TWG brews up three more tea outlets in UAE

Above, the TWG shop at the Dubai Mall. Jaime Puebla / The National

Singapore-based TWG Tea is planning to open three new stores in the UAE, two of which will be in Abu Dhabi.

The company has a tea salon and boutique in Festival City and in The Dubai Mall, where it is planning to open another outlet.

“We are opening a second store in Dubai Mall as an extension,” said Nicolas Talon, the group general manager of food and beverage at RSH, a subsidiary of Al Futtaim Group, the retail distributor of TWG Tea. In terms of sales, there is a huge gap in Dubai Mall compared to others in terms of sales, and traffic.

“It will be bigger than our first store but with the same salon and retail side. The salon will be bigger to accommodate larger groups of people.”

The company, founded by Moroccan-born Taha Bouqdib in Singapore in 2008 (the 1837 date on its logo marks the beginning of the tea trade in Singapore) has since expanded to 13 countries including Japan, China, UK, US and Australia since its inception. It is now looking to expand further into the Middle East, including Qatar by 2015.

Currently the majority of its business in the UAE is from the retail distribution side.

“About 80 per cent of our sales come from five-star hotels,” said Mr Talon. “We position it alongside luxury brands and targeting the same segment as Louis Vuitton and Prada.”

Describing itself as a luxury tea brand, its 450 different types of teas range from Dh30 to Dh2,000 per 50 grams. Its most expensive is the Yin Zhen, a white tea with bits of 24-carat gold priced at Dh63,000 per kilo.

The UAE’s tea market is currently worth just under US$60 million but is expected to rise to $70m by 2018, according to Euromonitor International.

“For high-income developed market consumers, tea remains an enjoyable, occasional diversion.This in turn has driven demand for increased customisation, as consumers look for the same kind of personalised variety associated with tea shops,” said Nikola Kosutic, research manager at Euromonitor. “In the process, tea is becoming more akin to a consumer product through retail channels, with a strong emphasis on branding and flavour, rather than the tea itself.”

High-end tea salon and cafes are becoming more prominent in the UAE with the opening of Fortnum and Mason, Angelina’s and Laduree. Unlike many outlets, TWG Tea has a local kitchen in the UAE and makes its products fresh every day rather than import them frozen from abroad.

“The expat customers buy what is familiar to them – the Earl Greys, English Breakfasts, but a lot of the local Arab customers are very well educated about tea. They know what they want, they know which is the best white or green tea, they go for the single estate teas,” said Mr Talon.

According to the Dubai Tea Trading Centre, tea consumption in the UAE stands at about 7 million kilos per year, the second most consumed drink after water. Unilever dominates the market with its Lipton brand.

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