How to Start Tea Business in India – A Complete Guide

Tea is more than just a drink in India; it’s an emotion that connects people across regions, cultures, and lifestyles. With over 837,000 tons of tea consumed every year, India is one of the largest tea markets in the world. If you’re thinking of starting a tea business in India, you are on the right track!

From roadside stalls to luxury tea brands, the Indian tea market offers multiple opportunities for business growth. This guide will help you understand the market, choose the right business model, set up operations, and scale your tea business successfully.

Why Start a Tea Business in India?

Before you invest time and money, let’s understand why tea is a profitable business in India:

✔ Huge Demand – Tea is consumed by over 80% of Indian households daily.

✔ Flexible Business Models – You can start with a small stall, café, or even an online store.

✔ Scalable Growth – Many successful tea brands, like Chai Sutta Bar, MBA Chaiwala, and Chaayos, started small but grew into multi-crore businesses.

✔ Profitability – With the right pricing and sourcing, the tea business can offer profit margins of 30-50%.

✔ Low Investment – You can start a tea stall with just ₹10,000 or a packaged tea business with ₹50,000.

Types of Tea Businesses You Can Start

There are multiple ways to enter the tea market. Below are the popular tea business models in India:

Tea Business Type	Investment Required	Monthly Earning Potential
Tea Stall (Thela / Small Shop)	₹10,000 - ₹50,000	₹15,000 - ₹50,000
Tea Café / Franchise	₹2L - ₹10L	₹50,000 - ₹2L
Packaged Tea Business	₹50,000 - ₹5L	₹30,000 - ₹1.5L
Online Tea Selling	₹20,000 - ₹1L	₹20,000 - ₹1L
Tea Wholesale Business	₹2L - ₹10L	₹50,000 - ₹3L

Choosing the Right Business Model

• If you want low investment, start a tea stall or wholesale business.

• If you want a premium brand, start a packaged tea business.

• If you love online business, sell flavored teas on Amazon or your website.

Step-by-Step Guide to Start a Tea Business in India

Step 1: Conduct Market Research

• Identify the most popular tea varieties in your target market (Masala Chai, Green Tea, Assam Tea, etc.).

• Check competitor pricing and branding strategies.

• Find high-demand locations if you are opening a stall or café.

Step 2: Choose Your Business Model

Decide how you want to sell tea:

• Retail (selling directly to customers via a stall or café).

• Wholesale (supplying tea to retailers, hotels, and restaurants).

• E-commerce (selling packaged tea online).

Step 3: Arrange Capital and Investment

Your investment will depend on the scale of business. For example:

• Tea Stall – ₹10,000 to ₹50,000

• Packaged Tea Business – ₹50,000 to ₹5 Lakhs

• Café / Franchise – ₹2 Lakhs to ₹10 Lakhs

Consider bank loans, government MSME schemes, or personal savings for funding.

Step 4: Get Required Licenses and Registration

For selling tea legally, you need the following:

License / Registration	Purpose	Where to Apply
FSSAI License	For food safety approval	FSSAI Website
GST Registration	Tax registration if turnover > ₹40L	GST Portal
Shop & Establishment License	For opening a shop/café	Local municipal office
Trademark Registration	To protect brand name	IP India

Step 5: Source High-Quality Tea

• Buy directly from Assam, Darjeeling, Nilgiri, or Kangra tea gardens.

• Work with reliable tea wholesalers for bulk supply.

• If selling premium tea, ensure organic certification.

Step 6: Packaging and Branding

For a packaged tea business, branding is critical:

• Choose an attractive logo and brand name.

• Use high-quality, airtight packaging to maintain freshness.

• Highlight unique selling points (e.g., masala chai with real spices).

Step 7: Selling and Marketing Your Tea Business

Use multiple channels to sell tea: ✔ Local Store – Open a tea café or retail shop. ✔ Online Platforms – Sell on Amazon, Flipkart, and Instagram. ✔ WhatsApp Business – Promote tea directly to customers. ✔ Social Media Marketing – Share engaging chai content on Facebook & Instagram.

How Much Profit Can You Make?

The profit margins in the tea business depend on the type of business and pricing strategy.

Tea Type	Buying Price (Per Kg)	Selling Price (Per Kg)	Profit Margin
Assam CTC Tea	₹120	₹200	40%
Darjeeling Tea	₹400	₹700	50-60%
Green Tea	₹250	₹500	50%
Masala Tea	₹180	₹350	45-50%

A tea stall can earn ₹15,000 to ₹50,000 per month, while a packaged tea brand can make ₹1 lakh+ per month if marketed well.

Challenges in the Tea Business

Like any business, the tea business has some challenges: ⚠ Competition – Many small and big brands are in the market. ⚠ Price Wars – Some tea sellers offer low prices, reducing profit margins. ⚠ Logistics – If selling online, shipping costs can be high. ⚠ Seasonal Demand – Tea sales are higher in winter and lower in summer.

How to Overcome These Challenges?

✔ Focus on quality – Use premium tea and strong branding. ✔ Offer unique products – Like flavored teas (elaichi, ginger, tulsi). ✔ Build customer loyalty – Offer discounts & referral programs.

Conclusion

Starting a tea business in India is one of the best opportunities for entrepreneurs aged 30 to 55 looking for low investment and high returns.

With proper planning, quality tea sourcing, and smart marketing, you can build a profitable tea business. Whether it's a tea stall, café, or packaged tea brand, India’s love for chai ensures there is always a market for good tea.

So, are you ready to start your own tea business? Let us know in the comments!