Delhi-based start-up Brewhouse Ice Tea, which secured $2.6 million funding from Singapore-based FMCG firm Food Empire Group last year, is looking to raise around $2-3 million by the end of this fiscal.
According to Siddharth Jain, founder and CEO, Brewhouse Ice Tea, the company has been growing by over five times, annually. While the funds will take care of its growth for the next couple of months, it might need to raise additional capital in the next six-eight months.
The company, which started operations in May 2017, has sold about one million bottles of flavoured ice tea so far.
“We are looking to sell around 5 lakh bottles a month and hope to achieve that this year. Capital is sufficient for now, but we might go in for next round of fund raising after six-eight months,” Jain told BusinessLine.
The total beverage market in India is estimated to be around $10 billion and ice tea has the potential to occupy 5 per cent of the market. It currently contributes a small percentage to the total market, the demand for ice tea has been growing steadily.
Expanding product range
Brewhouse currently has four flavours, including citrus green, classic lemon, classic peach and honey mint, and plans to add four more — masala, forest berry, mojito lime and jamun berry tea — keeping in mind health conscious milenniels.
The brand, present in over 4,500 stores across 10 cities including Delhi, Chennai, and Bengaluru, is looking to reach out to 10,000 stores by the end of this fiscal.
The company has tie-ups with over 500 restaurant and cafe partners for distribution of its brand.
“Our products go well with all types of cuisine, hence we enter into tie-ups with hotel chains, restaurants and cafes. Nearly 30 per cent of our sales comes from institutional tie-ups,” he said.
Raw material
For raw material, the company has entered into an understanding with two estates in the Nilgiris in south India for procuring their entire production of organic tea. The company is open to entering into more such tie ups with tea estates in Nilgiris. “Tea produced in the Nilgiris is ideal for producing ice tea,” he said.
“We have entirely contracted two tea gardens in Nilgiris which produces close to two-three2-3 tonnes of organic tea a month. We may need more quantity of organic tea as we scale up moving forward. So, we are open to entering into tie ups with tea gardens,” he said.