Dogfish Head Up 20 Percent in 2012

Brewery will celebrate hops with AHOPECLIPSE NOW! beer dinners

Looks like second place will suit Sam Calagione just fine. The founder of the “off-center” Dogfish Head Brewery told his distributors that the company is no longer the fastest-growing craft brewery in the company.

Instead, over the past five years, the Delaware-based brewer, which grew by 20 percent last year, has the second-highest growth average over the last five years among top 50 craft brewers, Calagione wrote in a letter to those distributors. Excerpts from the letter were shared with Brewbound.

“We are not the fastest-growing brewery in the country anymore and I doubt we will ever be again,” he wrote. “We are not the biggest brewery in the country and I’m 100% this will always be true.”

That caveat aside, goals are still high at Dogfish Head — Calagione said he’s aiming at maintaining a growth rate close to 20 percent for the next several years.

According to VP of Sales Adam Lambert, much of that growth this year will be demonstrated in the company’s commitment to hops. The company has launched AHOPECLIPSE NOW!, a series of more than 50 beer dinners built around Dogfish Head’s diverse portfolio of “hop-centric” beers.

Such a foray is on-trend for both the company — whose best-selling 60- and 90-minute IPA offerings refer to the length of time that hops are added to the boil during the brewing process — and also with a national trend favoring IPAs, which last summer passed seasonals to be the best-selling craft beer style in U.S. supermarkets, according to retail data supply firm Symphony/IRI.

“We have an opportunity to yell at the world that we make beers based around hops,” Lambert said. “We have been a hop-centric brewery since day one and this is our way of reminding everyone that we are committed to hops by celebrating it.”

Lambert said that nine different offerings, all “built around a hop base,” will be available to consumers over a 60 day period. While consumers may already familiar with most of the offerings, Dogfish Head will introduce two new labels in the first quarter. The first, Rhizing Bines, is an Imperial IPA brewed in collaboration with Sierra Nevada. It launches next month. The second, Sixty-One, is a beer/wine hybrid and the company’s first new core beer in five years. That beer will debut in March.

The 2012 sales recap sent to the company’s distributor partners on Sunday night showed just how hop-heavy a hammer the company can swing: 76 percent of Dogfish Head’s total annual volume comes from an IPA portfolio consisting of eight different beers. And in 2012, that portfolio grew at a pace of 25 percent. Lambert told Brewbound.com that 66 percent of the company’s overall production comes from 60 Minute IPA and 90 Minute IPA alone. He acknowledged that 60 Minute IPA is the “workhorse,” but also said that since 2009 the company has placed an emphasis on making 90 Minute IPA a higher percentage of its overall sales.

“We felt that if a consumer could jump from 60 Minute [IPA] to 90 Minute [IPA], they could digest the rest of our portfolio,” he said. “If we could grow 90 Minute to 30 percent of our production, we would be doing cartwheels.”

And 30 percent might not be so farfetched. The 90 Minute IPA brand grew 31 percent in 2012, trailing only Burton Baton – which grew 80 percent – as the fastest growing core brand. Core brands include Shelter Pale Ale, 60 Minute IPA, 90 Minute IPA, Indian Brown Ale, Raison D’Etre, Midas Touch, Palo Santo Marron and Burton Baton. Together, they account for 82 percent of the company’s total volume.

Dogfish Head’s total barrel shipments to wholesalers also grew 20 percent in 2012. The company shipped 172,617 barrels in 2012, surpassing its original projections by about 2,500 barrels. The sales recap indicated that two-thirds of the company’s sales came at the off-premise, which grew 20 percent. At the same time the company’s on-premise business, which makes up the remaining 34 percent of sales, grew 25 percent.

Much of the growth in 2012 came from 4,100 new points of distribution for its number one packaged brand – 60 Minute IPA. During the same time, the company increased its turns by over a half case and saw no dilution from added shelf placements.

“It tells me that our distributors went out and put us into the right accounts,” said Lambert.

And there’s soon to be more where that came from: According to Calagione, the company has an expansion on tap that will eventually allow Dogfish head to brew up to 400,000 barrels per year.

Some other selected numbers from Dogfish Head’s year-end wrap-up are listed below:

  • Total case equivalent depletions grew at an annual pace of 22 percent.
  • The company’s fastest growing seasonal brand was Festina Peche, growing 51 percent. The fastest growing “occasional” brand was 120 Minute IPA, growing 82 percent.
  • Dogfish Head sold 3,900,426 four packs in 2012 at an average ABV of 9.1 percent.
  • 51% of the company’s total volume was sold within the surrounding states of Delaware. The markets it classifies as its “home markets” (DE, PA, MD, NJ, VA, DC, NY) grew at an annual pace of 20 percent.
  • 10 of 27 states Dogfish Head beers are sold account for 70 percent of total business.
  • IRI Scans: The company’s average price per case was second highest among the top 11 ‘Brewers Association’ defined craft beer brands.

Brewery: Dogfish Head Craft Brewery Website: http://www.dogfish.com
Address: 6 Cannery Village Ctr
Milton, DE 19968
United States
  • RoboTim

    I think this article is a good commentary on keeping companies private – as in not publicly traded…I love these details being made public!

    If this were Sam Adams, or any publicly traded company and they suddenly announced, “well, we’re not growing as fast as we used to and we don’t plan on ever growing that fast again. Oh also, we don’t plan on ever being the largest company in our industry either” You’d have a mass exodus from their stock and you’d have shareholders calling for Calagione’s head!

    Thank the sweet god of hops that we can interpret these comments as any rational person would. That Dogfish is committed to growing its business in a sustainable, responsible fashion while also delivering an ever innovating product.

  • JT

    @ec7fd88e07c47170e01de5c99a95f353:disqus – Amen.

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