East Craft West Craft
With
multiple Great American Beer Festival medals and two Small
Brewpub Brewer of the Year awards to his credit, Tomme
Arthur’s brewing talents are self-evident. A pioneer in the
wood and barrel aging movement, Arthur has long worked as
the head brewer at the Solana Beach location of the Pizza
Port Brewing Company chain in southern California. His
much-heralded Cuvee de Tomme, a Belgian-style sour red ale
inoculated with the Brettanomyces wild yeast strain, is one
of the great small-batch American craft beers. Long a pub
brewer, Arthur and his partners recently entered into an
agreement to take over a production brewery in San Marcos,
California, formerly run by the Stone Brewing
Company.
Brewer, rapper
and author Sam Calagione is so identified with his Dogfish
Head Craft Brewery that he hardly needs any introduction.
From 12-gallon batches to explosive, double-digit growth
unmatched by almost any other craft brewery, Dogfish Head is
briskly climbing up the list of America’s largest breweries.
Dogfish Head often seems like Calagione’s personal
playground, promoting quirky beers that few others would
attempt, delivering rap albums (the Pain Relievaz), and
inventing hoptacular beer delivery devices (dubbed Randall
the Enamel Animal). He infuses the craft beer industry with
an artful sense of enthusiasm, fun and cool.
In the first of
two parts, these two brewers not only discuss the business
of beer, including expansions, licensed pubs and new
releases, but also playfully take over the interview and ask
one another pointed questions.
ANDY
CROUCH These are
exciting times for both of your breweries, with a lot of
news and expansion. Tomme, let’s start with you first.
What’s happening with Pizza Port?
TOMME
ARTHUR It goes back
about eight months now. We’ve made some changes on the pub
side and have some new brewers working at each one of our
locations. We’ve also recently acquired the old Stone
Brewing Company facility in San Marcos (California).The Port
Brewing in San Marcos is going to be the real expansion
project that will allow us to do bottling and kegging. We’re
also going to have a new brand of beers called ‘The Lost
Abbey’. These are going to be cork-finished bottles, not
unlike a lot of the Belgian styles we’ve been
making.
It’ll be in
Southern California only to begin with. We won’t be shipping
six-packs of beer back East. If we’re going to come back
East, it’ll be with large format, bottle-conditioned, higher
alcohol beers – something with a little more shelf-life, a
little more interest. We don’t want to have six-packs of
Sharkbite Red sitting on the shelf for $8.99 for a long
time. We’re not going to drive volume sending beer to
Philadelphia, Washington DC and Boston on a six-pack level.
(The new brewery) gives us the ability to do about 5OOO to
7OOO barrels per year. However, we are making this
Mexican-style lager that takes a month of time in the tank,
so it will tie up some capacity.
AC
What was the idea behind the ‘Lost Abbey’ series?
TA
The idea belongs to Vince (Marsaglia), the owner. When I
first started with the company a long time ago, Gina
(Marsaglia) and I talked about this idea Vince had for this
brewery called ‘The Lost Abbey’. The thought was to make
Belgian-style beers and use the monastic name like the
abbeys and their tradition and to brand in that way. For the
last six years, we’ve been playing around with the name and
developing the recipes at Solana Beach. We knew that down
the road we’d rebrand and repackage them. It’s a nod to the
monastic brewers.We’re going to have three sets of beers
that fall into the abbey brand. One will be a regular set of
four beers that will be in 75Os and limited draft all year
’round. Everything else will come out either on a seasonal
basis or on an as ready basis. The other set of beers is
something we will call ‘non-denominational’ ales and lagers,
beers that are brewed to no particular style.
AC
So Sam, what’s new with Dogfish Head?
SAM
CALAGIONE We’re in
an expansion mode as well. The first phase is done and we’re
now at a little over 1OO,OOO square feet. We now have a
6O,OOO square foot warehouse space so our forklifts don’t
have to go by our brewhouse anymore, which wasn’t a good
idea. In August, we’ll have the installation of the
1OO-barrel brewhouse. We’re on a fifty barrel system right
now and will probably do 42,OOO barrels this year. I know a
lot of other breweries can get a lot more out of the fifty
barrel system, like Deschutes and Magic Hat. But our
challenge is that the average beer leaving our brewery is
9-percent alcohol, and you take a beer like 9O Minute IPA
and we’re getting maybe 22 barrels to the kettle per batch.
Right now we’re brewing six days a week, 24 hours a day, and
that’s all we’ve got until the new system comes on.The last
phase will be in 2OO7 when we’ll open the second brewpub in
the big brewery.
AC
Tell me a little about your franchised pubs.
SC
It’s similar to franchising. It’s a licensing agreement and
it works very cleanly. Essentially (the licensees) have no
ownership of Dogfish Head, they’re a bunch of restaurateurs
who had the Baja Fresh franchise in the mid-Atlantic. Two of
the partners had vacation homes down on the beach where we
live, so they watched Dogfish Head grow and visited our pub.
Then when they went to DC, they saw our beer gaining a lot
of momentum in that market. They saw an opportunity,
approached us, and we worked out what seems to be a very
well-functioning partnership. They are essentially the
managers, we receive a small licensing royalty fee based on
monthly revenue, and of course, we get the beer and
merchandise sales.
AC
How many pubs do you plan on licensing?
SC
Their goal is six locations by 2OO9, right around DC, and
then we’ll see if we can franchise that further. So far, so
good. Again, our challenge is capacity. They’re selling
about 16O kegs a month in their pubs, which is great but
embarrassing because our own pub has never sold that much.
Also, it’s screwed up our budgeting for 2OO6 because we
didn’t expect them to do so much. We’re now on a freeze of
new tap handles in our markets so that existing accounts
don’t run out of beer.
AC
In the last few years, Dogfish Head has built a name for
itself by releasing a slew of new products. What’s going to
be the role of new releases in the next few
years?
SC
Much to our chief financial officer’s chagrin, we’re not
slowing down on that sort of stuff. We can always use our
5-barrel brewpub for experimental beers. If there is
interest there, we extrapolate the recipes up. We’re going
to keep f-ing around and doing the fun stuff. We just have
to recognize that the strong beer we brew is probably six
weeks in the tank, which is just killing our capacity
because we’re on an allocated budget.
TA
Can I jump in here?
AC
Sure.
TA
How do you feel about continually having to reinvent
yourself? On some level, I feel like when the New Year rolls
around, we have to do something new.
SC
Because it’s expected of you.
TA
Yeah. You have all of these ideas and then it’s just a
matter of playing them out in your head and figuring out
which one is the best to come to market with. There’s plenty
of things that I want to do, but I don’t have the technology
to do them.
SC
For us, it’s really subjective how big a factor this has
been in our growth. It’s really an important thing to me
because it allows our sales people, distributors and loyal
customers to always have something exciting to talk about.
And that is really important when you go in to a retailer
and the question is, ‘What have you got for me? What’s new?’
Even if it’s not current, it may be coming up and it keeps
excitement going around at your company. I think we’ll
always do it and, like you, I have a bunch of things I want
to do in my head and the list is backing up. I don’t know if
we’ll always be able to do it to the extent that we do it
now, but I hope so. I plan on growing the company in a way
that allows us to do that.
TA
Do you ever see a point when you wouldn’t be able to keep up
with that?
SC
The thing that is hard is that these are my babies and at
some point you have to get rid of a beer to accommodate a
new beer. Not just for capacity but for packaging and peace
of mind. That is why I love the 75O-milliliter package
because it is not a six-pack and it’s just the cost of the
labels anytime you want to do something fun. So I think
we’ll lean towards specialties in big bottles than
six-packs.
AC
Along the lines of what Tomme is talking about, with you as
the iconic face of Dogfish perhaps more so than any other
craft brewer, how long can you keep it up? How long can you
maintain being the out there force promoting the
brand?
SC
It’s what I like in our company. I like the new brands, the
marketing, sales, packaging design. I wouldn’t be able to do
what I’m doing right now if I didn’t have amazing brewers
and our chief financial officer, who is as responsible for
our success as anyone. I have someone in our company who is
the king of costs that allows me to be the king of revenue.
It took me a while as the president of the company to learn
to sit on my hands and bite my tongue when I didn’t agree
with his decisions on the cost side of our company. What’s
cool is that you see him making decisions on the purchasing
by working with the brewers and saying, ‘Ok, that’s why that
barley costs seven cents more per pound. It’s going to help
the quality of the beer so go ahead and spend the money.’ As
long as he is making decisions that are for the best of the
beer and not for the best of the bottom line, he understands
that in the long-run, that is what makes the bottom line get
better and keeps our company strong. So I don’t see myself
getting sick of what I’m doing for a long time.
AC
So what about you, your role is changing here?
TA
Yeah, it’s the first time in nine years that I won’t be the
head brewer in Solana Beach. I realize that I’m graduating,
getting a really cool brewing system, and having a lot more
room. You have to remember that we’re making two oak barrel
batches of something every year and now I’m going to make
2O. That’s exciting as hell, but the reality of it is that I
don’t get to screw around anymore like I used to. And now I
have a real job with distributor issues and production
times.
SC
And a batch of beer is worth tens of thousands of dollars if
a beer doesn’t go the way you want it to.
TA
Yeah, it’s a different reality for me. When I started
working in the brewery business, I had butterflies going
into work every day that I would do something wrong. Then,
at some point, you get into a level of comfort and it stops
challenging you. A few years ago, on the pub side, things
stopped challenging me because there wasn’t a lot left to
prove. With the bigger brewery, I’ll have to learn all the
new things. At the same time, I’m very excited about all of
the new brand stuff. I’m really enamored with the Abbey
series. We’re going to use the Port Brewing brand to pay the
bills. These will be the three or four beers that will allow
us to screw around.
It’s a totally
different life-feel, but at the same time it’s very
exciting. We’ve been out on the road promoting, which is
something I look forward to doing. It’s a challenge to be
away from home, but I’m now an owner in a company and I’m
expected on different levels to do different things. I do a
lot more speaking than Gina or Vince does because I have
more of a presence on a level when we go to those markets
that I have to be that guy. I don’t have to be you. I’m
never going to be you. No one . . .
SC
Wants to be me? (Laughs). Not even me sometimes.
TA
I think that no one is trying to be you. There are a lot of
us who are trying to be a face with the value that comes
from that.
