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Friday, August 13, 2010

Local Kombucha Makers Actually Benefit from Ban

Posted By on Fri, Aug 13, 2010 at 11:59 AM

click to enlarge house_kombucha_bottles.jpg
It should have been a disaster. Healdsburg-based Vibranz Kombucha launched March 20, 2010, with a promising start. The company had just won a product award at the Natural Products Expo, which had brought them to the attention of natural-foods distributors, not to mention placement in every Whole Foods store in the Bay Area and Pacific Northwest.

Three months later, the kombucha-labeling crisis hit. Responding to concerns that the alcohol level of the fermented tea had surpassed 0.5 percent, which would require the drink to be regulated as an alcoholic beverage, many stores ― most notably, Whole Foods ― pulled all kombucha from their shelves. All that momentum: gone.

Turns out, says Vibranz president Kathy Taylor, the voluntary recall has accelerated their growth. That's because Synergy

(aka GT's Kombucha), the largest brand in the nation, is still

reformulating its product to ensure alcohol levels stay low. (Side note:

Stores like Berkeley Bowl and Good Life, which have started stocking Synergy drinks again,

are selling existing product, which distributor The Good Stuff just confirmed

to SFoodie.) Meanwhile, demand for kombucha hasn't dissipated. That

absence of the industry's major player means that smaller local

companies like Vibranz are seeing a huge bump in sales.

Rana Chang, co-owner of San Francisco-based House Kombucha,

concurs. Chang and

Asad Modarai founded House in September 2009, graduating from a stand at

the now-defunct Metreon farmers' market to selling reusable 16-ounce

bottles at two dozen local markets. House was too small, in fact, to

feel the effects of the recall. "Rainbow stopped placing new orders for a

while," Rana said. "But not even a week.

We tested our product, we stand behind it, that's good enough."


House has doubled production since June. Chang had anticipated that

sales would hit that target thanks to warmer weather, but the

disappearance of Synergy helped, too. "There are a lot of people trying

[our product] who wouldn't have seen

it because Synergy took up so much shelf space," she says.


or not local kombucha producers see alcohol-level issue as a boon or

bust depends on how much they sold through Whole Foods. Lev Kilun of Lev's Original Kombucha, who operates out of Treasure Island, lost 30 accounts when Whole Foods pulled his product from their shelves. He's

back in Andronico's, and some accounts have grown, but he still hasn't

returned to Whole Foods. The grocery chain is waiting for him to prove

that his product is below 0.5 percent alcohol by volume or lower, and he's trying to figure

out how to do that. "We always were at that [0.5 percent] range," Kilun says.

"We small producers don't have the tools to verify whether it contains

0.5 percent or 0.55 percent.

Now we have lab working with us in Saint Helena, and are sending every

batch to the lab to test overnight." He's not worried about the cost of

the extra testing, but more about the logistics of tweaking his formula in just the right way. "It costs me in gray hairs," he jokes.

After a

three-week break, Vibranz was able to demonstrate its low alcohol

levels to Whole Foods. "My partners are former wine makers and

sparkling-juice makers," Taylor says. "So they were quite aware of

watching the fermentation." With no competition from the best-known

brand to slow them down, Taylor estimates the growth as 400 percent in

just two months. "We have a fabulous product," she says. "All we needed

was for the market to give us a try."

Follow us on Twitter: @sfoodie. Follow me at @JonKauffman.

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