Stir Tea Coffee Industry Bi-Monthly

Liang cha, the Cooling Tea that is Becoming Hot

According to the local chronicles, miasma-related diseases included fever, headache, vomiting, indigestion, malaria and typhoid, etc. In some worst cases, miasma epidemics were fatal. To people in the region, Liang cha was an affordable and effective daily drink to drive away excessive body heat that led to heat illnesses, and regular consumption also helped to regulate body immune responses to fight against miasma epidemics.
As time passed, Southern China developed a unique Liang cha culture, with Liang cha stores dotting the streets selling both drinks and dry blends. The locals consumed the tea whenever they felt hot or uncomfortable.
Liang cha is in fact various herbal infusions made from either single or assorted cooling herbs to clear excessive body heat. There are about 200 commonly used cooling herbs in the making of various types of Liang cha. Depending on the herbs used in a recipe, Liang cha can be divided into several sub-categories with complementary functions besides the major cooling effect.
For example, diuretic Liang cha that dispels excessive body fluid; detoxicating Liang cha that targets skin ulcer and boils; heat illness Liang cha that prevent heat exhaustion and sunstroke. Depending on the recipe, Liang cha has varied tastes. Many Liang cha have a very slight innate sweetness but taste closer to Chinese medicinal decoctions and some are rather bitter.

Traditional Chinese Medicine
Liang cha was first appeared in Guangdong Province in the early 19th century, which was a cooling decoction produced according to Traditional Chinese Medicinal (TCM) theory. All the ingredients were washed and boiled in clean water to get a functional infusion. Most traditional Liang cha stores were small family businesses relying on word of mouth and community support to develop sales. Established stores and brands normally had well-tested recipes handed down from generation to generation, and some owners or partners had profound medicinal experiences to recommend customized recipes according to a client’s specific condition. Professionalism and good service were two selling points of these stores.
Major patrons of Liang cha stores were Chinese medicine stores, street Liang cha vendors and neighborhood consumers. The first two purchased dry blends for resale as well as boiling them into drinks for retail. The latter either brought dry blends to boil at home for household consumption or brought drinks for the convenience and to save preparation time and fuel. Drinks were often sold in bowls and later in glasses. As no preservatives were added, they had to be consumed within the day. In the mid 20th century, spray dried (powder or granule) Liang cha was available, greatly simplifying preparation. These products also entered into local convenience stores and supermarkets. However, it was restricted to the traditional market of southern China and among Chinese races (most of them were descendents of immigrants from southern China) living in Southeast Asia. Outside these traditional markets, people were not aware of this type of tea.

Royal support
Wong Lo Kat is one of the famous Liang cha brands with loyal supporters in Guangzhou and Hong Kong. Local accounts had it that the recipe was first created by Wang Zebang around 1828 with the intention of preventing a widespread miasma epidemic. Mr. Wang (spell as “Wong” in Cantonese) was awarded by the Royal court for the invention, and he later set up a store in Guangzhou City to sell his award-winning Liang cha. Since his pet name was Ah Kat, the store was named Wong Lo Kat (Lo means old). In 1840, due to overwhelming market response, Wong started to sell the tea in tea bags. By the end of 19th century, Wong’s sons expanded the stores and opened branches in Hong Kong. Wong Lo Kat was split after the founding of the People’s Republic of China, the stores in Guangzhou were nationalized in 1956, and later merged into a state-run medicine company, whereas the stores in Hong Kong continued to be run by Ah Kat’s descendants as a family business.
In 1997, Guangzhou Wong Lo Kat signed a trademark licensing agreement with Hong Kong-based JDB group,  which authorized the latter to produce and sell red can RTD Wong Lo Kat. JDB set up its first plant in Guangdong and launched the RTD drink there. To make the drink more palatable, JDB’s R&D altered the original recipe. Though the regional market was filled with clutter as there many Liang cha brands and Chain stores that provided greater choices, the group managed to gain its share in Guangdong and later expanded to nearby southern Zhejiang province, with annual sales maintained around RMB0.1 billion (US$15.8 million).
The outbreak of SARS in the spring of 2003 raised national awareness of drinks with cooling effects. JDB quickly grabbed the opportunity to accelerate its national expansion. It targeted China Central Television (CCTV) as the media platform to promote its Liang cha national wide. In the year, the group spent RMB40million on CCTV’s Prime Time Commercial Bid to advertise the cooling effect of Wong Lo Kat. Perfect timing and well-targeted TV commercials delivered through China’s most influential TV network made the brand a black horse in the RTD market.
Consumers outside traditional Liang cha markets quickly accepted Wong Lo Kat as a health drink, which cleared excessive body heat due to lack of sleeping and an unbalanced fast-food dominated diet. Furthermore, Wong Lo Kat was also established as the synonym for Liang cha. 2003 was the turning point for Wong Lo Kat as it established a nation-wide influence and stepped into a larger market. In 2002, Red Can Wong Lo Kat sales value was RMB0.18 billion  whereas in 2003, it rose to RMB0.6 billion, a more than three-fold increment.
The huge demand and vast potential attracted JDB to speed up its national expansion. Since 2003, JDB gradually set up RTD plants in Beijing, Zhejiang, Fujian and Hubei to foster its national distribution network. It also built herbal plantation bases in Guangdong, Fujian, Hebei and other strategic locations to complete a nation-wide supply chain network. It also cooperated with restaurants and steamboat chains to include Wong Lo Kat into drink menu and offered free samples there. TV commercials were a major advertisement focus of JDB. Since 2003, JDB has been a loyal advertiser with CCTV. In 2004, JDB’s CCTV commercials cost the company RMB0.1 billion; in 2006, the year of the FIFA World Cup, the figure rose to more than RMB0.2 billion. During the FIFA live show, Wong Lo Kat was presented as a refreshing and cooling drink for an audience that stayed up late at night to watch the game; in 2007, the year before 2008 Beijing Olympics, RMB0.43 billion was spent to make JDB the highest bidder of the year. Heavy investment on the national TV network turned ut to be money well-spent, and annual sales of Wong Lo Kat multiplied, with RMB 1.5 billion earned in 2004, nearly RMB4 billion in 2006 and clise to RMB9 billion in 2007.
A promising market and the fast expansion of Wong Lo Kat stirred other Liang cha producers and beverage companies. Many other brands took to the bandwagon to launch RTD Liang cha, and even the brand owner Guangzhou Wong Lo Kat also marketed green pack Wong Lo Kat in 2005. Though there are many newcomers and competitors, to date, JDB remains the predominant market leader, Its red can has annual sales around of RMB12 billion and accounts for 90% of the Liang cha market. Industry sources said that Liang cha is now ranked about 4th in China’s RTD market.
Though Liang cha is basically a health drink and many RTD Liang cha makers have altered their recipes to reduce certain medicinal herbs for milder effects, the old saying “too much of anything is bad” still applies. There were reports of consumers in Shanghai drunk 4 to 5 cans a day suffered mild diarrhea. It is prudent to control the consumption and consult TCM practitioners as and when needed.