Abstract:
Tea is one of the most popular beverages consumed worldwide (Chacko, Thambi, Kuttan, &
Nishigaki, 2010). According to the statistics provided by economic and social statistics, Sri
Lanka continues to retain in the position of being the third largest exporter and the fourth largest
producer of tea (Central Bank of Sri Lanka, 2015).The present study was conducted to identify
the factors affecting tea consumption among local customers in urban areas. The consumption
behavior of tea was studied in Ratmalana divisional secretariat area in Colombo district using
primary data. Data were collected using a structured questionnaire from 150 randomly selected
customers at different supermarkets and cafes. Multiple linear regression analysis was employed
to study the factors influencing the quantity of tea demanded (quantity of tea purchased) per
month by the sample respondents. The study was focused on nine factors ( age, family size,
family income, number of years of education, number of cups consumed per day, price, monthly
tea expenditure, advertisements and health awareness) with respect to the quantity of tea
purchased per month. The results revealed that 88.7% of the respondents were tea consumers and
only about 11.3% of respondents were non tea consumers. The consumers purchased on an
average about 756.39g of tea powder every month. Hence, they‟re willing to pay Rs. 99.67 on
average for 100g of tea. Age, family size, monthly tea expenditure and health awareness were the
most significant factors. Influence of advertisements was the least influential factor. 49.6% of
respondents were 19-30 years old and this was the age category that mostly consumed tea.
Watawala and Lipton were most preferred brands among the consumers. The findings of
empirical research suggested that people are more health conscious and are less likely to be
influenced by advertisements but rather be influenced by family members. There is a need for
integrated advertisement and sales promo especially for those brands that have low demand.
