The Spring 2016 issue of the Upton Tea Quarterly landed in my mailbox the other day, and I was surprised to see an old office copier on the cover. It illustrates Part XXXIX: Mergers and Acquisitions (XXXIX!) of the series "Reversals of Fortune in the Tea Industry," and a discussion of office supply company mergers and acquisitions leads into a discussion of mergers and acquisitions in the specialty tea and coffee business.
Many of the old office supply stores and chains were founded in the 1980s and enjoyed rapid growth, the article points out, but the with the advent of email, scanning, and disk storage, many of the old paper-managing systems were no longer needed, and naturally the office products industry was affected. The article compares this once-growing field to the coffee and tea industry, which it notes that some people continue to view as a single industry.
According to this article, back in 1994, Starbucks bought a 24-store chain called The Coffee Connection. The chain had been owned by a George Howell, who also had a passion for tea and had sold loose leaf teas at The Coffee Connection. When Starbucks bought the chain, they decided to sell their own tea brand, Tazo, which replaced the line that had been sold by George Howell. Tea-drinking customers of The Coffee Connection were not happy.
The Upton article notes, "We soon learned that employees of The Coffee Connection, now employed by Starbucks, had been told to give their unhappy tea customers the phone number of Upton Tea Imports. Business at Upton Tea Imports grew 20 percent overnight!" And the article concludes, "There were, however, some glitches that had to be untangled over the coming months."
I must confess I'm not sure where this article is headed with this discussion of mergers and acquisitions in the tea and coffee industry, but I'm curious enough that I'll definitely be reading the next installment in the Summer issue! Click here to read the current article for yourself.