The results are in from World Tea News’ 2025 State of the Industry Survey!
Nearly 180 members of the tea industry participated in the survey, with the majority holding executive management roles (23.5%). Most respondents identified as tea retailers (24.6%) or as a tea room/house/bar/outlet (20.7%). Rounding out the top three sectors were those from web-based tea stores (8.9%).
Financial Frustrations
This year’s survey comes at a time when the tea industry is facing strong headwinds in the form of tariffs, climate change, and shifting consumer demand. When asked what has most impacted their tea sales, the answer that came in second was tariffs/inflation/rising costs (21.2%). This was followed by price sensitivity (15.6%).
Still, most of those who responded were positive about the outlook of the tea trade, with 51.4% believing the industry is facing challenges but steady, and 25.7% believing the industry is stable with moderate growth.
When it comes to their own businesses, that positive attitude continued, with 58% of respondents expecting moderate growth. In fact, 77% plan to invest in new products and services for their business in the next year. The top areas cited for investment included teas/tisanes (73.9%), herbals and botanicals (49.3%), packaging (47.8%), and specialty items (accessories, tea ware, giftware) (49.3%).
Budgets will remain modest, however, with 24.6% planning to spend less than $5,000 and 22.3% planning to spend between $5-$10,000.
Facing Challenges
One of the reasons for the modest investment budgets may come from the twin issues respondents cited as their top challenges: rising costs and tariffs (20.1% for both).
Attracting and retaining customers (16.2%) rounded out the top three challenges, and this was also cited as the top goal (29.1%) for the tea industry in 2025. The number-two goal was increasing revenue (14.5%), which aligns with high-ranking economic concerns.
Speaking of pricing pressures, to combat economic headwinds—as well as retain customers—the tea industry cited two top solutions they would be pursuing.
Enhanced Marketing
16.2% of respondents said they would be enhancing their marketing as a solution. Seen as an essential investment rather than discretionary spending, marketing can serve as a two-pronged solution to customer retention as well as a response to rising prices. When asked what their primary method of marketing is, most respondents said Instagram (30.2%), followed by email marketing (20.1%).
Expanding into New Markets/Channels
20.1% of tea companies are taking an offensive approach by expanding into new markets and channels. This can include selling in emerging tea markets like Africa and the Middle East, or investing in an e-commerce platform to increase the pool of potential customers.
Other tea businesses are turning to trending products. When asked what the biggest consumer trends in tea are, respondents chose functional/wellness teas (25.1%). In fact, when asked what has most impacted their tea sales, the majority of respondents said an interest in health and wellness (26.3%), showcasing the power of this category.
The second- and third-most popular trending products were premium and specialty loose-leaf teas (15%) and flavored teas (14%), demonstrating that consumers are looking for quality and choice.
As for tea types, black tea (29.6%) was the clear winner with consumers, followed by green tea (14.5%) and functional/wellness teas (11.2%). Fruit was repeatedly mentioned as a favorite flavor of tea.
On the other side of the coin, survey respondents cited yellow tea (11.7%) and white tea (10.6%) as the least popular tea types with their customers.
Aside from trending products, those with a brick-and-mortar shop have looked at diversifying income through events. Respondents ranked afternoon tea (15%) and tastings/flights (14%) as the trendiest tea experiences amongst consumers.
Sourcing & Supplying
Rounding out the top three solutions to challenges was diversifying suppliers (15.6%), which is closely linked to tariff concerns. While many survey respondents said they primarily source tea from China (33%) or India (20.7%), many others (24%) cited using multiple sources or a wholesale distributor. When asked how they source their tea, domestic wholesalers led the way at 32.4%, followed by origins (24%).
It seems the tea industry is pursuing multiple strategies simultaneously rather than betting heavily on any single approach to combat challenges.
Rather than retreating in the face of economic pressures, tea businesses are taking a diversified approach to growth. The multi-pronged strategy of product diversification, market expansion, and supplier diversification positions the tea industry to navigate current challenges while building a foundation for sustainable growth.
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