Cover Story Notebook: Don’t Overreach Bounds

In a ongoing series, Brewer will take a small note from interviews of some of the cover stories it has run and give a small tidbit that didn’t make the issue, but is still worth diving into.

We have seen breweries that have overreached their bounds and either have to scale back or go out of business soon after. The breweries that have stayed smaller on purpose seem to be the ones that have been able to grow, but be sustainable.

Russian River sort of stumbled across this strategy because of limitations that husband and wife duo Vinnie and Natalie Cilurzo said they had in the early 2000s and into the 2010s. Even after growing to the size where they have been able to almost double production capacity with a new home, the California darling of many consumers still won’t be breaking 100,000 barrels for quite a while.

Natalie Cilurzo even joked that they built the new brewery for large growth, but not ‘necessarily for us.’

Why? Fast growth isn’t as important as quality is for the Cilurzos.

But growing to a size where you can make a quality product that can be recognized on a shelf is important as well.

“I think it’s been a really successful business model for a long time​,” Natalie told us at the 2018 Craft Brewers Conference in an interview for the November/December 2018 issue of Brewer​. ​”​I think that a lot of the smaller breweries that are just getting in … they’ll find that they’re also going to need to take on a little bit of distribution to get their name out there. Because eventually you’re going to saturate your local market.​”​

Barrels from Russian River Brewing.

But hyper-local obviously is very, very popular.

“Having a healthy mix of retail and distribution is a great way to get your name out there,” Cilurzo said. “Not everybody that lives in another state will know about your brewery. If they are able to buy it in the store or see you at a beer festival or some other way it can expose you to them.”

Of course, beer tourism is still hugely popular and consumers will design their entire vacations around going to breweries.

A place like Santa Rosa, California is a specific region that people go to for such an event thanks to the popularity of Russian River’s beers.

“I think that is something I don’t see that ever going away,” Cilurzo said about beer tourism. “I really don’t. So I think that having that retail component to your business is key to survival.

“It’s key to keeping you relevant. And it is incredible marketing to get instant feedback from your customers to see what they like and what they don’t like. They will sit at the bar and tell you.”

But she noted that you can get your beer out there, but what good does it do when you have your shipments and depletions from a wholesaler’s shelves, but it sits on a shelf or in a restaurant.

“It doesn’t do you any good because then that backlogs and you have old, stale beer out there,” she added.

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