Innovation

Since their introduction in the US, many milk tea companies have been scrutinized by US health organizations as a result of the sugar levels and ingredients in traditional milk tea drinks. Kung Fu Tea has integrated formulations that decrease sugar levels while supporting taste by sourcing real fruit and real juice for their beverages. Additionally, Kung Fu Tea has integrated smoothies and other desserts containing yogurt and aloe as healthier options. The tea itself is one of the top consumed beverages here in the United States however, carbonated sodas have remained in the lead for decades. Kung Fu Tea began with a passion for Asian culture and later expanded to collaborate with fast food chains in the US to provide healthier options to consumers. As part of their corporate culture, global headquarters are open to innovative fresh ideas and this expansion with a focus on health led to the growth of the organization. Sourcing real fruit and real juice have allowed Kung Fu Tea to tailor their drink formulation to support populations such as the elderly and young children. An example of this is a zero sugar formulation that still provides great taste and the benefits of oolong, green and white tea antioxidants. Kung Fu Tea supports the UN SDGs of good health and well-being (SDG #3) in this manner. In addition, Kung Fu Tea team believes that a healthy option starts with the first healthy choice and becomes a lifestyle after that. Kung Fu Tea is an equal opportunity global employer that also supports gender equality (SDG #5) in the workplace. This is also carried over into the UN SDG #8 of Economic Growth designation as it provides anyone with the franchise with an opportunity at a global scale.

Inspiration

Based in New York City, NY, the company has expanded to other countries to include Australia and Canada with over 170 store locations. The founders Michael, Allen, and Ray after returning from Taiwan wanted to have a taste of the bubble tea that they enjoyed while growing up in Taiwan. The founders discovered a restaurant in NYC but were disappointed because it didn’t give them the authentic flavor and experience they were used to. At that moment, the innovative idea and the innovation to bring bubble tea to the USA came to mind. They wanted to create a bubble tea franchise in the USA but also wanted to create a fearless leading tea brand that promotes healthy tea culture. They also wanted to promote gender equality by having young and motivated people in their organization while also providing a decent work environment and economic growth. Michael, Allen and Ray’s bright idea led them to reach out to their friend Sean, in Taiwan, who had a talent in business and a taste for bubble tea. After sharing their ideas with Sean, he first was skeptical and unsure of how the business proposal would work but, after a few days, Sean gave his consent. Ten years later, the business is still growing thanks to the founders that have created a company with “patience, endurance, and passion”.

Overall impact

As an owner of the Kung Fu Tea Fort Lee store, Jackie Lee, with the support of the founders, provides innovative ideas to bring Western and Eastern culture together. As a Taiwanese style milk tea store, corporate headquarters contract with suppliers in Taiwan to support the purchase of authentic products rather than obtaining supplies from a cheaper local supplier. Kung Fu Tea makes a great impact on the American culture, market, and environment.

On the short-term, they bring the Taiwanese food culture to America and integrate the bubble tea into local culture to create brand-new products. Mr. Lee has integrated some of the traditional recipes for customers who want to get closer to the Asian experience in addition to providing many seasonal drinks to relate to locals and keeping with American holiday traditions. For example, they promote a pumpkin side drink on Halloween which is a combination of pumpkin flavor and Oolong milk tea.

Furthermore, Kung Fu is about discipline and patience, so they put effort on focusing and pioneering the use of actual tea leaves in their brewing process. The difference between these two cultures became the biggest challenge and the biggest selling point for the store. As a result, Mr. Lee’s store, and the 170 other locations have integrated healthy alternatives to replace soft drinks, heavily caffeinated coffees, and high caloric desserts. Although Kung Fu Tea sells Asian beverages, their culture is one of inclusivity and their product line is as diverse as the company’s customer base. The products have been tailored to diverse groups of people. For example, beverages can be adjusted by decreasing the sugar level for older populations. Additionally, if there is a preference for sweeter drinks the company has measurements to support such tastes. The company has very much integrated itself into the lifestyle of its consumers in a world of ritual and social media exposure.

Business benefit

When discovering and documenting additional quantitative data, we found concrete evidence of the business impact when looking at sales promotions, items of the month and introduction of digital-based technologies such as apps to support sales. As a result of new creative or seasonal items, sales can increase as much as 30 percent. In addition, the buy one get one free health promotions double monthly sales trends. Inventory has increased 100 percent to about $20,000 a month in inventory for the Fort Lee store. Mr. Lee describes the experience in the store as “unmatched and hard to match”. Proving “their investment to the customers' health each customer is known by their first name and it is not written on the side of their cups as seen in major coffee franchises” sales have increased significantly.

Additionally, the company’s selection has grown to over fifty drinks with different formulations for personal customization. Additionally, the company has added smoothies, juice, yogurt, custard, and aloe as an ingredient to its customized beverages. With the introduction of the digital app rewards, as a consumer marketing conversion strategy, Kung Fu Tea is able to incentivize and impact more customers by drawing them to a healthier lifestyle promoting tea culture and the demand for real fruit and real juice as opposed to processed fruit and carbonated drinks here in the United States. As a company that promotes a culture of “young, fresh, innovative and fearless” ideas and strategies, it seems that Kung Fu Tea will continue to expand and impact the globe as a healthy cultural force.

Social and environmental benefit

As consumers are becoming obese and ill due to food choices, Kung Fu Tea has taken the opportunity to convert these consumers into choosing healthy options. Initially started in China Town in New York City, Kung Fu Tea partnered with fast food chains to provide healthier options to carbonated drinks. With much success in the conversion of consumers, Kung Fu Tea was able to expand. Bringing such a traditional Asian beverage to the US market with changes in content and delivery has proved to be extremely innovative. In a culture of coffee and carbonated drinks, Kung Fu Tea is part of the movement that has transitioned 87 percent of the millennial population to the population of tea drinkers. According to Tea USA, drinking tea can offer significant health benefits including “reducing the incidence of cardiovascular events, slowing the progression of diseases, lowering LDL cholesterol and improving blood pressure”. In addition to these diagnoses, cancer and neurological diseases are also impacted by tea and fresh fruit consumption.

Source: Tea Association of U.S.A. Inc; teausa.com

http://www.teausa.com/14655/tea-fact-sheet

Interview

Mr. Meng Chen Lee, Owner (Fort Lee Store)/Account Manager