Category Archives: Tea

As easy as: ABC tea shops

The ABC tea shop was a ubiquitous part of early twentieth century London life, mentioned by T S Eliot and Virginia Woolf, and lambasted by George Orwell.

The Aerated Bread Company (ABC) was incorporated in London in 1862 with a nominal capital of £500,000. It was formed to manufacture bread using a new patented process which used carbon dioxide instead of yeast.

As a mass producer, the ABC had a large number of contracts with institutions such as schools and hospitals. It also had a number of retail outlets in London which sold bread and cakes directly to consumers.

In 1884 a manageress at a ABC bakery shop near London Bridge Station suggested to the directors that on-site sales of tea might increase revenues. This proved successful, and was rolled out across all outlets.

The tea shops proved popular among clerical workers, who appreciated their affordable prices, and by 1889 there were around 70 outlets.

An ABC shop at Ludgate Hill, date unknown
An ABC shop at Ludgate Hill, date unknown

From 1891, production at a centralised bakery in Camden Town helped to keep costs low. The low-margin business received criticism for the low-pay of ABC waitresses, who worked a 62 hour week.

J Lyons opened its first tea shop in 1894. Lyons branches were more upmarket and better managed than the ABC shops, and by 1911 Lyons had overtaken its rival in number of central London outlets.

ABC served over 1.25 million customers in 1911. By 1912 there were 150 branches. By this time the tea shops had evolved into cheap restaurants. In 1911 a commentator wrote that service was slow, but the quality of the tea was “beyond reproach”.

By 1913 ABC was far better known for its London tea shops than its bread manufacture.

In 1918 ABC acquired W & G Buszard, a London bakery chain with 140 shops. ABC were attracted to the merger by the strong management team at Buszard. Buszard directors, led by Charles Cottier (1869 – 1928) and Frederick Hutter (1876 – 1927), quickly came to dominate the ABC board.

Cottier was a forceful personality, and led by him, ABC undertook numerous acquisitions from 1919. These were Bertram & Co (railway catering), James Cottle (Liverpool and Manchester restaurants), Cabins, JP Restaurants (with 80 outlets around London), Newberys (shop-fitters), Abford Estates (a large property development) and a controlling interest in W Hill & Sons (29 shops), at a combined cost of just under £500,000.

By 1921 the managing director of ABC, Frederick Hutter, was described as the “Napoleon” of the London catering trade. Hutter had humble origins, beginning his career as a baker’s assistant. As well as hundreds of tea shops the company also owned the prestigious Criterion restaurant in Piccadilly.

By 1922 ABC had a total of 200 to 250 tea shops and restaurants. By 1925 over 2 million people drank tea in either a Lyons or an ABC tea shop in London every week. The manufacturing site at Camden Town covered over four acres.

By 1926 ABC had 156 branches across London. That year also saw the prim Victorian black and white waitress uniforms replaced by blue dresses.

In 1926 ABC built the largest single tea shop in Britain, opposite Victoria Station. The site was bought from the Duke of Westminster, supposedly for £500,000.

By 1929 paid up capital at ABC amounted to £1.75 million.

In 1929, in the wake of low profits, the well-known accountant Sir W H Peat was contracted to perform an independent review of the company. He argued that the numerous acquisitions did not tie in with the core ABC business, and as such, very few economies of scale could be made. He also argued that the company had paid excessive dividends, and had failed to update and modernise its shops, which had become run down.

The manufacture of aerated bread ended in 1954.

In 1955, ABC, with 164 tea shops, was acquired by Allied Bakeries, controlled by W Garfield Weston, for nearly £3 million. By this time ABC was the second largest chain of restaurants in Britain. Allied Bakeries was motivated by the increase in outlets for its bakery products, and valued the ABC estate at between £1.7 million and £2 million.

Unprofitable branches were quickly sold off, and new outlets opened at better locations. Allied Bakeries invested in the stores to bring them up to the standard of their competitors. The changes worked, and by 1959 the loss-making venture had become one of the most profitable parts of Allied Bakeries.

In 1959 Allied Bakeries sold the Abford House subsidiary, which consisted of a large freehold property in Victoria, London, for over £500,000 to Spiers & Pond, a catering company.

In 1962 ABC reported a profit before tax of over £850,000. In 1966, a pre-tax profit of £735,000 was reported.

Throughout the 1960s and the 1970s the trade of the tea shops began to decline. Rivals with no or limited seating had lower overheads. By 1976 there were 200 ABC outlets, but the tea shops were being phased out in favour of take-away bakery shops.

In 1976, production of small, hand-finished cakes at the Camden Town site was ended. This resulted in the loss of over 400 jobs. The Camden Town site was antiquated, and unsuited for modern production, and in 1982 it was closed for good, with the loss of a further 200 jobs. The ABC tea shops also disappeared around this time.

The Camden site was demolished a few years later, and a Sainsbury’s supermarket now stands in its place. Any residual ABC trademarks are held by Associated British Foods, the successor company to Allied Bakeries.

Brewing up a storm: Tetley tea

After successfully introducing the tea bag to Britain, Tetley grew to lead the market.

In 1837, Joseph Tetley (1811 -1899) and his brother Edward began to sell salt from a horse and cart in Bradford, Yorkshire. Before long, tea was added to their wares.

By 1851 the business had relocated to Huddersfield, and employed 14 people. In 1856 the Tetley brothers moved to 25 Cullum Street in London, close to the tea auction houses of Mincing Lane. In 1861 the business employed 18 people.

In 1865 Edward left the business. Joseph brought in Joseph Ackland as a partner and the business traded as Joseph Tetley & Co.

In 1871 Joseph took on his son, Joseph Tetley Jr (1850 – 1935) and long-term employee Samuel Furniss as partners in the business. Tetley & Co also expanded into blending and packaging tea for itself.

In 1880 Ackland and Furniss had their stakes in the partnership bought out by Joseph Tetley and his son. By this time its premises were at 31 Fenchurch Street. In 1888 the company established a sales agency in America.

Joseph Tetley & Sons was incorporated as public company in 1907, and as a private company a year later. By this time the company was a leading London wholesale tea dealer. By 1913 the American business had substantially expanded, and a subsidiary company was established in New York.

Joseph Tetley Jr died in 1935, with an estate valued at £75,000 (equivalent to £29.5 million in 2015). His nephew, William Tetley-Jones took over the company, but died just a few months later. The company was inherited by his son, Tetley Ironside Tetley-Jones (1912 – 1990).

In 1939 Tetley-Jones visited America where he encountered the growing popularity of the tea bag, as opposed to brewing with loose tea leaves. He pioneered mass production of the tea bag in Britain from 1940. Initially production was for export only, due to rationing in Britain.

In 1941 the London premises were damaged during the Blitz, and a new production facility was opened at Bletchley in Buckinghamshire. By this time the head office was at Mansell Street, still close to Mincing Lane.

In 1951 the company was converted back into a public company, with a share capital of £410,000 (£50.7 million in 2015). Net assets were valued at just under £600,000 (£74 million in 2015).

The end of rationing allowed Tetley-Jones to introduce the tea bag to the British consumer in 1953. Tetley-Jones spearheaded the initiative, and had to fight the scepticism of his board of directors. The head tea buyer for Brooke Bond, the largest tea company in the world, announced that his company would never produce tea bags, which he believed imparted the taste of paper to the product.

In 1958 the Bletchley plant was sold off, and all production was centered at a new factory at Eaglescliffe in County Durham. The same year, a new factory was opened at Williamsport, Pennsylvania. Total company capital rose to £750,000 (£58 million in 2015).

Tetley-Jones believed that the company was too small to compete against larger companies such as Brooke Bond, and had been searching for a buyer for years. In 1961 Tetley & Co was acquired by Beech-Nut Life Savers of New York for £2.3 million in cash (£148 million in 2015). Whilst a leader in the small UK tea bag market, most company profits came from the American subsidiary.

Beech-Nut Life Savers provided the capital necessary for expansion of production and marketing of the tea bags. By 1964 tea bags had taken five percent of the British tea market, and all of production belonged to Tetley. It was only that year that the major tea packers introduced their own tea bags.

Tetley tea bag sales grew 58 percent to the catering trade, and by 41 percent to the domestic trade in 1965. The company was exporting millions of tea bags every year.

Tetley tea bag sales rose 63 percent to a total of two billion bags in 1967. Tetley held two thirds of the retail market for tea bags, and 50 percent of the catering market.

In 1968 Tetley sold 5,000 tonnes of tea bags. By 1969 Tetley had 65 percent of the British tea bag market.

In 1973, J Lyons, the British catering giant, and a major tea producer itself, acquired Tetley for £23 million (£524 million in 2015).

The “Tetley tea folk “advertising campaign was launched in 1973. Tetley introduced the round tea bag in 1989. In 2000 Tetley was acquired by Tata, an Indian conglomerate, for £271 million.

Tetley is the third highest selling tea brand in Britain, with a 16 percent market share as of 2016.

Note: all current day wealth calculations are measured as a percentage of GDP, and are taken from measuringworth.com

Top tips: Typhoo tea

Typhoo has been one of the highest selling tea brands in Britain since the 1930s.

William Sumner (born c. 1796) established a grocery business with an emphasis on tea, at 96 High Street, Birmingham in 1820. In 1852 it passed to his son John Sumner Snr.

John Sumner Jr (1856 – 1934) joined the family business after leaving school, and began to package and market a blend of tea leaf tips from 1903. Packaged tea was a relatively unknown item in Britain at the time, as the product was generally sold loose from shops.

Previously the market had been dominated by whole leaf tea, and the tips had been discarded. Sumner successfully marketed the tips as a cure for nervousness and an aid to digestion under the brand name Typhoo Tipps. He derived the Typhoo name from a Chinese word meaning doctor.

Sumner divested the grocery business in 1905 and founded a private company to produce and market his packaged tea. A factory was established at Castle Street in Digbeth, Birmingham. Rapid expansion occurred with assistance from aggressive marketing.

Sumner established a blending operation in Ceylon in 1909. This allowed him to buy directly from growers, thus saving costs by cutting out the middleman.

Sumner retired in 1926 and dedicated much of the rest of his life to philanthropy. The business was taken over by his son, John Richard Hugh Sumner (1887 – 1971). The factory was relocated to Bordesley Street, also in Digbeth, in 1930.

Typhoo tea was sold in over 40,000 outlets by the early 1930s, making it one of the highest selling packet teas in Britain.

u_20260840_Half Moon Bay_Magnets_typhoo-tea-fridge-magnet

Operations ended in Ceylon in 1933, after it was discovered that the Ceylon agents were overcharging the company for inferior tea.

John Sumner died in 1934 and left an estate valued at £740,041.

Wartime bombing damaged the company factory in Birmingham in 1941. With reconstruction materials scarce, limited production was relocated to Brooke Bond and J Lyons for the remainder of the war.

Typhoo was incorporated with a capital of £750,000 in 1949. This figure was increased to £1.1 million in 1954.

A £22 million takeover bid by Kraft of Chicago was rejected in 1960. Typhoo held around 15 percent of the British tea market throughout the 1960s, behind Brooke Bond and the Co-op, and alongside J Lyons.

Sumner retired in 1966 and the managing director, Henry Claude Kelley (1897 – 1974), became chairman.

Typhoo began to manufacture tea bags from 1967. Due to its late entrance, rival companies such as Tetley and Brooke Bond already had firm footholds in this increasingly significant market.

Typhoo was acquired by Schweppes, the soft drinks concern, for £45 million in 1968. Schweppes intended to utilise its strong marketing skills and global distribution network to increase Typhoo sales. It was almost a merger of equals, with Typhoo shareholders holding around 40 percent of the combined entity.

Schweppes merged with Cadbury in 1969. Immediately, Cadbury Schweppes considered relocating Typhoo production to their large factory in Bournville, but the low potential resale value of the Digbeth site meant that the proposal was discarded at that time.

magnet-t-for-taste-typhoo

The 160,000 sq ft factory in Digbeth, Birmingham employed 550 workers when it was closed in 1978. All the workers were offered alternative employment by Cadbury, who had significant operations in the area. The closure occurred as the Birmingham site was unsuited for conversion to high-speed production.

Production was relocated to Moreton, Merseyside, which had been acquired by Cadbury in 1953 as a biscuit production plant.

Typhoo was subject to a management buyout in 1986, and the company became known as Premier Brands. That year Melrose, the Scottish tea business, was acquired.

Typhoo was acquired by Premier Foods in 1990. In a marketing-led industry, the brand lacked an advertising campaign with the memorability of the PG Tips chimpanzees or the Tetley tea folk. By 1993 its share of the tea market was down to three percent.

Premier Foods sold Typhoo to Apeejay Surrendra Group of India for £80 million in 2005.

Manufacture of Typhoo tea still takes place at Moreton, where 260 people are employed. The factory is the largest packer of own-label tea in the UK, supplying all but one of the major retailers.

Typhoo placed fifth in the British tea market in 2015, with around ten percent market share.

A history of the largest tea companies in Britain

The highly competitive nature of the British tea industry has seen a number of different market leaders emerge at different points in time.

Horniman & Co was the first company in the world to package tea (as opposed to loose-leaf sales by grocers). By 1867 they claimed to have the largest stock of tea in Britain in their warehouses. By 1880 they sold over 5 million packets a year. By 1890 they had export sales of 500,000 lbs a week.

By 1892 Horniman had been overtaken by Mazawattee, who sold over 14 million packets of tea each year. Mazawattee had introduced a brand that was blended entirely from fashionable Ceylon tea leaves. They also advertised more heavily than Horniman.

By 1897 Lipton & Co claimed the largest sales of tea in the world, with one million packets sold each week. Lipton had acquired their own tea plantations in Ceylon, and by cutting out the middleman, were able to offer lower prices to the consumer.

In 1903 John Sumner began to package a new blend which used only the tips of the tea leaf. With the distinctive name of Typhoo, it had lower tannin levels and a higher caffeine content, Sumner claimed digestive properties for his product.

By 1915 J Lyons & Co sold 5 million packets of tea each week, and were far and away the market leader in Britain, stocked in 160,000 outlets. In 1922 they claimed that 7 million people drank their tea every week.

In 1923 the Co-operative Wholesale Society (CWS) claimed that it was the largest tea business in the world, with a sale of over 60 million lbs of tea every year. By 1932 this figure had increased to 100 million lbs a year.

In 1939 the CWS was the largest tea blender and distributor in the United Kingdom, controlling around 25 percent of the supply. It was followed by Lyons, Brooke Bond and Allied Suppliers (who controlled Lipton).

CWS tea sales declined with the rise of the supermarket chains: the new chains saw CWS, who operated their own grocery stores, as a rival, and refused to stock their tea.

By 1957 Brooke Bond was probably the largest tea company in the world, with around one third of the British and Indian tea markets.

In the 1960s, Tetley grew from a minor player to a major force in tea after it pioneered the use of the tea bag in Britain.

Brooke Bond was still the largest tea company in the world when it was acquired by Unilever in 1984. Unilever had acquired Lipton in 1971.

Today Lipton is the largest tea brand in the world, with most production centered on a single site in Dubai.

A potted history of Twining & Co

Twining’s is sold in over 115 countries, and is the leading premium tea brand in the world.

The Twining family originated from Gloucestershire, and often found employment in the weaving industry. Recession in the trade led Daniel Twining to migrate to London with his family in 1684. In 1706 his son, Thomas Twining (1675 – 1741), acquired Tom’s Coffee House on Deveraux Court, at the back of 216 Strand. The shop was well-sited to serve the aristocracy.

The Twining tea shop on the Strand, central London.
The Twining tea shop on the Strand, central London.

As well as coffee, Twining began to sell the rare but fashionable tea. Twining was supplying tea by royal appointment to Queen Anne by 1711. In 1717 Twining acquired the Golden Lyon at 216 Strand: the company still trades from the same premises today. Coffee had been phased out in order to focus on tea by 1734.

Thomas’s son, Daniel Twining, took over the business, and by 1749 was exporting tea to America. Between 1762 and 1782 the firm was run by Daniel’s widow, Mary Twining.

In 1782 Richard Twining took over the company’s management. In 1784 he advised the Prime Minister, William Pitt the Younger, to dramatically reduce the tax on tea to reduce smuggling. Tea sales subsequently quadrupled.

In 1787 Twining introduced its current logo, reputedly the oldest commercial logo to be in continuous use since its inception.

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In an 1814 letter, Jane Austen revealed herself to be a Twining tea customer.

The company also developed a substantial banking arm, and in 1824 it was established as a separate entity.

In 1838, Twining received a Royal Warrant from Queen Victoria. It has held a Royal Warrant from each successive British monarch ever since.

Twining exclusively used tea from China until 1839, when they also began to use tea from India and Assam. From 1879 Ceylon tea began to be used.

From the eighteenth century until the late nineteenth century, staff in the shop wore swallow tail coats and white ties. Moustaches were banned.

The Twining bank struggled to compete as rivals grew larger, and in 1892 it was acquired by Lloyds Bank.

Twining survived by keeping up with modern developments. Also, Twining & Co was fortunate in that family members who ran the company had all been excellent businessmen. Also, unlike many other tea companies, Twining’s never owned tea plantations, which meant that it wasn’t tied to its own producers, and could select the best tea crops each year.

Following the acquisition of the tea interests of Harrisons Crosfield of Bankside in 1916, a private company was incorporated as Twining Crosfield. The company had a share capital of £50,000. It was likely the second largest tea blending company after Brooke Bond.

In 1941 part of the Twinings shop and the entire back premises were destroyed by the Luftwaffe. Business continued throughout the war, although the damages necessitated that administration was relocated to Vincent Square in Westminster, followed by the Minories in the City of London, until the premises were rebuilt in 1953.

In 1952 Twining became a public company with a share capital of £400,000. The company employed a staff of 450, and had net assets of almost £525,000. Manufacturing premises were at Wellclose Square, with floorspace of over 42,000 sq ft. There were also smaller factories at Belfast and Staffordshire. As well as the Strand location, the company operated shops at Wigmore Street and William Street, Knightsbridge.

Twinings undertook advertising for the first time in 1956. This move was prompted by the rise in sales of branded teas such as PG Tips.

In 1964 Twining was acquired by Associated British Foods in a friendly takeover. ABF, controlled by George Weston, beat a hostile takeover from Beech-Nut Life Saver of New York, who bid almost £2 million. Beech-Nut had planned to merge Twining with its own Tetley Tea operation. ABF vowed to maintain the business as it had been run before.

The main plant in southeast London was struggling to cope with demand. In 1966 production was relocated to a new plant in Andover, Hampshire that cost almost £3 million. Across seven acres, it was one of the most modern automated factories in the world, and employed 700 workers.

In 1970 an additional factory was opened at North Shields in the northeast of England.

A dedicated marketing manager, Brynley Evans, was brought in from Rank Organisation. In 1973 he became managing director.

By the 1970s Twining’s tea had strong sales overseas. Japan and France were the leading export markets, whilst American sales continued to grow strongly, with a 55 percent rise between January and October 1971. Meanwhile the company gained distribution in British supermarkets with its speciality teas such as Earl Grey.

By October 1974 Twining was the second largest supplier of black tea in Japan, with 32 percent of the market.

Company turnover in 1976 was over £18 million. Between 1969 and 1976, export sales more than quadrupled to £8 million, and Twining was exporting to over 80 countries. The company blended and packed 23 different types of tea. Twining was the biggest British buyer of tea from China. Twining supplied 26 percent of all the tea consumed in France.

In 1980 Twining opened a $6 million tea manufacturing facility at Greensboro, North Carolina, its first such plant in America.

By 1983 annual export sales had reached £17 million. By this time Twining was a brand leader in Japan.

By 1984 Twining was Britain’s largest exporter of tea to America. Earl Grey was the company’s bestseller worldwide.

The Greensboro plant was closed in 2005, with the loss of 90 jobs.

In 2011 Twining closed their North Shields factory and halved the workforce at the Andover plant, and moved all export production to Swarzedz, Poland. Nearly 400 jobs were lost in Britain. Twining also applied to the European Union for €12 million in investment grants to assist with the relocation, but this was denied.

Twining is the second highest selling brand of tea in the UK as of 2016, with a market share of 20 percent.

Monkey business: Brooke Bond

Brooke Bond was the largest tea company in the world. Its PG Tips product is the highest selling tea in the UK.

Arthur Brooke (1845 – 1918), was the son of a tea dealer from Ashton under Lyne, Lancashire. He trained at the wholesale tea firm of Peek Brothers & Winch at Liverpool, and later London.

In 1869 Brooke opened a shop in Manchester, selling tea, coffee and sugar. He traded as “Brooke, Bond & Co”. A Mr Bond was never involved in the business, and Brooke simply liked the sound of the name.

Brooke took cash payments only, at a time when almost all groceries were sold on credit. Within three years he had opened shops in Liverpool, Leeds and Bradford. In 1872 he moved to London where he opened a blending warehouse on Whitechapel High Street. He distributed his own tea to ensure freshness.

Trade depression in the 1870s forced Brooke to sell his London and Scottish stores, and convinced him to pursue the wholesale business.

Brooke introduced a profit-sharing scheme for his 154 employees from 1882. Brooke was an early adopter of this quite revolutionary practice. By 1891 the scheme had accounted for an average of a 10 percent bonus every year.

In 1892 Brooke Bond was converted into a limited liability company with a share capital of £150,000. By this time the business was mostly wholesale. A four-storey warehouse was acquired in Leeds; it had floor space of 54,000 sq ft.

In 1894 Brooke Bond had a 1/30th share of the British tea market. By 1897 it was claimed that two million Britons drank Brooke Bond every day. By 1902 the company had 500 staff and 30,000 sales outlets.

In 1910 the company relocated to Goulston Street in Aldgate, London.

Brooke retired as company chairman in 1910, and was succeeded by his son, Gerald (1881 – 1969). In his obituary, The Times described Arthur Brooke as a “model employer”. He pioneered the eight hour working day, and paid higher wages than his competitors.

By 1917 Brooke Bond was a leading tea blender. In 1923 Brooke Bond opened a large factory at Trafford Park, Manchester, to serve the northern market.

In 1924 Brooke Bond acquired 1,000 acres at Limuru, Kenya, where they established plantations. Together with James Finlay & Co, the two companies pioneered tea production in East Africa.

In 1932 Brooke Bond acquired the Red Rose tea brand in Canada.

The mid-market PG Tips brand was launched in 1930. Brooke Bond Dividend Tea was launched in 1935. Dividend was the company’s value product, and each packet offered the chance to win cash prizes.

Gerald Brooke retired as chairman in 1952. Under his tenure the company’s tea packet trade had multiplied twenty times. He was succeeded by his son, John Brooke (born 1912), a high-powered, resilient man.

In 1954 turnover exceeded £68 million. The majority of sales came from quarter pound packets of tea, of which one thousand million were sold throughout the year.

Chimpanzees were first used as actors in television advertisements for PG Tips from 1955.

The Secret of The Tea Chimps

By 1956 over 100 million cups of Brooke Bond tea were drunk worldwide every day, and the company had overtaken Lyons to take the largest share of the British tea market.

By 1957 Brooke Bond was probably the largest tea company in the world, with a one third share in both the British and Indian tea markets. The company owned thousands of acres of tea plantations, more than any other tea distributor. There were five blending and packing factories in the UK. Company vans made deliveries to over 150,000 shops in Britain.

In 1958 the head office was relocated to Cannon Street, London. By this time the company had interests in Britain, India, Pakistan, Ceylon, Canada, East Africa and South Africa.

Brooke Bond was still highly traditional. Agents regularly attended the tea auctions in Mincing Lane, London, with the time-honoured cries of “I want some” and “am I in it?” However it also kept with the times. Its annual advertising budget totalled $3 million. Total sales in 1962 were $318 million.

By 1963 Brooke Bond owned 30,000 acres of tea plantations, located across India, Ceylon and Africa. The company sold six brands of tea, marketed across 80 countries. 65 million cups of Brooke Bond tea were consumed in India every day. Its Red Rose brand was the market leader in Canada.

In 1965 Brooke Bond employed approximately 50,000 people. In 1966 Brooke Bond claimed to be the largest growers, manufacturers and distributors of tea in the world. In 1968 Brooke Bond held 36 percent of the British tea market.

In 1968 Brooke Bond acquired Leibig, who owned the Oxo stock cube and the Fray Bentos canned meat brands, for £36 million. The merger created the sixth largest food company in Britain, and was to prove a great success.

By 1969, 100 million cups of Brooke Bond tea and coffee were drunk every day in India. By this time the company employed 12,000 people on its Kenyan tea plantations.

In 1970 Brooke Bond acquired Haywards Pickles, alongside other smaller brands, from the Melbray Group for £1.5 million in cash.

By 1972 Brooke Bond held 40 percent of the British tea market. PG Tips was the brand leader in tea with a 20 percent share, while Dividend held 12 percent.

In 1980 The Times credited the chimpanzee advertisements with taking PG Tips from number four in the British tea market in 1956 to number one.

In 1984, Unilever, the Anglo-Dutch consumer goods giant, acquired Brooke Bond for £389 million in cash in a hostile takeover. Brooke Bond was the world’s largest tea producer at the time, and held 31 percent of the British tea market. Unilever already owned the Lipton tea business.

Haywards Pickles was sold to Hillsdown Holdings in 1989. In 1993 the Fray Bentos brand was sold to Campbells Soup.

As of 2015, the Trafford Park factory in Manchester is the third largest tea factory in the world. PG Tips is still the highest selling tea in Britain, with a market share of 23 percent. The brand has lost market share in recent times to higher quality rivals Twining and Yorkshire Tea.

The Brooke Bond name is no longer in use in Britain. Brooke Bond’s Choicest Blend was latterly sold by Typhoo, but it was discontinued in the 2000s. PG Tips no longer carries the Brooke Bond name. Brooke Bond remains a major brand in India and Pakistan.

Plain sailing: Lipton tea

In 2015, Lipton was the highest selling tea in the world, with distribution in 110 countries.

Thomas Lipton (1846 – 1931) was a Glaswegian grocer. Lipton believed that he could broaden tea’s appeal to the working classes if he could lower its price. In 1890 he cut out the middleman by acquiring cut-price tea plantations in Ceylon (now Sri Lanka). Lipton passed the savings on to the customer.

By 1897 Lipton claimed to have the largest sale of any tea in the world “beyond doubt”, and millions drank his tea every day. Over one million packets of Lipton tea were sold in Britain every week. In 1897 Thomas Lipton paid a record-breaking £35,000 duty on a week’s purchase of tea. This was over half the average for the total weekly tea market, which Lipton now claimed to dominate. By this time his tea enjoyed a Royal Warrant from Queen Victoria. Several thousand workers were employed on his Ceylon plantations.

By at least 1899, Lipton tea was blended differently for different regions, in order to suit the local water.

By 1907 Lipton had received a Royal Warrant from Edward VII. The Ceylon estates for tea, coffee and cocoa covered thousands of acres.

By 1918 Lipton tea could boast thousands of outlets in Britain. By this time the Lipton company had been awarded the Royal Warrant as tea merchants to George V.

By 1924 Lipton could refer to the yellow packaging of his tea as famous. The company claimed to be the largest tea distributors, manufacturers and retailers of food products in the world.

However by 1926 the company was in bad shape. The company had outgrown the overworked Thomas Lipton, however he refused to take advice from his board of directors. He was forced to resign from the company he had built in 1927, and his stake was acquired for £60,000.

Lipton was acquired by Home & Colonial, a large grocery chain, in 1931.

Thomas Lipton died in 1931. He left a British estate valued at over £1.4 million. He left an American estate valued at £757,000.

In 1944 Lipton divested some of its plantations in Ceylon, but retained 3,400 acres of high quality tea estates.

Supermarket chains grew from the 1950s. These chains were reluctant to stock the product of a rival grocer. Lipton tea sales in Britain declined and never recovered, and the company concentrated on its significant tea sales overseas.

By 1968 Lipton had total coverage of the Indian market. The company built a new fully automated factory of over 175,000 sq ft. It was one of the world’s largest tea packing and blending factories.

By 1969 Lipton tea was sold in 156 countries, and 29 factories packed Lipton tea.

In 1972 the Lipton tea interests were acquired by Unilever, the Anglo-Dutch consumer goods giant, for £18.5 million.

By this time Lipton was a relatively small player in the British tea market, and was outsold by two Brooke Bond brands (PG Tips and Dividend), as well as Tetley, J Lyons, Typhoo and the Co-operative Wholesale Society. Lipton did however have a highly successful business in the United States.

By 1979 all Lipton tea was packed and blended at a factory in Leighton Buzzard. It was the largest tagged teabag factory in Europe. In 1979 Lipton was awarded the Queen’s Award For Export. Lipton Yellow Label was the highest selling tea in the world, a blend of Ceylon, India and other tea leaves. By 1980 Lipton exported more tea to more countries (over 120) than any other company.

By 1984 Lipton’s market share in Britain was described as “minuscule”.

The Leighton Buzzard factory was closed in the late 1990s, and production was relocated to a site in Dubai. The Dubai site is now the largest tea factory in the world.

Lipton Yellow Label has a very small presence in the UK, and most British people will be more aware of it from trips overseas. In the UK its most popular line is its ice tea soft drinks.

 

So long, Ceylon: Mazawattee Tea Co

Mazawattee was the highest selling brand of tea in the world.

John Boon Densham (1815 – 1886) was a Plymouth chemist who moved to Croydon in the 1860s. With a Mr C Lees he formed Lees & Densham, wholesale tea dealers at Philpott Lane, where the bulk of Britain’s tea auctions took place.

In 1870 Lees divested his stake and the firm began trading as John Densham & Sons. With premises at Eastcheap in London, the firm grew to become a sizeable concern. By the 1880s they had also established a warehouse in Manchester.

In 1886 John Densham & Sons introduced the Mazawattee Tea blend. It was made entirely from Ceylon leaves, which were marketed as superior to the standard Chinese leaves. The trademark was registered the following year.

Packaged tea had been introduced by John Horniman in the 1840s, but most tea at this time was still sold loose from grocers’ shops. Packaged tea promised a consistent product, and was a vouch for purity from contamination.

By 1892 over 14 million packets of Mazawattee tea were sold every year, through 5,000 outlets. By this time sales had overtaken those of Horniman, who had led the market since at least the 1860s.

A seven storey factory had been erected at Tower Hill, London by 1894. In 1896 the Mazawattee Tea Company was formed with a valuation of £550,000 (about £66 million in 2015). John Densham’s sons, John Lane (1853 – 1918) and Benjamin (1847 – 1929), were joint managing directors.

By 1896 Mazawattee tea was the largest tea brand in the world. By 1898 Mazawattee was the largest wholesale tea business in the world. In one single auction the company had to pay the largest ever tea duty, £63,147, after it acquired 1,687 tons of tea.

In 1900 Mazawattee again broke the record for the highest duty paid on tea (£85,862 in 1900), when they acquired over 5 million lbs of the good in a single transaction.

In 1901 a new plant was built at New Cross, and the firm diversified into chocolate confectionery. It was the largest and best equipped tea processing plant in the world. The factories and warehouses covered over four acres, and over 1,000 workers were employed. The relocation, including new machinery, represented an investment of over £400,000 (around £45 million in 2015).

In 1901 the company had a share capital of £800,000 (around £88 million in 2015). By 1902 this had risen to £1 million, with assets excluding goodwill valued at over £650,000.

By 1905 millions of people drank Mazawattee tea every day, and the company had over 15,000 outlets in the United Kingdom.

By 1900 the J Lyons tea shop chain had expanded to over 50 outlets. In 1904 the Mazawattee board decided to open 500 small shops at a cost of £200 each. Two board members, R A McQuitty and J H McLean, were placed in charge of executing the operation. They acquired only 164 teashops, but at an average cost of £500 to £2,000. Some cost as much as £4,500 and £10,000. Some annual rents were over £1,000 a year. Furthermore, the shops made serious profit losses from the start. An extraordinary meeting was called in 1905. McQuitty and McLean were immediately sacked and all the shops were quickly divested, but by then total losses amounted to nearly £300,000. Mazawattee came very close to collapse, and in attempt to save money it had to severely reduce its advertising expenditure.

The chocolate and cocoa business showed its first profit in 1907.

Unlike Lipton, Mazawattee never owned any tea plantations. They argued that this left them free to choose the best tea at auction, but it also left them vulnerable to fluctuations in commodity prices.

By 1913 much of Ceylon’s agricultural land had given way to the far more profitable rubber plantations. As the output of Ceylon tea was reduced, Mazawattee was forced to make up the difference with tea from India and Java. The only other option would have been to push wholesale prices to untenable levels.

John Lane Densham retired as managing director and chairman in 1916, and Alexander Jackson (1857 – 1936) took over his roles.

In 1917 Mazawattee was likely the third largest manufacturer of packet tea, after J Lyons and Horniman & Co.

In 1936 Joseph Densham (1883 – 1961) took over as chairman. That year the decision was taken to abandon the confectionery business.

Both the company factories were destroyed by air raids during World War II. The offices were transferred to 52 -54 Leadenhall Street. As late as 1948, the company was denied licence by the government to rebuild its factories. As such, Mazawattee  was produced by Brooke Bond until 1952.

In 1953 Mazawattee was sold to Burton, Son & Sanders, confectioners of Ipswich. The freehold factory at New Cross was sold to Johnson & Phillips, electrical engineers, for £190,000, and production was moved to premises at Thomas Street, Limehouse.

From this juncture Mazawatee was sold as an economy brand in outlets such as Woolworths. The brand ceased to be produced in 1965 and Densham & Sons was liquidated in 1967.

The brand was revived in 2016 by a new business, the Mazawatee Tea Company.

Horniman: inventor of packaged tea

Horniman & Co was likely the largest tea firm in the world throughout much of the latter half of the nineteenth century. It was the first tea producer to package the product individually, at a time when tea was bought loose from a grocer.

John Horniman (1804 – 1893) was a Quaker from Reading, England. The Horniman family had emigrated from Germany to Devon in the 15th century. Quakers often promoted temperance products such as tea and sweets.

Horniman had established himself as a tea dealer in Northampton by 1825. At this time, tea was a luxury good, mainly consumed by the rich. Tea consumption in England rose rapidly from the 1840s onwards. The business was based on the Isle of Wight by 1846.

Horniman & Co was relocated to Philpot Lane in London in the late 1840s. The site was chosen due to its proximity to Mincing Lane, where tea auctions were held. The business had moved to Dalston Place by 1851. A warehouse was opened at Wormwood Street, also close to Mincing Lane, in 1854.

horniman

At the time, tea was sold loose by grocers. As such, it was frequently subject to adulteration by unscrupulous vendors. Horniman was the first to package his tea in individual packets by 1851. It was branded as Horniman’s Pure Tea.

The influential Dr Hassall of The Lancet vouched for the purity of Horniman’s product in 1859. Theirs was the only Chinese green tea examined by The Lancet that was found to be free of added colourings, which were used to disguise poor quality.

The British government reduced the duty on tea in 1864. Horniman’s passed on the savings to the customer by lowering the price of their product. There were 2,280 outlets for their product by 1864.

The Horniman & Co warehouse contained the largest stock of duty-paid tea in London in 1867. Over 12,000 sq ft of warehouse flooring was constantly in use.

John Horniman retired in 1869. His son, Frederick John Horniman (1835 – 1906), took over management of the firm. A dynamic man, Frederick was intelligent and likeable.

Horniman’s Pure Tea had  a strong export market by 1876, with high sales in Europe. The success of the firm was built on a dedication to quality, keen prices and strong marketing.

The tea warehouse on Wormwood Street burned down in 1879. The tea, on which duty had already been paid, was completely destroyed. The fire caused between £100,000 and £150,000 worth of damage (between around £11 million and £17 million in 2015 prices). Temporary premises were quickly arranged, and the firm was able to draw upon its tea reserves, so that only a few days of production were lost.

A new six-storey warehouse was built on the same site in 1880.  By this time the firm had an annual sale of over five million packets of tea, and 4,000 outlets.

Previously the sole proprietor, Frederick Horniman took on his son, Emslie Horniman, as well as S R Brewerton and others as partners in 1889.

Horniman & Co was the largest tea firm in the world by 1890. Tea packet labels were printed in nine different languages. Over 5,000 chests of tea, weighing 100lbs each, were exported each week.

The founder, John Horniman, died in 1893. He had given generously to charitable causes throughout his life, but still left a personal estate of £320,000 (£37 million in 2015). His will donated much of his wealth to good causes.

Rival manufacturer of packaged tea, Mazawattee, had decisively overtaken Horniman in sales by 1892.

Horniman & Co sold ten million packets of tea annually by 1893. Tea was sourced from India, China and Ceylon, and only the young spring growths were used.

To house the artefacts he had amassed during his travels around the world, Frederick Horniman opened the Horniman Museum in Forest Hill, London, in 1890. He donated the museum to the public in 1901, and it remains a leading London attraction.

Horniman tea was sold at over 10,000 outlets by 1903.

Frederick Horniman died in 1906 with an estate valued at £421,628.

The business was taken over by his son, Emslie John Horniman (1863 – 1932).

Horniman & Co was acquired by J Lyons & Co, the leader in the packet tea market, in 1918 . Lyons wished to grow their own tea sales in the North of England, where Horniman was strong. Lyons opened the largest tea packing factory in the world at Greenford on the outskirts of London in 1920.

Emslie John Horniman died in 1932 with an estate valued at £317,605.

Horniman was marketed as the Lyons premium tea brand by the 1970s. It was their highest seller in South Wales. However the brand was eventually withdrawn from sale in Britain.

The brand is now owned worldwide by Douwe Egberts. In Spain, Hornimans leads the hot tea market with a 25 percent share. It is also available in Spanish-speaking South American markets. In Italy, Royal Tea traces its origins to Horniman & Co.

Lyons led by donkeys: the fall of a British empire (1950 – present)

Part I, about the early history of J Lyons, can be found here.

In the early 1950s, Lyons was the largest catering company in the world, with a capital of £10 million and exports to fifty countries. In 1954 there were 33,000 employees and 230 tea shops.

In 1951 the Corner House restaurants and hotels alone employed over 4,000 workers. On normal Bank Holidays the Corner Houses could expect to serve 250,000 meals.

Lyons engineers developed LEO (Lyons Electronic Office), the first business computer in the world. Large computers had previously only been used for military or scientific purposes. The 5,000 sq ft computer began use on 17 November 1951, and calculated stocking levels. From 1954 it calculated the bakery staff payroll.

Lyons introduced the American-style hamburger chain to Britain when it opened a Wimpy franchise in the basement of a Lyons tea shop on 277 Oxford Street in May 1954. By 1973 there were 1,100 Wimpy outlets in 34 countries.

Lyons Pure Ground Coffee was the highest selling coffee in Britain in 1953. Lyons launched its standard market teabag brand, Quick Brew, in 1955.

By 1956 a Big Four held 70 percent of the British tea market. Lyons held second place behind Brooke Bond.

Maryland Cookies were introduced in 1956. The company launched Ready Brek instant porridge in 1957, to outstanding success.

In 1961 Lyons divested its confectionery business to Callard & Bowser. With the growth of television advertising, middle-size sweet manufacturers had been forced to consolidate in order to reach a scale capable of launching their own campaigns.

In 1962 Lyons took most of its tea distribution vans off the road. The vans had delivered to independent grocers throughout the country. The company had reasoned that business was transferring towards the supermarkets. The decision was premature however, and allowed rival Brooke Bond to increase its market share.

By 1963 a joint venture with Schweppes, Rose Kia-Ora Ltd, was a leading soft drinks supplier in the UK, with 46 percent of the UK squash market.

In 1963 Lyons acquired Eldorado of Liverpool, the fourth largest ice cream manufacturer in Britain, and rebranded its ice cream business as Lyons Maid. The takeover took its share of the ice cream market to 34 percent, and Lyons was the second largest ice cream manufacturer in Britain (after Wall’s) throughout much of the twentieth century. The FAB ice lolly was introduced in 1967. The Greenford ice cream factory was the second largest in the world by 1973.

The computer division required extensive capitalisation, so it was sold to English Electric in 1964.

By 1966 Lyons had become the biggest supplier of pre-packaged cakes in Britain, and was the clear market leader with a 28 percent market share.

In 1966 Lyons had more than two thirds of the packaged ground coffee market.

Throughout the 1960s J Lyons was joint third in the British tea market alongside Typhoo, with around 15 percent market share, behind Brooke Bond and the Co-operative Wholesale Society.

By 1969 Lyons was probably the largest in catering sales and supplies in Britain.

In 1970 Lyons was the brand leaders in ground coffee. However its market share in tea was 13 percent, and it was far from the brand leader it once was. Quick Brew had a 8 percent share of the popular tea market. It was strongest in the South of England, especially London, where it held 17 percent of the market. By this time Horniman and Black & Green had been positioned as the company’s premium tea brands. Horniman was the company’s biggest tea seller in South Wales, and Black & Green was strong in Manchester and the North West.

In 1970 Lyons hotels held over 6,000 beds.

In 1968 it was argued in The Spectator that “You can grade the Lyons properties into four classes — redundant, non-profitable, underdeveloped — and Cadby Hall.” By 1969 the number of tea rooms had declined to 120, and many were loss-making. The Coventry Street Corner House closed in 1970. Between 1970 and 1972 the tea rooms were converted into Jolyon Restaurants.

Cadby Hall was closed in 1972, with production relocated to Yorkshire and Northamptonshire. Nearly 3,000 staff were affected.

In 1972 Lyons acquired Tetley Tea for £23 million. This gave Lyons the second highest market share for tea in both the British and American markets. In Britain Lyons now had 17 percent of the tea market, behind Brooke Bond on 40 percent.

Fox’s Biscuits of Batley was also acquired in 1972. In 1973, the ice cream manufacturer Baskin Robbins, with 1,600 stores in America, was acquired for £16 million.

Lyons encountered financial difficulties following the global oil crisis of 1973. In the early 1970s they had borrowed £250 million to finance acquisitions, mostly from non-British sources. Foreign loan repayments became expensive as the value of sterling fell. As a result, the company began to rapidly divest its core assets just to meet is liabilities.

In 1974 J Lyons dropped from the top 100 companies in Britain by market capitalization. In 1975 the company had capitalization of £39.5 million and a turnover of £249 million.

The tearooms and corner houses fell prey to the more trendy coffee bars of Charles Forte, as well as the increasing appeal of fast food and ethnic cuisine. The last tea shop closed in 1976.

In 1976 the 35 British hotels (with the exception of Tower Hotel) were sold to Rocco Forte’s Trust House Forte for £27.6 million. Forte promptly recouped £11 million in a year by cutting costs.

Also in 1976, Wimpy, with 676 UK outlets, was sold off to United Biscuits for £7 million.

In 1976 the Salmon and Gluckstein families were forced to relinquish voting control over Lyons. By allowing ordinary shareholders to have votes, they hoped to acquire more capital, which was desperately needed. Previously the families had had 6 to 7 percent of company equity but 61 percent of voting shares. By this time Lyons had a market capitalization of  over £40 million and sales of £650 million.

In 1978 Lyons was subject to a friendly takeover by Allied Breweries which valued the company at £64 million. The merged entity was known as Allied Lyons. The Cadby Hall sites were demolished in 1983.

The remant Lyons food businesses were sold off throughout the early to mid 1990s.

Ready Brek was sold to Weetabix in 1990.

Lyons Maid had been loss-making for several years, mainly due to increased competition following the entrance of Mars into the ice cream market. It was sold in 1991 to Clarke Foods for £12 million. There were 800 employees in Greenford, Middlesex and Liverpool. In 1992 Clarke Foods was acquired by Nestle.

In 1994 the Lyons coffee businesses were divested: ground coffee to Paulig of Finland and instant coffee to Philip Morris.

In 1994 after acquiring Pedro Domecq, the company renamed itself from Allied Lyons to Allied Domecq.

1994 also saw Lyons biscuits of Blackpool sold to Hillsdown Holdings. There were 780 employees.

In 1995 Lyons Cakes was sold to Tomkins of America for £35 million. The business employed 1,700 people in Britain and Ireland. Meanwhile, the Tetley Tea business was subject to a management buyout, valued at £190 million.

Lyons Quick Brew tea is still found in the UK, although distribution is extremely limited. Lyons Red Label tea can be bought from Waitrose. Lyons remains the highest selling tea brand in Ireland, with over a third of the market. Lyons Maid has been re-branded as Nestle. Lyons brand cakes, biscuits and freshly ground coffee are still sold, although without the presence they once had.

Lyons’ major weakness was nepotism. As late as the 1950s, the board was populated exclusively by family members. The Financial Times ran a headline “Too much Salmon is bad for Lyons”. A non-family member chairman was not elected until 1977. Although a public company, the majority of voting shares were controlled by the founding families until 1976. But by then, it was too late to save the company extant.