Britain's Oldest Tea Brand Faces Collapse
Typhoo Tea, one of Britain's oldest tea companies, is on the brink of administration due to significant financial challenges. The company has filed a notice of intention to appoint administrators, granting it five days to find a buyer before potentially ceasing operations. During this period, Typhoo continues to trade while exploring rescue options, with administrators from EY prepared to step in if necessary.
Founded in 1903 by Birmingham grocer John Sumner, Typhoo was once among the UK's best-selling tea brands. However, recent years have seen a decline in sales, dropping from £34 million in 2022 to £25 million in 2023. Concurrently, losses have escalated from £9.7 million to £38 million. The company attributes these financial difficulties to shifting consumer preferences, with many opting for coffee, energy drinks, and other beverages over traditional tea.
In addition to changing market trends, Typhoo faced operational setbacks, including a break-in at its Merseyside factory in August 2023, resulting in extensive damage to machinery and tea stock. This incident delayed the sale of the factory, which was eventually completed in June 2024, further contributing to the company's financial woes.
Despite these challenges, Typhoo's chief executive, Dave McNulty, stated that the action to file for administration is intended to facilitate the pursuit of a sale of the business. The company remains hopeful that a buyer will emerge during the notice period, potentially averting formal administration and allowing the brand to continue its operations.
Typhoo's situation reflects a broader trend in the retail sector, where several established brands have faced financial difficulties amid changing consumer behaviors and economic pressures. The outcome of Typhoo's efforts to secure a buyer will determine the future of this historic tea brand.
