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'Honest Tea' Helping Pave Way for Healthy Bottled Drinks

  • Deborah Block

Honest Tea bottles get packaged for distribution and eventual consumer sale

Honest Tea bottles get packaged for distribution and eventual consumer sale

Today there are a number of bottled drinks on the market in the United States that are considered healthy. But that wasn't the case 10 or so years ago, when a company called "Honest Tea" created the first healthier bottled tea. The firm was co-founded by Seth Goldman, a health-conscious entrepreneur in Bethesda, Maryland.

Seth Goldman, co-founder of "Honest Tea" found most bottled drinks to be too sweet or tasteless. So he created bottled teas that taste good, are made from organic tea leaves, and have little sugar.

"We're trying to make people move toward healthier diets," explained Goldman.

Goldman started brewing teas in his home with business partner Barry Nalebuff. They came up with five different types of bottled teas they marketed as "Honest Tea." Goldman says it was difficult to sell the new brand until they took some bottles to a natural foods grocery store.

"I tried selling it to mainstream sandwich shops and grocery stores and they said, 'This isn't sweet enough. This tastes like grass. People aren't ready for it.' And of course, now people are ready for it," added Goldman.

Honest Tea does little marketing and most people hear about it by word of mouth.

"Tea is the world's second most popular drink, second to water, and there are literally thousands of tea formulations around the world, so the challenge for us, isn't finding new tea recipes, it's focusing and making sure we're developing things that are going to work," explained Goldman.

Goldman and members of his staff continue to do this in the kitchen at the corporate headquarters.

Some tea companies use pesticides to grow tea leaves, but Honest Tea uses tea leaves from China, India and South Africa that are grown without pesticides or fertilizers.

"A portion of our sales goes back to people picking the tea leaves," he noted. "In the past, we've supported a computer learning center, and some micro-enterprise funds, and so they can invest in what they deem to be the priorities in their community."

A few years ago, Goldman branched out from tea and created organic juice drinks. They include drinks for children, called "Honest Kids." His son Elie helped with that idea after telling his dad that most kids' drinks have a lot of sugar in them.

"I guess 'Honest Kids' is a good way to get away from those sugary liquids and get a good, healthy, quality alternative," said Elie Goldman.

Seth Goldman wanted to expand his operation to reach more consumers. In 2008, the giant Coca-Cola Company bought 40 percent of Honest Tea and has the option of buying it all in 2011. For now, Goldman still heads the firm and says Cola-Cola realizes more people want healthier drinks.

"Honest Tea is where the future is headed, and for Coca-Cola it's a great investment opportunity, because they're investing in the future too," noted Goldman.

Honest Tea is the nation's top-selling organic bottled tea company. Even in a poor economy, the company grew 20 percent last year. And it probably helps that U.S. President Barack Obama has said some brands of Honest Tea are his favorite beverages.

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