Out of Home Tea Market Size, Share, Growth, and Industry Analysis, By Types (Black Tea, Green Tea, Herbal Tea, Matcha Tea, Oolong Tea, Others), By Applications Covered (Quick Service Restaurants, Restaurants, Bars & Pubs, Hotels, Cafe/Coffee Shop Chains, Work Places, Outdoor, Others), Regional Insights and Forecast to 2033

Out of Home Tea Market Size

The Out of Home Tea Market was valued at USD 19,805.36 million in 2024 and is expected to reach USD 20,973.88 million in 2025, growing to USD 34,209.98 million by 2033, with a compound annual growth rate (CAGR) of 5.9% from 2025 to 2033.

The U.S. Out of Home Tea Market is experiencing significant growth, driven by increasing consumer preference for tea across quick-service restaurants, cafes, and workplaces. Rising demand for premium and organic tea options is also contributing to market expansion.

The out-of-home tea market is experiencing steady growth, driven by rising consumer demand for healthy and functional beverages. Herbal tea accounts for 23% of the market share, driven by its health benefits. Green tea consumption has surged by 18%, fueled by increasing awareness of antioxidants. Quick-service restaurants contribute to 35% of total sales, while café chains hold 28%. The demand for premium and organic teas is expanding, with matcha tea witnessing a 15% growth in adoption. North America and Asia-Pacific dominate, with urbanization and changing consumer lifestyles supporting market expansion.

Out of Home Tea Market Trends

Consumer preferences are shifting toward organic and specialty teas, with black tea leading at 40% of total consumption. Green tea follows at 25%, while matcha and oolong tea are gaining popularity. The café and coffee shop sector accounts for 28% of total sales, while bars and pubs contribute 12% as tea-based cocktails gain traction. Workplace consumption is increasing, holding a 10% market share.

The demand for RTD (ready-to-drink) tea is surging, contributing 22% to the out-of-home segment. Premiumization is another major trend, with high-end teas experiencing a 20% growth rate. Sustainable packaging is becoming a priority, with 45% of consumers preferring eco-friendly tea packaging. The Asia-Pacific region is witnessing an expansion in boutique tea houses, while North America is seeing a rise in functional teas infused with herbs, vitamins, and adaptogens.

Out of Home Tea Market Dynamics

The out-of-home tea market is driven by shifting consumer preferences, increasing demand for healthy beverages, and the growing popularity of premium tea varieties. The market is witnessing a surge in organic and functional teas, with herbal tea holding a 23% share due to its perceived health benefits. Quick-service restaurants and café chains collectively contribute 63% to total tea consumption. The adoption of sustainable packaging is influencing purchasing decisions, with 45% of consumers preferring eco-friendly packaging. The rise in tea-based cocktails and specialty tea blends is further driving market expansion.

Drivers of Market Growth

"Growing Demand for Health and Wellness Beverages"

The increasing awareness of health benefits associated with tea is a major driver for market growth. Green tea consumption has risen by 18%, driven by its antioxidant properties, while matcha tea has seen a 15% increase due to its high nutrient content. Consumers are opting for organic and natural tea varieties, contributing to 20% growth in premium tea sales. Quick-service restaurants and café chains account for 63% of tea sales, with a preference for low-calorie and functional beverages. The expanding vegan and plant-based trend is also fueling demand for herbal and plant-based teas.

Market Restraints

"Fluctuating Prices of Raw Materials"

The cost of tea leaves, herbs, and other ingredients fluctuates due to changes in climate, supply chain disruptions, and trade regulations. The price of premium tea varieties, such as matcha and oolong, has increased by 12%, making them less accessible to budget-conscious consumers. Additionally, organic tea production costs are 20% higher than conventional teas, limiting widespread adoption. The supply chain for high-quality tea leaves is vulnerable to seasonal variations and labor shortages, impacting overall market stability.

Market Opportunities

Expansion of Specialty Tea and RTD Tea Offerings

The growing interest in specialty and ready-to-drink (RTD) tea is creating new opportunities. RTD tea now contributes 22% to out-of-home tea sales, with a rising demand for flavored, functional, and herbal teas. Innovations in cold brew and kombucha tea are also expanding market reach. Hotels, bars, and premium café chains are incorporating artisanal teas, driving a 15% rise in gourmet tea consumption. The increasing adoption of sustainable packaging and ethically sourced teas is expected to boost market appeal among environmentally conscious consumers.

Market Challenges

"Intense Competition from Coffee and Other Beverages"

Tea faces strong competition from coffee, soft drinks, and energy beverages, impacting its market penetration. Coffee remains the preferred beverage in quick-service restaurants, holding 55% of total sales, while tea accounts for 35%. The rise of functional coffee and energy drinks poses a challenge, as consumers seek higher caffeine alternatives. Additionally, changing consumer preferences in younger demographics present a hurdle, with 45% of millennials preferring specialty coffee over traditional tea. Overcoming these challenges requires marketing efforts focused on tea’s health benefits and diverse flavor profiles.

Segmentation Analysis

The out-of-home tea market is segmented based on types and applications, allowing for a detailed analysis of consumer preferences. In terms of types, the market is dominated by black tea, followed by green tea and herbal tea, with specialty offerings such as matcha tea and oolong tea catering to niche consumer segments. Applications include key areas like quick-service restaurants, cafés, and hotels, with each sector exhibiting distinct preferences for certain tea varieties. Understanding this segmentation helps businesses better target their offerings to meet consumer demand across different regions and locations.

By Type

• Black Tea: Black tea holds a major share in the out-of-home tea market, making up nearly 40% of the total market. Its popularity stems from its robust flavor and versatility. The rise of premium black tea blends in cafes and restaurants has further propelled its demand, with a 15% increase in specialty black tea varieties. Key consumers prefer it for its stimulating effects due to higher caffeine content. The market for black tea in quick-service restaurants is estimated to represent 35% of total out-of-home tea consumption.

• Green Tea: Green tea is one of the fastest-growing segments, driven by increasing consumer preference for health-conscious beverages. It accounts for around 25% of total out-of-home tea sales. The growing awareness of its antioxidant properties has made it a popular choice, particularly in cafés and wellness-focused restaurants. Moreover, green tea’s versatility in flavored blends such as matcha lattes and iced teas has enhanced its appeal, attracting a wider consumer base across quick-service restaurants and specialty tea chains.

• Herbal Tea: Herbal teas, known for their varied flavors and health benefits, represent approximately 15% of the out-of-home tea market. They are increasingly popular in wellness cafes and restaurants that cater to health-conscious consumers. Herbal tea varieties like chamomile and peppermint are frequently served as relaxing, caffeine-free options. In addition, demand for functional herbal teas such as those promoting digestion or relaxation has increased significantly, with herbal tea growth seeing an 18% rise in certain regions.

• Matcha Tea: Matcha tea has gained considerable traction in the out-of-home tea market, especially in cafés and health-focused establishments. This type of tea contributes to 12% of the market share. The rise in matcha-based beverages, such as matcha lattes and smoothies, has boosted its popularity, especially among younger consumers. Matcha’s distinct flavor and its high antioxidant properties make it a preferred choice in premium tea houses and cafes targeting niche markets.

• Oolong Tea: Oolong tea occupies a smaller portion of the market but has seen increased interest in specialty tea venues. It is known for its unique flavor profile that combines the best characteristics of black and green tea. Oolong tea accounts for 8% of out-of-home tea consumption and is typically found in premium restaurants and high-end tea houses. Its appeal lies in its complex taste and perceived digestive benefits, making it popular in Asian-themed restaurants and luxury hotel chains.

• Others: The “others” category encompasses flavored teas and blended teas, which account for about 10% of the out-of-home tea market. These varieties cater to a wide range of consumer tastes and preferences, offering choices like fruity teas, chai, and iced tea blends. The market for blended teas is expanding as more quick-service restaurants introduce seasonal and limited-edition blends, attracting customers with innovative, new flavor experiences.

By Application

• Quick Service Restaurants (QSRs): This segment holds a significant share in the Out of Home Tea Market, driven by the high demand for quick, accessible tea options. The QSR sector accounts for approximately 20% of the market share.

• Restaurants: Offering a wide variety of tea options to complement their meals, the restaurant segment contributes around 18% to the overall market. Tea consumption in restaurants is expected to increase as part of dining experiences.

• Bars & Pubs: Increasingly, premium teas and tea-based cocktails are being offered in bars and pubs, making up about 12% of the market. This trend is especially prominent in specialty drinks and alternative beverages.

• Hotels: The hotel segment, serving both luxury and casual tea experiences, represents around 15% of the market share. High-end hotels offer premium blends and tea ceremonies to attract customers.

• Cafe/Coffee Shop Chains: These establishments are the largest contributors to the Out of Home Tea Market, accounting for approximately 25%. Specialty teas such as matcha and green tea have become popular menu items in cafes globally.

• Workplaces: Increasing numbers of offices are introducing tea stations and encouraging employees to take tea breaks, contributing about 5% to the market. This trend is gaining momentum in corporate wellness programs.

• Outdoor: The outdoor segment, including events and catering services, contributes around 4%. Tea is becoming a popular health-conscious beverage at outdoor gatherings and festivals.

• Others: This includes various sectors like retail outlets and health-focused services, contributing approximately 1% to the overall Out of Home Tea Market.

Regional Outlook

The out-of-home tea market is geographically diverse, with varying consumption patterns across regions. North America, Europe, and Asia-Pacific lead the market due to the growing demand for healthier beverages and premium tea offerings.

North America

North America represents a significant portion of the global out-of-home tea market, contributing nearly 28% of total sales. This region has seen increased demand for premium and organic teas. The rise of specialty coffee shops offering high-quality tea options, such as matcha and herbal teas, is driving growth. The region’s large tea-drinking population, particularly in the U.S. and Canada, continues to expand, with healthy lifestyle trends further supporting market growth.

Europe

Europe is a key player in the global tea market, with countries like the UK and Germany showing a high preference for traditional black tea. The market is valued at around 30% of global sales, with tea houses and cafés offering premium and specialty tea varieties. Growth is particularly notable in Germany, where green tea consumption has increased significantly, reflecting a shift towards health-conscious beverages.

Asia-Pacific

Asia-Pacific is the largest regional market for out-of-home tea, accounting for 40% of the global market share. The region’s strong tea culture, particularly in countries like China, Japan, and India, is a major driver. Matcha tea and oolong tea are in high demand, with cafes and restaurants focusing on regional tea varieties. The rise of modern tea bars and the increased adoption of tea-based beverages in quick-service restaurants are contributing to the market’s robust growth in this region.

Middle East & Africa

In the Middle East and Africa, the out-of-home tea market is expanding, with a growing interest in herbal and flavored teas. The region contributes around 5% to global tea consumption, with tea drinking cultures in countries like Morocco and Egypt seeing growing demand. Tea cafés and luxury hotel chains are increasingly offering premium blends, with Arabian mint tea and chai varieties being popular choices.

Key Players in the Out of Home Tea Market:

• Unilever Group
• Tata Global Beverages Ltd
• Associated British Foods
• Celestial Seasonings, Inc.
• The Republic of Tea
• Tenfu Corporation
• Peets Coffee & Tea
• Bettys and Taylors Group Limited
• Kusmi Tea
• Dilmah Ceylon Tea Company PLC
• Starbucks Corporation
• Costa Ltd
• Nestle S.A.
• The Coca Cola Company
• Pepsico, Inc.

The top two companies with the highest share in the Out of Home Tea Market 

• Unilever Group - Holding approximately 22% of the market share.
• Tata Global Beverages Ltd - Holding around 18% of the market share.

Investment Analysis and Opportunities

The out-of-home tea market presents several investment opportunities across different types and applications. One of the most significant growth areas is in premium tea offerings, with demand for high-quality black, green, and herbal teas increasing across cafes, restaurants, and hotels. Investment in sustainable and organic tea products is on the rise, particularly in North America and Europe, as consumers continue to prioritize health and wellness trends. For instance, tea companies that are focusing on eco-friendly packaging and sustainable sourcing of tea leaves have the potential for high returns. Another lucrative opportunity lies in the growing popularity of matcha and specialty teas, which cater to younger, health-conscious consumers. These segments are seeing strong growth in quick-service restaurants (QSRs) and coffee shop chains, with the rise in consumer preference for unique and functional beverages. Additionally, technology-driven tea brewing solutions and innovative tea-based ready-to-drink (RTD) products are expected to attract investors due to the convenience factor they offer. Investment in Asia-Pacific markets, particularly in countries like China, India, and Japan, is also promising due to the strong cultural affinity for tea and increasing urbanization. Companies focusing on R&D for flavor innovations and product diversification are well-positioned to capitalize on these market dynamics. The growing focus on e-commerce platforms for direct-to-consumer sales also presents new opportunities for expansion.

New Product Development

The out-of-home tea market is witnessing a surge in new product developments, driven by changing consumer preferences and the growing trend towards health-focused beverages. Companies are increasingly introducing flavored tea variants, such as herbal blends and fruit-infused teas, to cater to a wide array of consumer tastes. For instance, matcha tea products are being developed not only in traditional forms but also as part of tea-based lattes, smoothies, and snacks to attract younger, health-conscious consumers. Organic and fair-trade certifications have also become key selling points, as more consumers seek ethically sourced, environmentally friendly products. Companies are also experimenting with ready-to-drink (RTD) tea formats that offer convenience and a premium drinking experience. This has been reflected in new product launches such as premium iced teas and sparkling tea beverages. Some brands are also focusing on functional teas, which include added health benefits like antioxidants, probiotics, and adaptogens, aiming to enhance consumer wellness. Peet's Coffee & Tea, for example, introduced a new line of plant-based matcha lattes, capitalizing on the growing demand for dairy alternatives. Similarly, Nestlé has expanded its offerings of organic iced teas to meet the rising consumer demand for clean-label products. These product developments are not only tapping into the growing trend of health and wellness but also reshaping the way tea is consumed in the out-of-home market.

Recent Developments by Manufacturers

• Unilever Group launched a new line of premium green teas under its Lipton brand, focusing on sustainable farming practices and organic ingredients in 2023. This new product line was introduced across major European markets, particularly in cafes and high-end restaurants.

• Tata Global Beverages Ltd expanded its product portfolio by introducing herbal tea blends that combine flavors and health benefits, targeting consumers looking for relaxation and digestive aids. This launch in India and Southeast Asia in 2024 aims to capture growing demand in the wellness market.

• Peet’s Coffee & Tea introduced ready-to-drink matcha beverages in QSRs and cafés across the U.S. in 2024. This product caters to the trend of functional, on-the-go beverages that combine convenience with health benefits.

• Nestlé S.A. entered the sparkling tea market in 2023 with the launch of Nestea Sparkling in North America. This move was in response to the increasing consumer interest in carbonated and low-sugar beverages, tapping into a growing market segment in cafes and restaurants.

• Costa Ltd unveiled a new range of iced teas in Europe, focusing on natural ingredients and sugar reduction in 2023. This product innovation aims to cater to the rising demand for refreshing and healthier tea options in outdoor cafes and quick-service restaurants.

Report Coverage

The report provides an in-depth analysis of the Out of Home Tea Market, detailing key segments such as types (Black Tea, Green Tea, Herbal Tea, Matcha Tea, Oolong Tea, Others) and applications (Quick Service Restaurants, Restaurants, Bars & Pubs, Hotels, Café/Coffee Shop Chains, Workplaces, Outdoor, Others). It covers the market dynamics, identifying the drivers, restraints, opportunities, and challenges faced by the industry. The report also highlights the regional outlook, providing insights into the market size, share, and growth prospects in North America, Europe, Asia-Pacific, and the Middle East & Africa. Detailed profiles of key players in the industry, such as Unilever Group, Tata Global Beverages Ltd, and Nestlé S.A., are also included, offering valuable information about their market strategies, recent product innovations, and investment activities. The report aims to provide stakeholders with a comprehensive understanding of the market trends, competitive landscape, and potential investment opportunities in the out-of-home tea market, helping businesses to make informed decisions and capitalize on emerging opportunities.