Percy Siganporia, Managing Director, Tata Tea Limited
“Our branded business accounts for about 83 per cent of our total revenues…With the acquisition of Tetley, Tata Tea, the largest integrated tea company in the world, has now become one of the largest tea marketing companies in the world.”
From the worldwide acquisition of Tetley in 2000, to turning around the profitability of the Packet Tea Division, building dominant regional brands like Kanan Devan, Gemini and Chakra Gold and launching plantation-packed polypacks in South India, Percy Siganporia, Managing Director of Tata Tea Limited, has led several crucial projects of the company. Today, Tata Tea is present in over 35 countries.
A graduate in Zoology from Loyola College, Chennai, he did PGDM in Marketing from XLRI Jamshedpur. Siganporia joined Tata Administrative Services in 1974. Since 1975, he has served Tata Tea in various capacities.
Speaking to Gokul Krishnamurthy of exchange4media, Siganporia talks about the Tata Tea success story. Excerpts: Q. Your packet tea brands are doing well. What are the steps you’ve taken for the segment?
We’ve achieved double-digit growth in the packet tea market when some ORG estimates have indicated a de-growth in the segment. We’ve focused on brands, and this also reflects in the way we’ve serviced requirements. Investing in innovations and a huge risk management exercise have helped. For example, our Tata Tea Gold Brand, in 14 months of its launch, has gained a market share of 1.8 per cent.
Q. How is the brand Tetley performing?
Tetley’s market share is growing in all places. Tetley is the second largest player in the international tea bag market. We’ve introduced the brand in Russia, Kazakhstan, Pakistan, Bangladesh and South Africa. With the acquisition of Tetley, Tata Tea, the largest integrated tea company in the world, has now become one of the largest tea marketing companies in the world.
Q. Could you comment on the open market for sourcing tea, globally?
Over a period of time, consumers will demand and reward people who service their requirements. Global sourcing will enable delivery of such offerings at lower costs and faster rates to consumers. Between such a situation and now is just a transition. The only caveat is the protection for agriculture and certain sections of society and this will impact the pace of change.
Q. Will the changes in the land lease in the Kanan Devan Hills affect the Kanan Devan brand?
Q. You have been with the company for over 30 years now. What do you think of employees shifting from one organisation to the other frequently?
It has been a personal decision to stay on at Tata Tea since 1974. There have been ups and downs but they are everywhere you go. As for job shifts, new people coming in to the company are actually good for the company. An organisation needs to be nimble enough to keep infusing fresh blood. It’s really not so much on individuals to see the organisation through as it is about processes with continuous improvement.
Q. You’ve recently re-launched Tata Tea Premium. What was the insight?
Tata Tea Premium is the largest selling packet tea in India. Besides, it is also the largest brand from the stable of Tata Tea. We re-launched Tata Tea Premium in 2005 with Sania Mirza and the brand slug ‘Taste Kamiyabi Ki’. We don’t use brand ambassadors per se. Sania reflected success and gave the brand a youthful appeal without mouthing it.
Q. You have spoken about institutionalised idle labour reward in the past. How do we avoid this?
Provided you can outsource to your advantage, there should be no scope for idle labour reward. There are certain areas where you find the lowest cost options for reliable sourcing. Take the case of Tetley in Canada. We have a business with lead market shares in the Black Tea and Special Tea categories. Unilever is at No. 2. Canada is a country of four time zones. How many people do you think are employed there? Eleven, in all. Efficiency in future will mean that the construct for outsourced services exists.
Q. What are the other areas of business of Tata Tea?
We export spices, such as black and green pepper and cardamom, and we have expanded our operations to enter the coffee segment. Tata Coffee Ltd. is a subsidiary and cures about 15 per cent of the total coffee produced in India. It was recently merged with Asian Coffee Limited, creating the largest coffee conglomerate in Asia.
Q. How much does the branded business contribute to Tata Tea’s revenues?
Our branded business accounts for about 83 per cent of our total revenues. We don’t see this changing substantially. We may see a 3-4 per cent rise subject to certain factors.
