PRESENTATION BY: SICILY KARIUKI (Mrs),MBS MANAGING DIRECTOR TEA BOARD OF KENYA January 2012

1. KENYA TEA MARKET DEVELOPMENT PRESENTATION BY: SICILY KARIUKI (Mrs),MBS MANAGING DIRECTOR TEA BOARD OF KENYA January 2012

2. CONTENT • Introduction-The Kenya Tea Industry • Supply, Demand and Trade Situation • Distribution Channels • Market Share Analysis • Economic Factors Affecting Demand • Non-Economic Factors Affecting Demand • Market Promotion-Types and Impacts

3. INRODUCTION-KENYA SUPPLYING TEA TO THE REST OF THE WORLD(OVER FIFTY DESTINATIONS WORLDWIDE

4. Planted Area

5. Kenya tea Production

6. The Kenya Tea Industry-Growth drivers Overall growth realized as a result of: • Consistent High quality • Ongoing Research and Development and Physical investment. • Responsiveness to global requirements. • Facilitative process and structures(Public and private) • Developed infrastructure. • Efficient distribution channels.

7. Kenya Tea Imports

8. Apparent Consumption *Apparent Consumption- locally produced and imported tea

9. Tea manufactured from tea leaf by Tea Factory In the form of loose tea in bulk package In value added form Directly to overseas Buyers (direct export) Through public tea auction To registered Primary buyers To domestic consumer through Retail outlets Directly to overseas Buyers as Direct export To merchant packers for sales to Domestic consumer as packet tea To domestic consumer Through retail outlet and FDS Distribution Channels To domestic consumer through secondary buyers

10. Market Share Analysis-Type of Outlets

11. Market Share Analysis-Type of product

12. Economic Factors Affecting Demand • Price of tea • Inflation & Disposable income. • Price of additives such as milk and sugar.

13. Non-Economic Factors Affecting Demand • Population • Weather Conditions (cold/hot). • Consumption habits (Not considered an all time drink). • Competition from other beverages (cold/hot) • Product presentation. • Family size and age.

14. Non-Economic Factors Affecting Demand • Perception (“tea is for the old Generation”) • Promotion

15. Market Promotion-Types and Impact • Local Generic Promotion-Promotion of tea as a lifestyle drink/health platform. • Branding of tea through Mark Of Origin. • Exploring New/Emerging markets.

16. Market Promotion-Types and Impact (Prospects for market expansion) • “Out of home” settings. • Focus on the growing youth segment. • Urban working class women • East Africa Community/COMESA

17. Market Promotion-Successful experience. • Introduction of ice tea in Kenya to capture the ‘consumers on the go” • Increased popularity of flavored tea. • Increase in demand for instant tea. • Gradual establishment of the tea drinking culture.

18. Local Generic Promotion

19. Local Generic Promotion

20. INTERNATIONAL TEA FOR HEALTH MARATHON Where the world’s finest athletes and the world’s tea meet.

21. Local Generic Promotion AWARDING EXCELLENCE IN THE TEA SECTOR IN KENYA DURING THE NATIONAL TEA DRINKING DAY.

22. KENYA TEA MARK OF ORIGIN, 22 ISO 9001:2008certified

23. Tea Board of Kenya, P O Box 20064 -00200 NAIROBI Telephone: +254-20-3874446; +254-20-2536886; +254-20-2536869 Cell phone: +254-722 200556; +254-734 600944 Fax: +254-20-3862120; +254-20-3876337. Email info@teaboard.or.ke Website: www.teaboard.or.ke CONTACT 23 ISO 9001:20008certified