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Argo Tea

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"Argo Tea" is a chain of tea cafes.

The idea for a chain of tea cafes was hatched by Arsen Avakian, 31 by 2007, and Simon Simonian, 32 by 2007, boyhood friends from Yerevan, Armenia, who emigrated to Chicago in the 1990s for postgraduate study.

Both ended up in high tech, Simonian as a computer scientist and Avakian as a specialist in start-ups who recruited millions in venture capital to open a software company.


After the dot-com bust, Avakian spent a lot of time in coffee shops, noticing how many customers they attracted.

It isn't every cafe in America that responds to the complaint "I'm thirsty" with a glass of iced tea. But Argo Tea chain is selling just that notion.

"I asked myself, what would be the closest cousin of coffee?" Avakian said. "In Europe that's easy. It's tea. But here in the United States, tea is one of the least consumed beverages. People in Chicago said how stupid can you be, starting a business with tea as the dominant drink? I said, perfect. That's the opportunity I'm looking for."

Simonian and Avakian hired Mark A. Cuellar, a Chicago architect, to design the cafes' interiors, which include long library-style tables with outlets and Wi-Fi for Web surfers.


In effect, Avakian and Simonian went from I.T. to iced tea and in 2003 opened first Argo Tea cafe.

By 2007 Argo Tea, a four-year-old company has developed a distinctive brand that has captured the palate of young professionals. From its novel recipes for sweetened iced teas -- Bubble Tea, a mix of Indian black tea and coconut pearls from the Philippines, is very popular -- to its signature interiors of greens, reds and browns.

Simonian and Avakian also came up with innovative tea drinks that sell for less than $4. Among them are MojiTea, made with Armenian mint and fresh lime, and Tea Squeeze, a mix of Egyptian hibiscus leaves, fresh lemon juice and sugar cane.

Along with hot and iced tea -- and Illy coffee -- the cafes sell sandwiches and pastries, some baked on the premises.

By 2007 the brand has become so well known that in September 2007 the company opened its eighth cafe, in the Lincoln Park neighborhood. They were planning to open two more by the end of the 2007.

Sales were expected to reach $5 million in 2007 and nearly $10 million in 2008, company executives say. The concept has proved so successful that Argo Tea was planning cafes in other cities, starting with Boston or Washington in 2009.

By 2007, the company employed nearly 150 people, most part-time, and offers medical benefits to those who work at least 20 hours a week. The company gives raises periodically based on how well workers score on a written test.

Objective evaluations are only one ingredient in the partners' recipe. "Our business appeals to the senses and desires," Avakian said. "Things have to be right, feel right, taste right. It's much more subjective than high tech."


Sources

  • SIDESTEPPING STARBUCKS WITH CAFES THAT SELL TEA, By Keith Schneider, The New York Times, Late Edition - Final, September 26, 2007 Wednesday