Reflections on 2020. Plans for 2021.

This is a message from Yunomi Tea Merchant, Ian Chun (and CEO of Matcha Latte Media KK, the operator of Yunomi.life). In this message: a review of 2020, and an outline of goals for 2021.

I am writing this on the first Saturday in 2021 as the family relaxes together. Reflecting on 2020, it has been such a sad, challenging year for so many. Yet, as an e-commerce company, we have benefited from the shift to online spending throughout the world.

Japan & Covid-19

In the beginning, Japan was one of the first countries to see cases outside of China as the virus spread, and while the government could not constitutionally enforce a shutdown as cases increased, the Japanese people, and Japanese business complied with voluntary requests to limit or close businesses. The Japanese people have always been hypersensitive to cleanliness - a tendency that stems from the Shinto religion - and that hypersensitivity has arguably been one of the major reasons the pandemic has been contained in Japan.

In addition to a nationwide system of contact tracing that has been in place for years and an awareness of the high population density of urban centers, universal mask-wearing, universal availability of hand sanitizers, increased awareness of hand washing, a natural avoidance of physical contact with others (bowing instead of shaking hands) have all been contributing factors (in my layman's opinion) to preventing the pandemic from spreading. I write this and believe this even as cases are spiking in Japan breaking the 4000-case daily threshold nationwide on December 31st.

Given the population density here, we are always worried. However, being American myself, my thoughts and attention naturally focus on the situation in the USA where my family in Hawaii and other parts of the country as well as where 70% of Yunomi's customers are going through unprecedented challenge, tragedy, and turmoil. 

E-commerce Booming, Logistical Challenges

I mention this situation because we are an e-commerce company, and e-commerce has been one of the fortunate beneficiaries of all the changes in the economy during this pandemic. While we have had to deal with suspensions in postal service to our customers around the world, we have been able to find solutions in most cases (though not all). DHL Express, while expensive, has been a lifesaver as global postal logistics was ground to a halt as the result of the disappearance of international travel. We have had to end our subscriptions program (which was fraught with conflicts with the main system anyway) due to the new higher cost of shipping, but aggressive subsidizing of shipping costs have resulted in a higher average order prices as our customers have concentrated their purchases into fewer shipments.

Performance 2020

I consider our customers to be stakeholders in the success of our company - the more successful we are, the better we can serve you. So, let me be even more specific. Yunomi.life has seen approximately a 70% increase in retail sales this year, shipping about 20,000 units of tea and other items in just over 4200 orders to over 50 countries (70% in the USA). Our wholesale business has remained relatively flat as we focused on growing retail this year, so overall I believe business has increased around 35% and putting us at about US$400k in annual revenue: we are now a stable, sustainable small business. We ended up hiring 5 women part-time this year to help us handle the surge in business: 3 of them mothers with young children looking to get back into the workforce.

Since managing 1700 products including thousands of variations is a very inefficient business at a small scale, costs are high. I have not yet started paying myself a salary as a CEO, but I hope to be able to do so in 2021 if we can continue the growth we saw in 2020. In case you are wondering how I support a family by doing this, I am the homemaker of the family; my wife earns money for the bread and butter (and tea), and one reason I am running my own business is to have the flexibility to support her career in a country with a traditionally low glass ceiling for women. I have a lot more to say about women in the workplace in Japan (and men at home), but that's a topic for another time.

Returning Profits to the Community

The increased business from you have allowed us to help out a few farms whose main wholesale buyers unfortunately reduced or cancelled their purchases this spring, and one farm whose tea field was half destroyed in a landslide due to heavy rains in July. Our contribution was small in comparison with their losses, but the farms were appreciative of the support from the international tea community.

Also, with the help of your donations, we sent tea to hundreds of healthcare workers as well as a community center in a low income area (the neighborhood where I grew up in Hawaii) hit especially hard by the pandemic. We would like to extend this effort in 2021. While tea has some antibacterial and antiviral efficacy, it isn't nearly enough to be considered a prevention measure. However, as we all know, a cup of tea is a moment of peace, and if there is ever a time where a moment of peace was needed it's now.

Major Changes in 2021 - Multi-currency Checkout

At the beginning of 2021 (Jan 1st) we switched the store's base currency to Japanese yen, and enabling multi-currency checkout if using a credit card (more info about this here). 

There are 3 major reasons why we are making this change:

  1. First, switching to Japanese yen allows us to offer multi-currency checkout without making accounting work a nightmare.
  2. Second, it allows us to expand into the Japanese market, providing Japanese tea enthusiasts with the opportunity to purchase multiple teas from multiple producers. Since 95% of the market for Japanese tea is still in Japan, we hope this will help to increase volume and create better economies of scale to lower prices and improve service for everyone. I don't imagine that we'll be able to compete with other Japanese tea businesses (and our suppliers) on price, but for those tea enthusiasts in Japan who want to buy lots of different teas from lots of different producers, hopefully Yunomi.life can be of service. 
  3. Finally, we are working on a product registration system for producers, and Japanese yen pricing will make it more understandable for them. More on this below.

Major Changes in 2021 - Multilingual Site

We are also instituting multilingual capability on the website, beginning with automatic google translation of content, which we hope to then customize so that information is more accurate...particularly cultural information that may be difficult to translate.

If you would like to suggest a translation, please submit it here.

Major Changes in 2021 - Global Distribution Platform

Yunomi.life philosophy holds that a life steeped in tea is a first step to greater fulfillment, peace, as well as health. And there are so many more products that can contribute to this life of tea: gourmet foods from artisanal producers, beautiful tea and table ware, educational services (lectures, consultations, travel support?)...

I have wanted to turn Yunomi.life into a platform for years, but the standard marketplace model was never the best fit. The complexities of shipping food overseas while maintaining a high level of compliance with regulations in different countries that are often not specific to tea and in conflict with each other create a nightmare in logistics. And even before the logistics of international shipping, attempting to teach people unfamiliar with Japanese culture about products deeply steeped in Japanese culture is beyond the ability of most Japanese producers.

Transforming into a Platform

Yunomi.life has instead become an online store with (a small) marketplace-like breadth of variety. But I have been thinking about how we can expand this over the past few months, and hope to implement some of my ideas this year. If you are an expert in a related field, I'd love to discuss some of my ideas with you, so please reach out to me through the support chat at the bottom right.

As part of this effort I also hope to involve non-producers as supporters - Curators who will help guide people through their exploration of Japan, Japanese culture and of course Japanese tea. These Curators can be resellers, bloggers, experts in specific fields, creating an open learning platform in addition to a distribution platform.

Major Changes in 2021 - Moving out of the Kominka

Finally, I will be moving the company out of the Kominka where we have been based since the beginning of 2019. I believe we will leave the house in a great state for someone to take over, and while I will miss having the tea room, I have personally moved back to Tokyo to support my wife's career. Maintaining primary operations at the Kominka has become difficult, and with the expansion of the company, we will need a more professional facility in any case. Nothing has been settled yet, but I do hope to launch an office in a convenient location in Tokyo itself so that when international travel resumes, we can more easily welcome tea enthusiasts to come and share a cup of tea.

 

Thank you very much for reading until the end! There is so much to strive for in 2021, and I am extremely optimistic for both the company and the world. Please feel free to reach out to us with your thoughts publicly by commenting below or privately by clicking on the support chat at the bottom right, I'll do my best to reply to each and every one of you.

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