How The Founder Of A Craft Brewery Made His Company Ultra Successful By Not Selling His #1 Beer
Sam Calagione is the founder of Dogfish Head Craft Brewery, one of the hottest breweries in the entire nation. Dogfish Head ranks 14th on the Brewers Association’s list of Top 50 U.S. Craft Brewers based on beer sales volume. In May, Calagione won the James Beard Award for the Outstanding Wine, Spirits or Beer Professional of the Year, after being nominated in the category seven consecutive years. But many years before the accolades and the awards, Calagione took his company to the next level with a strategy that nearly all other entrepreneurs would balk at.
Sam opened Dogfish Head Brewery in Milton, Delaware way back in 1995 when the term “craft brewery” was not in the basic vocabulary of the regular Joe, let alone a popular business. In 2003, Dogfish Head created 60 Minute IPA, which became an immediate success. Sam noticed all of the massive sales and demand for 60 Minute IPA and was excited, but he was also concerned. His #1 beer could have easily constituted up to 80% of Dogfish Head’s sales, but Sam had the discipline and foresight to see that having a popular brew is great, but in the long run, it could hurt his business as a whole. So in 2005, Calagione decided that he would not allow his #1 beer by far would never to surpass 50% of all Dogfish Head sales. While nearly any other brewery would covet having just one beer as popular as 60 Minute IPA, Sam saw the negative of being dependant on one variety of beer. Sam didn’t want Dogfish to be known only for 60 Minute IPA because nobody would know about its other beers. Sam knew about how beer fads come and go and what if fickle drinkers lost interest in IPAs, they would look for another beer after they were over IPAs.
At first, this was not a welcome decision. Distributors and retailers and complained immediately. “I have customers walking into my store trying to buy your 60 Minute IPA and then yelling at me for not having it stocked,” a local liquor store owner told Calagione. “Then they’re leaving without buying anything. I’m a local entrepreneur, you’re a local entrepreneur — can’t you help me?”