E-Malt.com News article: USA, CA: Russian River Brewing analyses the possibility of an expansion to meet growing demand

Each winter, beer lovers from across the United States and beyond line up in downtown Santa Rosa when Russian River Brewing Company releases its cult-classic ale, Pliny the Younger. The extra hoppy “triple IPA” typically sells out within two weeks. But demand for Russian River's other brews has grown so strong that the Santa Rosa company has reached production capacity and doesn't have enough suds to supply its current list of restaurants and bars, pressdemocrat.com reported on January, 6.

The company ended distribution in Washington last month after more than four years in the Evergreen State.

“We pulled out of Washington simply because we don't have the beer,” said Natalie Cilurzo, who owns Russian River with her husband, renowned brewer Vinnie Cilurzo. “We need it at home because of the pub. That beer is going straight to the pub.”

Russian River's pub enjoyed a brisk Christmas season, with business up 60 percent from a year earlier. And the Cilurzos are talking together about whether and how they might expand production from their current level of 14,000 barrels a year. Natalie Cilurzo said the couple is “in the middle of the evening discussion phase” and wants to take time to develop a well-thought-out solution.

“We probably need to make a decision in 2013,” she said. An expansion could cost between $10 mln and $20 mln, an amount of debt she considers sobering.

The 70-employee Russian River is known for making world-class beers and for taking a controlled approach to growth.

“They're one of the best breweries in the world, and they're doing this on their own terms,” said Ken Weaver, a Petaluma author who wrote “The Northern California Craft Beer Guide”.

While no longer shipping beer to Washington, they still work with distributors in Southern California, Portland, Denver and Philadelphia.

Natalie Cilurzo has indicated that Washington was selected as the place to pull back from because of the difficulty of “managing our brand” there, due to some unique liquor laws. Even so, she expressed a desire one day to resume business there.

The brew pub's sales have quadrupled since opening nine years ago and account for more than half of Russian River's total business. Thus, making sure the pub has enough beer remains a priority for the company.


09 January, 2013