Trade Tea Margin Guide: Pricing, Cost-per-Cup, and Volume Planning

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TL;DR — Your Margin Targets

• Aim for 75–82% gross margin on tea and chai by the cup.
• Use a dose-driven cost-per-cup (grams and landed $/kg) instead of “menu guesswork.”
• Protect margin by keeping waste under 5% and batching consistently for iced/RTD service.
• Price ladders: Core hot vs iced/batch vs signature. Each rung has a reason.

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1) Start With Cost-Per-Cup (CPC)

Formula: `CPC = (Dose in g ÷ 1000) × Landed $/kg × (1 + Waste %)`

Example: 6g dose, $48/kg, 5% waste → `(6/1000) × 48 × 1.05 = $0.30 CPC`

• Hot chai/tea: $0.22–$0.35 CPC
• Iced/batch: $0.26–$0.40 CPC (larger dose or concentrate)
• Signature/LTO: $0.30–$0.50 CPC

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2) Price Ladder That Makes Sense

• Core Hot: $4.75–$5.50 (CPC ~30¢). Anchor item, high attach.
• Iced/Batch: $5.50–$6.25 (CPC ~35¢). Higher perceived value + extra ice/milk.
• Signature/LTO: $6.00–$6.75 (CPC ~45¢). Seasonal, flavored, topped, or served in better glassware.

Keep the differential visible: iced +$0.75, signature +$1.25 over core. It guards margin and sets guest expectations.

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3) Control Waste

• Standardize doses (scales or portion scoops).
• Log batch yields for iced; adjust ratios weekly.
• Cap “dial-in” time—two brews per shift, then lock.
• Train milk/ice ratios for chai lattes to avoid over-pouring.

Keeping waste at 3–5% is worth 2–4 margin points.

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4) Volume and Ordering Cadence

• Single site café: 500–900 cups/week → ~3–6 kg/week.
• Multi-site group: multiply by sites; align deliveries to 2–3 week cadence for freshness.
• Distributors: stock 4–6 weeks of turn; rotate lots seasonally.

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5) Menu Engineering for Tea

• Pair a house chai with one signature and one iced anchor.
• Add a seasonal LTO every 6–8 weeks; pre-cost it and pre-train.
• Keep one premium origin for upsell and retail tins near POS.

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Need help?

Share your volume and menu—we’ll run the numbers, propose price ladders, and ship a curated flight with brew specs. CTA: `/pages/quote-request`