Tag Archives: Thomas Lipton

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.