If you are reader of this site with any frequency, you probably know that we’re passionate about small and micro businesses. We’re constantly looking for the latest information on the
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space — from perusing articles and research data to conducting our own research. Earlier this month, we stumbled across a copy of Brewing up a Business, by Sam Calagione, the CEO of Dogfish Head Craft Brewery. The book is a tale of how a micro business grew into a leader in the craft beer space. Caglalione grew his business from a few people to well over 100 employees in just over a decade. Throughout the book a number of underlying themes offer insight into the challenges that the team at Dogfish Head faced while growing the business. Many of you have probably faced similar challenges in your business:
Numbers matter – In the early days of the company, Calagione was more fluent in the brewing side of the business than the financial ledger. After years of scraping by and coming close to profitability, members of the company’s board hammered home the importance of the statement “cash is king” to him. Since then he took a more vested view of that side of the business, despite hiring a team that manages that area of the business. This understanding has allowed Calagione to see past the here and now to get a better understanding of how the company is doing financially for both the short and long-term.
Generating your own buzz (or advertising or marketing or PR) – The beer industry is dominated by mega conglomerates and Calagione knew that he did not have the budget to compete on their level. Instead of buying advertising, the company used their product and their consumer base to generate buzz. Calagione sent samples of their beer to influential publications within the beer industry as well as lifestyle publications, in lieu of traditional press releases. While this does not always generate coverage, it landed the company some notoriety among some of the country’s largest media outlets. They have also used festivals and tradeshows as a platform to expand their customer base via personal interactions in an informal setting. This helped generate word of mouth buzz and also pushed stores to ask distributors for the beer to meet the needs of their customers.
Cultivate a brand identity from the inside out – Do you know what the janitor, the waitstaff, head brewer and receptionist at Dogfish Head have in common outside of their place of employment?
They’re all shepherds of the company’s brand. Calagione believes that all employees need to live and breathe the company culture. They are all given an indoctrination and education when they begin their employment. This ensures that anyone that may come in contact with a customer is knowledgeable about the product and can answer questions that they may have.
Values over VALUE – At the end of the day, businesses do not survive without a profit. With that said, your company should have a set of values that are essential to your business. These give customers something to associate with and may even drive in a certain clientele. This can be anything from value to quality to using only sustainable materials. In the case of Dogfish Head, it is producing flavorful full bodied beers.
In a meeting with the company’s board, discussions turned to maximizing profits. There was talk about producing a more traditional beer with less expensive ingredients. Calagione was vehemently against this as it was against the company’s mission statement and would dilute their brand. He mixed this notion along with business metrics to show that sticking to their business plan would yield a profit despite appealing to a smaller group of clientele.
Local love – Perhaps the biggest takeaway from the growth of Dogfish Head (and the book) was their commitment to the local community. Throughout the evolution of the company, Calagione made it a point to be an active member of the local business community. This meant everything from partnering with other local businesses to help send reciprocal business to participating in local chamber of commerce events. These relationships also served as sounding boards for business advice when things were going both good and bad.
There are tons of other great lessons and anecdotes in the book that are great for business owners, entrepreneurs and beer lovers alike. If you are interested in the book, you can pick up a copy new or used here.
Has your business employed similar principles? Is so, we’d love to hear your story in the comments below.
Wow,, buisness can be tough, but the joy of doing what you love to do dispite the hardship is the best of all. The drive of it all for the love is what is soo fulfilling.I may not have a booming buisness at this moment, and almost don't want a booming buisness, its not the money that drives us ,, its the love of what your doing. Thanks Jeff for making buisness cards and all that you have to offer,, reasonably priced for those that are trying to make the best.
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