Industry
and market analysis
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Bubble tea business is increasingly growing in the United
Kingdom. It is seen more in the cities' streets. Bubble tea is said to have
originated from Taiwan in the 1990s. There are two categories; milk tea and tea
with no milk. Due to the increased demand for beverages not only in the UK but
also around the world, the bubble tea market is growing and gaining popularity,
taking the place of tea and coffee which were the traditionally consumed
beverages. The vital ingredient making up bubble tea is tapioca pearls/balls
which are added to tea. The balls are for flavor purposes (Fröjdö, 2018). Bubble tea is
expected to grow significantly in the globe.
According to a forecast done for 2019 to 2026, the bubble tea business market was valued at
close to 2 Billion US dollars in 2019 and it is predicted to get to close to
3.5 Billion US dollars in the year 2026. The analysis has demonstrated a
compound annual growth rate of approximately 9%. This report shows that the
bubble tea business is promising and venturing into the business at this time
is a good decision as the UK shifts into organic food products.
Due to the demand for bubble tea by consumers, companies
in this business have launched a wide range of varieties of bubble tea flavor.
These include boba kopi-C, boba brown sugar milk tea, boba milk tea, midnight
blue and another one known as asboba caramel milk tea. Secondly, companies are
opening chains to take care of increasing demand. The encouragement to the
growth of bubble tea businesses is the growing consumption of beverages like
tea and coffee. Moreover, bubble tea has a lot of health benefits. It is known
for its low-calorie content. Besides, black tea which is mainly consumed has
anti-inflammatory attributes. This could orchestrate the consumer demand for
people with a health-centric lifestyle (Tea, 2014). In the coming years, the Bubble tea business will
exceptionally grow judging from the health benefits it possesses.
Bubble tea, being a beverage business is
influenced by several political environmental factors. When starting a business
in UK the government will require one to register it, acquire insurance covers,
to with laws of data that ensures safekeeping of personal data of the
employees, checking employees right to work before employing them failure to
which you could risk a heavy penalty and fines adding up to 20,000 Euros for employee,
submit a written statement of terms and conditions of employment, ensuring a
health and safety policy and enrollment of an employee earning more than 10,000
euros and above 22 years of age in a pension scheme. Besides, the business has
to pay taxes. With the outbreak of coronavirus in China this year 2020,
movement restrictions to Taiwan to get raw materials used in bubble tea is a
negative impact on the bubble tea business. Lastly, the UK is a Political stable
kingdom thus creating a good environment for business establishment and growth
(Peng, & Nunes, 2007, July).
The society in the UK is shifting into organic
food products, affecting the consumption of bubble tea. Most people in London
prefer black tea to other categories of tea due to health benefits accrued to
it. Therefore, black tea is more popular. Companies are also producing
different flavors to satisfy different consumer diverse preferences. Vegan is
flavor is gaining popularity and most like. And thus in our business, we shall
major on that.
Technology plays a major role in business; it could be
through automation of processes as a marketing tool. The UK is technologically
developed with at least 67% of the whole population is active in social media
use in 2019 (Peng, & Nunes, 2007,
July). With this kind of information, I suppose using social and
internet to market bubble tea business will be effective. This will be through
platforms such as YouTube, Instagram, Facebook, LinkedIn, Twitter, Google,
Pinterest, and TikTok. Furthermore, an E-commerce website for the business can
be developed to automate the sales and also as a medium of marketing where all
products are accessed. Through social media Digital marketing to make the
business more visible can take place. Digital marketing advertises digital
channels and the business can easily reach a wider market. Implementation of
the right technology into business results in increased sales improved
communication and gain competitive advantage.
The UK has is an economic leading country as
number 5 according to the 2018 report. As a result of Brexit drawbacks 2008 and
2009, there a recession and had been recovering slowly. The inflation rate as per 2019 September was
1.7%. The UK is a popular destination for investments in several fields. The
corporate tax rate currently, is 19% and it is expected to go down to 18% by
April 2020. The UK has a large population and hence can allow even small
markets to be profitable. In addition, the UK has a free market (Peng, & Nunes, 2007, July).
It is an accurate time to venture into the
bubble tea business. I believe with years the business will so much boom in the
UK. With the increased demand we can be sure of making a profit easily. And
finally with consideration of all factors discussed earlier there is no big
barrier enough to prevent establishing a bubble tea business.
References
Fröjdö, H. M. (2018). Feasibility of a bubble
tea shop in Jakobstad: Market acceptance of bubble tea.
Tea, B. (2014). Bubble Tea Toppings. Teaching
Science In Culturally Relevant Ways: Ideas From Singapore Teachers, 35.
Peng, G. C. A., & Nunes, M. B. (2007,
July). Using PEST analysis as a tool for refining and focusing contexts for
information systems research. In 6th European conference on research
methodology for business and management studies, Lisbon, Portugal (pp.
229-236).