Research Reports
Development Strategies of Green Tea Industry for Enhancing Competitiveness and Establishing Consumption Infrastructure
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AuthorPark, Moonho
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Publication Date2013.12.30
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Original
Research Background
With the increase of national income and the widespread well-being boom, the functionality of green tea as a health food has become known and led to the expansion of its consumption. Consequently, the green tea industry grew rapidly. Recently, however, the consumption of green tea has significantly decreased due to the development of alternative teas and the usage of pesticides. These factors have led to the decrease of green tea price, the reduced production, and the failures in farming. Nevertheless, the green tea industry has its significance as the sixth industrial type of the agricultural industry, effectively connecting industrial agriculture and culture. Moreover, the green tea industry can contribute significantly to the revitalization of the local economy based on the main producing places. Therefore, it is necessary to prepare for the plans to secure the competitiveness of the green tea business and to expand the consumption patterns through associating the tea industry with culture. Through the establishment of the strategies, the green tea industry should play a leading role as a new growth engine industry for the development of agriculture..
Research Method
In order to understand the basic statistical data regarding the green tea industry, this study used the data including the resources and previous study data from the Ministry of Agriculture, Food and Rural Affairs and the raw data from Statistics Korea. The problems and the major issues in the current green tea business were explored through hosting four symposiums with experts. The current status of production management was investigated based on the total of 260 farmers. In order to explore the consumption patterns and the factors in consumption, the surveys were conducted to 1,000 respondents in Korea and Japan, respectively. Through developing the supply and demand model by product items, the supply and demand of green tea for the medium- and long-term period were anticipated. With regard to the consumption part, diverse models were employed, including the Habit Formation Model and Ordered logistic regression model.
Results and Discussion
This study draws emerging problems and issues through empirical investigation of the current status and problems in each area of the green tea industry and through the prospect of the supply and demand. Based on these results, this study suggests measure to address diverse problems. The developmental plan for the green tea industry is to improve industry competitiveness and establish consumption culture for the development of the green tea industry. In order to achieve the plan, four basic directions are suggested: (1) improvement of the competitiveness in price and quality, (2) development of diverse products to meet consumer's needs and establishment of distribution system, (3) reinforcement of education and promotion and creation of tea culture, and (4) establishment of institutional support systems for developing the tea industry.
Based on aforementioned basic directions, the detailed development strategies are established as follows. Firstly, as consumers are mainly interested in safety and price, more effort should be put into restoring consumer trust through the promotion or experience of tea gardens. Since the price issues are closely related to the conditions of production infrastructure, it is required to improve the tea gardens in slope area, where production cost is high, to make them terraced or to secure flatland tea gardens. Also, the distribution of improved varieties of which quantity and quality is assured, should be expanded.
Secondly, when it comes to the quality improvement and the development of a wide range of products to meet consumer's preferences, the aforementioned objectives should be pursued by cooperative processing plants and institutes in each main producing place. Moreover, it is suggested to develop popular brands and to open direct sales stores and tasting places in each main producing place in order to increase the accessibility of consumers.
Thirdly, for the purpose of expanding the range of consumers, it is needed to support diverse activities to promote tea culture such as green tea class in collaboration with the Cooperative Tea-Producers Association and Korean Tea Masters Society. The demand of the tea leaves should be promoted through hosting World Tea Expo and encouraging the tea culture promotion activities. In particular, the main producing places should perform the role and function as a hub of tea industry and culture in conjunction with the local food movement.
Fourthly, in order to promote the systematic development of overall culture in the tea industry, the promotion plans including the tea industry and culture should be legislated to provide systematic support.
Researchers: Moon-Ho Park
E-mail address: mhpark@krei.re.kr
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