not guaranteed. For example, our tea tin manufacturer just closed this month and there is no alternative in sub-Saharan Africa,” she says.
Sub-standard quality affects a brand and makes it difficult to compete against international luxury brands.
“The cost of exporting outside of Africa is still too high. This is hampering growth of internet sales as well as opportunities to export out of Africa globally,” says Martin-Leke.
The South African specialty tea market only represents $250 million. With limited competition and an aggressive market entry strategy, based on opinion shapers and intensive education campaigns on tea quality, Yswara could grow revenues up to $8 million, or $12 million by year five of operations.
Yswara is targeting the international tea consumers, who are looking for a new tea experience and discover Africa as a tea region. Yswara will also expand globally from year four of operations [to Europe and the States]. We will start with online penetration and expand into direct and indirect retail.”
Packaging is a crucial element of a luxury brand. The brand stands for authenticity, refinement, timeless elegance and an Afropolitan lifestyle.
“The packaging is a key element of a luxury product; it is what the customer picks up. It is, together with the name, the carrier of the product’s luxury,” says Martin-Leke.
Yswara’s pay-off line is “Made in Africa for the World”, and the distinctive African wax Ankara print recalls the ambiance of West African culture.
Martin-Leke is already shipping her luxury tea around the world via her online store and online partners like africacandy.com.
“When going into the luxury market, push the barriers of excellence in Africa… and participate in making the continent a recognized destination for luxury goods rivaling its international counterparts. Africa is too often viewed as a place of low-quality goods and lack of refinement, while our thousands of years of culture, history, know-how and heritage demonstrate that we can do more than producing crafts and ethnic goods,” says Martin-Leke.
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