Backgrounder Koala Tea Thrives article by sanmelody



Koala Tea Thrives
Reporter: Joanne Shoebridge
First Published: 16/3/2003

Sixteen years ago organic herbalists Howard and Elle Rubin swapped their little piece of
paradise in Northern Wales, for a new nirvana in Northern New South Wales.

"It was a combination of terrible climate, terrible politics and the Chernobyl nuclear
disaster, which pretty much affected our property," Howard said.

"There was a Chernobyl cloud that came over the area we were living in Northern Wales,
so the writing was on the wall it was time to leave."

"When we showed up in Australia there was no herb growing industry, there was almost
no organic growing industry at the time and we were really surprised about that, and so
our number one task was to establish a herb growing industry, and we did that by setting
out a one-acre herb farm ourselves and running a weekend courses to see if there were
other people who wanted to enter the herb growing industry with us," Howard said.

When Landline last visited the Rubins in 1994, they'd established one of the few fresh
herb companies in Australia using a network of small growers they trained themselves.

“The idea was that it would be single desk marketing and they would market through us,
but the nature of human beings is that they were all going direct to the marketplace and
before we knew it we had 100 competitors instead of 100 cooperatives, so we decided
that we needed to carry on a herbal tea business, we needed to carry on with a value-
added product so we launched the Koala Tea Co at that point," Howard said.

At this compact Alstonville factory, the Koala Tea Company is now turning over more
than a million dollars a year - about $600 thousand of that generated from overseas sales.

The company produces 23 varieties of herbal infusions and flavoured tea; all organic, and
all Australian.

"The actual tea comes from Northern Queensland, from the Atherton Tablelands, and
because herbs require so many different types of climates we're getting them from all
over Australia," Howard said.

"I mean the best mint we can get comes from Tasmania which has a nice cold winter,
we're getting our lemon balm from our local region here, were getting our chamomile,
our lemon grass from Queensland, we're getting chicory from Victoria, so were targeting
the particular regions that will best sustain those crops."

Bob McIntyre has known the Rubins since the early days when the couple founded the
Organic Herb Growers Association.

From his property west of Lismore, he's grown Echinacea and culinary herbs for the
Rubin’s, now he's their main supplier of Australian native lemon myrtle, harvesting
plants on his own and six other properties.

The plants are stripped by hand. A team of four can strip half a tonne of leaves in a day.

"You just grab the whole thing and they all come off, they come off quite easily," Bob
McIntyre said.

He says lemon myrtle is popular with tea makers because of its intense lemon smell.

"They don't have to use anywhere near as much with the lemon myrtle as they as the
other plants with the lemon essence, they can just use a minimal amount and get the same
flavour or even a stronger flavour you know so it's ideal," Bob said.

As well as tea, lemon myrtle is distilled for its oil for cooking and cleaning products. A
mature tree produces about 10 kilograms of leaf.

"There's a hundred grams or a bit over there, so it takes a lot of leaf to actually get that
hundred grams out by the time you dry it down you get less than half," Bob said.

He says it sells for anywhere between $10 and $25 a kilo, depending on what it's being
used for.

In a twist to the old adage of taking tea to China, the Koala Tea Company is now
blending lemon myrtle with black tea to sell to India.

The company's biggest customers are Singapore, Malaysia, Indonesia and Hong Kong,
with product also being sold in French Department stores, and British and American
health food stores. Despite being the first herbal tea sold in an Australian supermarket,
Koala Tea has a limited distribution at home.

"We have more supermarket shelf space in Singapore than we do in Australia, we export
to 10 countries all over the world and we're recognised as a really great Australian
product overseas, more so than we are here in Australia," Howard said.

It's in the gift market that Koala Tea has found its niche.

After being pushed off Australian supermarket shelves by the bigger tea companies, the
Rubins began selling their product to Japanese tourists through duty free stores and
catalogues. They didn't have the money to spend on marketing so they designed the boxes
to sell themselves.

"The product itself was the point-of-sale advertising, so we put Australian names on it, I
mean No Worries Tea, Dreamtime Tea, we put Australian icons koalas sleeping in trees
things like that," Howard said.
But if the Australian supermarket scene was difficult for a small locally grown product to
break into, the cafe market has been even harder.

Koala Tea sells to several cafes in Sydney and Melbourne; most cafes are buying major
brand names which produce herbal, organic and flavoured teas cheaply overseas.

The herbal and flavoured teas segment is growing at 11 per cent a year.

The first producers were small independent companies targeting a health conscious
minority. However the traditional black tea producers responded quickly to the growing
popularity of alternative teas. They extended their range, and now dominate the market.

Tea - which comes from the Chinese camellia plant - is the second most popular drink in
the world after water.

Australians buy more than $263 million worth of tea every year. Of that, herbal infusions
are worth $29.5 million or 11 per cent, flavoured black tea is worth $2.6 million or 1 per
cent and green tea is worth $10 million or 4 per cent.

Domestically Koala Tea has had its greatest success in health food stores.

The health food sector is growing in Australia, but slowly. It's offshore that Koala Tea's
founders believe the company’s future lies.

"After all Australia is a small market - we're only 19 million people and how many of
those actually drink tea," Howard said.

"But when you go into Los Angeles there’s 19 million people in that market alone. It's a
major city for us Los Angeles. You look at some of the other markets that are open to us
and they're enormous."

But while the company is on track to grow, decisions about further expansion might just
have to wait for the next generation - daughter Freya and son-in-law Simon are already
an integral part of the business.

"We can take it just so far me and Elle and it's nice to know there's young blood, new
ideas, creative blood coming into the business," Howard said.

"It's a lifestyle decision, we've always been alternative, we've always been pioneers.

"I think we were the first herbal tea business in Australia to actually get on the
supermarket shelves and make a go of it, we're one of the few herbal tea companies to
export around the world, and we're enjoying ourselves, it certainly has been a lifestyle

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