How To Start A Milk Tea Business in the Philippines: Almost everyone in the Philippines loves milk tea. It’s cold, it’s sweet, and it has a variety of flavors that can capture even the most meticulous taste buds.
Milk tea originated from Hong Kong but is actually influenced by the British, given that they stayed for quite a while in the region. It is usually comprised of black tea and evaporated or condensed milk, unlike the traditional Chinese tea which is usually served plain.
With its growing popularity among all ages, many are wondering: how does one start a milk tea business in the Philippines? In this guide, we’ll tackle the demand and supply of milk tea, how much is the capital, how to choose the best location, the expected daily sales, and lastly, what is a great marketing strategy when you want to start a milk tea business in the Philippines.
How To Start A Milk Tea Business in the Philippines
1. Research your recipe
Starting a milk tea business isn’t something you can just do overnight – it requires careful planning and lots of consideration. For starters, find out what flavor your target market prefers. Take note that your target customers have their own unique taste when it comes to their beverages, and just because some like coffee-flavored milk tea, doesn’t mean everyone else would like it too.
Plan what flavors of milk tea you will be serving, but do not exaggerate your menu. While it is great to offer a wide array of choices, offering too much would mean that you will have to invest in lots of ingredients without actually knowing if your target consumers would like it in the first place.
2. Always be original
The milk tea business is a flourishing venture which means that it is hard to come up with something “original” nowadays. Always remember that you need to have something that will set you apart from your competitors. Offer your customers unique flavors and interesting concepts. It may seem like everything else is already taken, but trust us when we say that there are still lots of ideas just waiting to be brought to life.
3. Build a good customer relationship
Live by the mantra “our customer is our greatest asset”, because, without your customers, your business wouldn’t even take off in the first place. Find out what your customers like, what makes them happy, and offer them not only good quality products but outstanding customer service as well.
4. Treat your staff well
Aside from your customers, your staff will help keep your business going. Do not treat them merely as your “employees” but as investments, because an employee who feels appreciated will always do more than what is expected of them.
5. Go legit
Make sure that your business is registered and that you have all the necessary permits and licenses before you operate. This will protect your business and of course, your amazing ideas and recipes from being stolen by copycats.
Additional Milk Tea Stages For A Business In The Philippines
- Choose A Profitable Location
- Networking & Marketing
- Accepting Several Forms Of Payment
- Business Plan And Strategy
- Growth Systems
- Budget Building And Allocation
- Stock, Equipment, And Resources
Demand And Supply Of Milk Tea In The Philippines
The demand and supply of milk tea in the Philippines is booming. As a matter of fact, the retail prices of the tea market in 2015 totaled around 55.20 million (USD). Until the year 2025, the demand and supply of milk tea in the Philippines is forecasted to reach up to 109.79 million (USD) at retail prices.
The popularity of milk tea in the Philippines is definitely undeniable, and it is forecasted to remain so in the years to come. As proof, you may look around and you’ll notice that shops and kiosks selling this popular sweetened treat are mushrooming in malls, public transport stations, commercial centers, schools, and food bazaars.
Best Location For Milk Tea Business
Another important thing you have to do is find the best location for your milk tea business in the Philippines. This is a critical step since your store’s location can either make or break your venture. If you are looking to have customers spend more time inside your shop, then you can choose a busy area with high foot traffic and a huge parking space.
If in case you are planning on investing in a truck so you can travel to various locations, make sure to scout the area and find out what the best time is to reach your intended customer base. Make sure to conduct research and find out the history of your desired store location. If the area has a high crime rate, is prone to flooding, or has undergone several business turnarounds, then your chosen location might not actually be the best option for you.
If you are having a hard time finding the best location for a milk tea business in the Philippines, then maybe you can consider setting up your business from home. By doing this, you can save lots of money because you won’t have to lease a commercial space, you won’t have to worry about leaving your store every night, and you can work on your business full-time while managing other businesses or working freelance.
Capital For Milk Tea Business Philippines
The capital for a milk tea business in the Philippines depends on how big you want your store to be, and what type of recipes you are planning to offer. If you want to start your own milk tea shop from scratch, you will need about Php 30,000 to Php 300,000 (rough estimate only).
You can also try to franchise instead of starting your own brand from scratch. As of this writing, some of the milk tea businesses that offer franchising includes:
- Macao Imperial Tea – Php 1.5 million
- Gong Cha – Php 1.5 million
- Serenitea – Php 1.7 million
- ChaTime – Php 2.5 million
Equipment Needed For Milk Tea Business
Some of the equipment needed for a milk tea business in the Philippines is as follows:
- Tea Brewing Machine
- Cup Sealing Machine
- Stove or Table Burner
- Cooking Pot
- Measuring Scoop
- Tapioca Container
- Dome Lids
- Cups and Lids
- Shaking Cups
- Water Dispenser
- Cash Register
- Oversized Straws
If you decide to set up your business from home, then you wouldn’t have to spend much on equipment needed for milk tea business. Since other tools like a strainer, water dispenser, blender, and stove are readily available, the only things you would have to spend on are the packaging equipment and some supplies like the cup sealing machine. Now if you’re on the lookout for suppliers, here’s a quick guide on how to find suppliers in the Philippines.
Expected Daily Sales Of A Milk Tea Business in the philippines
On average, start-up businesses usually price their milk tea at Php 80 to Php 100 per cup. Let’s say you sell at least 50 cups a day since you are just starting out. Putting the price at Php 80 (to be conservative) would mean that you can earn at least Php 4,000 per day. That’s Php 28,000 per week or Php 112,000 to P120,000 per month!
Of course, don’t forget to deduct the expenses you will incur like the additional electricity costs and the price of your packaging and other supplies.
Marketing Strategy For Milk Tea Business in the Philippines
After you have figured out the demand and supply of milk tea, the best location, the capital needed, the various equipment needed, and the expected daily sales of a milk tea business in the Philippines, it is now time for you to plan a great and foolproof marketing strategy for milk tea business.
Utilizing social media channels like Facebook, Instagram, and Twitter is definitely the easiest and most cost-effective way to promote your business. If you aren’t that tech-savvy and don’t know how to create ads on social media, then you can always hire freelancers who can do them for you at an affordable price.
If you are tech-savvy, you can create your own website with your menu, prices, store address, and promotions displayed on the landing page. Aside from that, you can also opt for the help of influencers. Most of the time, all they require are free products or services in exchange for promoting your product and business.
Of course, at the end of the day, word of mouth is still the best play off the books. By giving your customers quality products and outstanding customer service, they will promote your business to their family and friends without you even having to ask.
We hope that by now, you have gained a deeper understanding of how to start a milk tea business (Philippines). Remember that money isn’t the only investment you’re going to have to put in – you will also need to invest your time, a lot of patience, dedication, and perseverance.
At the end of the day, starting a business has never been easy. Don’t forget that every big business you see now once started from a piece of paper and was brought to life by taking calculated risks and by making huge amounts of sacrifices.