; Cwyn's Death By Tea: North American Puerh Buyers ;

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Saturday, April 17, 2021

North American Puerh Buyers

 


Recently Lew Perin sent me some photos of a beeng date stamped 2004 pressed through the efforts of one of our earliest North American puerh bloggers, Mike Petro. The "Just Puer" logo and simple-style wrapper were designed by Mike, and he arranged for the pressing and wrapper printing with a factory in China. An order for custom tea was placed and the communication with the factory required using "an early translation software." This relatively early effort to order factory tea from China reveals to me how little has changed with puerh buying for people in North America. Nearly twenty years later, people interested in buying new and recent factory teas from China are still working channels and translation software. Yet puerh tea consumption and buying has exploded since then. 

While outlets for buying proprietary fresh teas from online boutiques grew tremendously during this same time, markets for people interested in factory teas are still mostly inaccessible and at best inconvenient. With just about everything available online these days, including products from China, I am amazed at the poor access to Chinese factory puerh teas with the size and monetary power of North American puerh buyers. Chinese factories express interest in accessing North America as a market, but perhaps not in a way that currently matches the interests of buyers.

How Many Buyers?

The pandemic, if anything, increased the number of people trying puerh tea at home and looking to buy. Once down the rabbit hole, puerh buyers are additive, no one really goes away. A significant route into puerh tea for the North American buyer is through green tea consumption. Green tea has permeated everywhere in North America. Even where I live, in the middle of nowhere, my very basic grocery store for some reason carries at least a dozen fresh kombucha teas. People are drinking green teas of all sorts and raw sheng puerh is an easy jump to make from green tea. 

This is an important characteristic of North American puerh buyers coming from green teas. The leap from green teas to raw sheng puerh tea is much easier for the cultural palate than it is to go from green or red teas to shou puerh. The path to shou puerh is often through aged sheng. This factor is important to note when looking at the mismatch of puerh marketing further.

But how many of us are out here? The horde of North American buyers is large enough at this point that I struggle for a comparison. I am reminded of the size of specialty cannabis strain buyers back in the 1990s before cannabis became legal. We always had cannabis users in the same way we always have tea drinkers, but a subset of these had an interest in gourmet hybrid strains, hydroponic growing and efforts to develop legal markets. In other words, people no longer buying ditch weed bought gourmet strains of cannabis basically underground for a couple of decades before states made this market legal. Nowadays of course this market is mainstream. I would say that puerh buyers are at least the size of the early days of hybrid cannabis devotees. How big is that? Big enough that current avenues for buying new and recent factory teas are long inadequate.

Current Outlets for Factory Puerh

Right now puerh buyers are fairly well served if a buyer is looking for fresh, proprietary blends of tea from small, individually-owned online puerh vendors. These are house teas and they form the bulk of easily available teas to the American buyer. Really these teas are an incredible gift to puerh buyers. But I have to say that a large contingent of puerh buyers, maybe even the majority of buyers, are also interested in factory puerh teas, if not exclusively so. Even buyers who purchase fresh boutique blends still dabble a finger into factory teas now and again. But the reality is very few vendors sell new and recent factory puerh teas. Very few vendors sell semi-aged teas also, but aged tea is always going to be a secondary re-sale market, unlike for new and recent teas. 

Hard to believe that all these years later, anyone wanting to buy new or recent factory teas is still looking to Yunnan Sourcing and primarily their China location (the US shop currently has one raw Dayi beeng for sale). Aside from Yunnan Sourcing, the few vendors offering factory teas dwindle to a handful of tea shops, with a handful of teas, or enterprising individuals doing special orders or even Taobao buying. Just as Mike Petro worked the translation software all those years ago, nowadays people are plugging in Google translate just to access new and recent vintage factory teas. Western vendors have little to no interest in selling factory teas, and the few people who do offer these teas do so as a courtesy rather than as a focus. Buyers are left to work Taobao or buy teas from other collectors rather than via official or tax-legal market channels. 

What the Buyer is looking for.

North American puerh buyers develop a sophisticated set of preferences for puerh very quickly. The buying community learns fast that spring raw sheng puerh is more desirable than summer or autumn harvests. People want teas with strong bitter and astringent profiles, not the sweet, drink-now versions that some factories are trying to market. People want to age their teas and enjoy their development with varying degrees of success, and this is the fun of the hobby for many. 

Buyers are well versed in the history of puerh teas, and know that the best vintages from the past are factory made, and some are recipe teas and therefore people want an amount of factory tea in their collection. Access to these teas is not as straightforward as might be the case, due to several issues.

Mismatched Markets.

Chinese puerh factories have no need to sell sheng puerh teas to the western market because the Asian market is more than adequate. When the Taetea 7542 of the year reaches over $300/beeng in resale we know the market has little impetus to offer retail 7542 anywhere outside of China. Not to mention the rare special edition teas which rarely see the light of day in western buying outlets. By western buying outlets, I primarily mean Yunnan Sourcing. We also have a few sources like King Tea Mall from Guangzhou, which is a fine seller but again located in China and not in North America. Here too we don't find special edition teas and we pay a premium for resale and shipping, again to be expected.

The biggest mismatch, however, is the actual interest Chinese factories currently have in selling to the west. When reading puercn news and meeting with tea factories at events like the World Tea Expo, the main interest factories have is in selling shou puerh and also "excess tonnage" of tea to the west. Excess tonnage includes summer and autumn tea and anything leftover from late spring which probably also means shou puerh products. Yet where the real money is right now is for sheng puerh products, rather than shou puerh. People want access to the same sheng products factories are producing primarily for Asian markets. 

Non-specific Warehouse Vendors.

Sheng puerh teas can be found in warehouse model vendors like Awazon at Amazon. Occasionally teas sell on eBay but most buyers view eBay as a less desirable way to purchase tea due to the possibility of fakes. Aliexpress had factory puerh teas at one point, but Aliexpress banned the sale a few years ago which was a loss of access for North American buyers. Taobao is even more difficult now, and sometimes boots online accounts from the west, and requires a buying agent and navigating in Chinese. 

People are still buying from Yunnan Sourcing after so many years. We have to give props to Yunnan Sourcing for offering at least some factory teas, even if most of these are ripe shou teas. But Yunnan Sourcing is a large vendor with their own house teas and equal if not greater emphasis on other types of Chinese tea. Scott has spoken about looking for a way to retire someday, and so this single outlet which barely meets the demand will not be around forever. 

Boutiques and Tea Shops.

Small outlets like these are not able to adequately serve buyers looking for factory teas. I would include possible ideas like franchising, such as when Taetea licenses small dealers as official retailers. The problem here is the lack of access to capital to purchase stock up front and then sell it. We don't have a retail loan structure for puerh vending because the financial world by and large is still ignorant of Chinese tea. 

Then we have a problem experienced by nearly all small boutique retailers. The further away distance-wise the retailer is from the factory source, the lower the priority for stock. This is an issue in every designer goods sector. The retailer has plenty of buyers, but is not getting in the stock needed to satiate the buying appetite of the customers. Most designer boutiques have this problem, lots of buyers but the shop doesn't get priority from the factory label for shipments. This is where a franchise model in the US is likely to fail. Not only is retail space expensive, but a US location is on the low end of the totem pole compared to Asian locations. A franchise won't get enough stock for the size of the puerh buying community.

And how big is that buying community again? We are large enough at this point with enough dollars that a single retail location shipment could be bought up entirely by one buyer. Just think if that 2021 7542 had made it to a retail location in the US at the original retail price. One person easily would swoop all that tea up in a single buy, and any appearance online would result in inquiries from overseas buyers as well. This is yet again why a small shop or boutique-style vendor or franchise cannot possibly keep up with customer demand for factory sheng puerh, even if that shop had adequate access to stock which it likely won't at such a distance. We have all too many buyers with the money to buy up tongs and tongs of tea, single-handedly. Then we have huge group buying efforts to pool money and split tong purchases. Good luck to any retailer looking to keep up with this kind of behavior. It won't happen. 

Addressing the Mismatched Market.

We want more than the dusty tea brick from a local market shop. But we can't simply apply more pressure to existing outlets. Something has to give in the Chinese market to improve sales and access to North America. We have the buyers. We have plenty of money to spend. What can be done to improve access to sheng puerh tea?

Warehouse-model selling.

Chen Sheng Hao has taken the step of opening a warehouse in Vancouver. North American buyers can now access these teas through this warehouse. However, their pricing and products are on the top tier end. Right now I am sure the customers in this market need convincing that CSH teas are worth $1000/beeng. I don't think buyers are certain CSH teas are of a quality to merit this price tag, and if the teas are, then people need experience trying the teas to find out. The main market is looking to buy lower, at the under $100/beeng price point but in bulk.

Yet the warehouse model is precisely what is needed to meet consumer demand because the small boutique does not have the capital nor the priority. More factories will hopefully follow the example of Chen Sheng Hao and open warehouse options in North America with teas at a lower price point.

Develop and sell new recipe teas and teas with a picking standard.

Do what you do well. Customers want spring teas and especially teas with a bitter and astringent profile designed for aging and warm humid weather. Factories could develop new recipes and productions for everyone, everywhere, that could incorporate some of that excess summer and autumn tonnage blended with spring tea. Or offer more premium blends that adhere to a picking standard, such as the one-bud-two-leaf, rather than the chopped over-oxidized mess that many productions use. 

Once a customer develops a taste for aged raw puerh, they are more open to drinking shou and other heicha teas like Fu Zhuan and bamboo stored Liu Baos. Cultivate the raw sheng customer with the carrot of what they want, and other teas are likely to benefit from increased sales. 

Open up factory-direct and Taobao with English service and shipping. 

I realize this is a diplomatic stretch involving many cultural factors. I know China does not need our puerh business. But North American puerh buyers are a well-educated and gainfully employed lot, in a variety of industries, and they drink tea at work. Sommeliers are more popular in food service and we have thriving $100/session puerh service in fine restaurants in places like New York City. Many unknown business connections into the future may be gained in North America in the same way as puerh enhances business relationships and diplomacy in China. 

Support the secondary puerh market by offering factory teas.

More factory teas in the hands of collectors means more tea for potential resale later as aged teas in our own markets, which leads to more interested tea drinkers buying new. It's a cycle. To expand our aged offerings so we don't need middlemen in Asia, we need to buy teas direct when they are new and recent and more cost-effective. 

Over the past year, we read lots of bad news about Chinese-North American relations and attitudes. Yet I can assure the reader that the opposite is the case with regard to Yunnanese sheng puerh tea. More and more people are attracted to this tea and yet the buyer opportunities, especially for factory teas, have hardly changed in the past twenty years. Tea is consumed and gone forever, and so the market only increases in demand. The buyers here are legion and ready to spend money when opportunities arise and we need more legitimate and direct sales options to meet the increasing demand.

Photo credit: photos shown are by the kindness and permission of Lew Perin (photographer) and Mike Petro. 




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