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TOP TEA RETAIL TRENDS SURVEY

CORE CONFERENCE SEMINARSJUNE 24, 2011

DAN BOLTONEDITOR/PUBLISHERWORLD TEA NEWS

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CELL PHONE SURVEYPoll Everywhere is a simple text message voting application for live audiences. Vote by textingCODES (or Tweet ) in answer to questions on-screen. Poll results within the presentation will update in real time. Try it now.Text a CODE to 22333 | Tweet @poll and a CODE | Submit CODE to

http://poll4.com

World Tea Expo is:

Code 32563 Really cool! 54%

Code 32595 Really hot! 46%

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How To Vote via Texting. Use 22333 and put CODE in message.

1. Standard texting rates only (worst case US $0.20)2. We have no access to your phone number3. Enter CODE in message line (not subject line)

TIPS

EXAMPLE

32563 or32595

22333

32563

32595

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How To Vote via www.Poll4.com

Enter 5-digit CODE in window, click submit.

32563 COOL or 32595 HOTTIP

EXAMPLE

32563

32563

32595

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How To Vote via Twitter

1. CODE immediately follows @poll (one space between)2. Since @poll is the first word, your followers will not receive this tweetTIPS

EXAMPLE

@poll 32563 or 32595

32595

32563

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SELECT YOUR BUSINESS CODE• CODE (50 Show Responses as of June 26)

• 79706 |Tea Room/House 23%

• 79860 |Specialty Retailer 27%

• 79861 |Hospitality/Restaurant 0%

• 79867 |Mass Merchant 0%

• 79871 |Spa/Wellness Center 2%

• 79874 |Coffee House 10%

• 79882 |Web-based Store 19%

• 79897 |Supplier 4%

• 79898 |Distributor 6%

• 79919 |Manufacturer 8%

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79706 |Tea Room / Tea House79860 |Merchant Specialty Retail 79861 |Hospitality / Restaurant79867 |Mass Merchant

79871 |Spa / Wellness Center 79874 |Coffee House79882 |Web-only Tea Store79897 |Supplier79898 |Distributor79919 |Manufacturer

CODE

Responses appear in this frame in real tim

e.

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WHAT IS YOUR AVERAGE DAILY TICKET AMOUNT?

There is no universal formula to achieve retail riches.

Success demands brilliant execution of a million details from scheduling staff to social media marketing.

The first step is to consistently deliver great tasting tea.

A retailer’s next priority should be stocking, pricing and displaying offerings selected to establish a transaction average that will return gross margins of 50+ percent.

A common ticket average for tea retailers is between $20 and $25. The simple exercise that follows will invariably help boost sales.

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129298 | < $4129302 |$5 - $9129304 |$10 -14129305 |$15 - 19129308|$20 - 24129309|$25 - 29

129319|$30 - 34129322|$35 - 39129323|$40 - 44129333|$45 - 49129334|$50 - 54129335|$55 - 59

129339|$60 - 64129345|$65 - 69129349|$70 - 74129350|$75 - 79129351|$80 - 84129356|$85 - 89

129360|$90 - 94129365|$95 - 99

CODE

Resp

onse

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in t

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© World Tea Media

AVERAGE TICKET (50 SHOW RESPONSES AS OF JUNE 26)

Code 129302 < $4

Code 129304 $5 - $9 4%

Code 129305 $10 - $14 1

Code 129308 $15 - $19

Code 129309 $20 - $24

Code 129319 $25 - $29

Code 129322 $30 - $34 4%

Code 129323 $35 - $39 4%

Code 129333 $40 - $44 3%

Code 129334 $45 - $49 4%

Code 129335 $50 - $54 2%

8%

20%

16%

10%

26%

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HOW MANY SALES DO YOU TRANSACT DAILY?

Now let’s look at the impact of traffic on your top line.

Frequency matters. Every customer returning monthly brings you $300. That same customer visiting weekly brings in $1,300 annually.

You can gross a million on $25 transactions but it requiress150 customers a day, or 15 transactions per hour. Teavana averages a $36 sale for every visiting customer.

If you can increase your store’s ticket average to $45 the traffic count falls to a reasonable 70 customers per day.

A high transaction average enables the

American Tea Room to earn $1 million while

serving only 35 customers a day.

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CODES129767 | < 20129768 | 20-39129773 | 40-59129790 | 60-79129803 | 80-99129807 | 100-119129812 | 120-139129815 | 140-159

129816 | 160-179129840 | 180-199129841 | 200-219130809 | 220-239130811 | 240-259130812 | 260-279130813 | 280-299130816 | 300-319

231840 | 320-339231841 | 340-349231842 | 360-379231850 | 380-399231851 | 400-219231853 | 420-439231856 | 440-479231857 | 460-499

231858 | 480-499231859| 500-519231861 | 520-539231862 | 540-559231862 | 560-579231863 | 580-599231886| > 600232800| > 700

232802| > 800

Resp

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© World Tea Media

AVERAGE DAILY TRANSACTIONS (MAY 2011) (50 SHOW RESPONSES AS OF JUNE 26)

CODE 129767 <20

CODE 129768 20 - 39

CODE 129773 40 - 59

CODE 129790 60 - 79

CODE 129803 80 - 99

CODE 129807 100 - 119

CODE 129812 120 - 139

CODE 129815 140 - 159

CODE 129816 160 - 179

CODE 129840 180 - 199

CODE 129841 >200

0 %

10%

0%

0%

2%

0%

2%

0%

45%

19%

12%

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QUARTERLY RETAIL REPORTS

The information you just offered is extremely valuable.

A good case can be made for the tea industry to initiate a Quarterly Retail Tracking to establish benchmarks.

Anonymous third-party surveys conducted by phone (instead of internet or panel interviews) allow clarification and better control. This proven, unbiased method insures accurate data and the best representation of current market conditions.

Projections are based on in-store traffic, online orders and average ticket sales. Core survey questions establish pricing benchmarks, cost of goods averages and labor. Several questions can be used to explore developing trends with an eye for opportunities.

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This Power Point is the intellectual property of the presenter and copyrighted by World Tea East. Permission to print or disseminate all or part of this presentation is granted provided that the copies are not made or distributed for commercial advantage and that the title and authors of the presentation appear on the printouts. To copy

or disseminate otherwise, or to republish in any form, requires written permission from the authors and World Tea East.

Join us for the next trends update at World Tea East in Philadelphia at the Pennsylvania Convention Center Sept. 9-10. Visit www.worldteaeast.com to learn more.

Subscribe to www.worldteanews.com to learn about these trends in greater detail. This report is an annual collaboration. If you would like to share your observations about tea trends that impact retail sales please contact me.

Dan BoltonEditor/Publisher

(204) 788-1359dan.bolton@worldteanews.com