Duquesne chief applauds revived beer's 1st year, pushes for more

Joe Napsha
| Sunday, Aug. 14, 2011

Having survived his first year reviving Duquesne beer, Mark Dudash is optimistic he can build on his early success.

Without a traditional marketing campaign or the backing of deep pockets, multinational brewer, Dudash's Duquesne Bottling Co., sold 14,000 barrels of Duquesne Pilsner beer since it was restarted a year go this month, after being dormant since the early 1980s.

Dudash contracts the brewing and bottling with City Brewing Co. in Latrobe, which once produced Rolling Rock beer.

Dudash, an attorney from Upper St. Clair, and his wife, Maria -- who together run Duquesne Bottling -- say they are not satisfied with their results so far.

"I really believe that if you give (Western Pennsylvania) a great value at a reasonable price ... I can make a run at Anheuser-Busch, Coors and Yuengling," said Dudash, who is president of the company.

He is fond of pointing out that his first-year sales topped Boston Beer Co.'s 500 barrels of Sam Adams beer in its first year, according to its website.

Dudash is targeting sales of 25,000 barrels by this time next year, almost doubling production. He started with bottles, added cans this year and plans to offer Duquesne beer in kegs next month for tavern and restaurant customers.

"My dream is to have (the Latrobe brewery) running seven days a week on Duquesne beer," said Dudash, who worked at Pittsburgh Brewing Co., which produced Iron City beer years ago. "We're not here to run it and flip it for some one to buy us."

Duquesne Bottling was profitable in its first year, Dudash said. It did well enough to obtain a line of credit at First Commonwealth Bank, money from which they plan to use for expansion, Maria Dudash said.

Dudash said money generated by the business is being reinvested in packaging and distribution. It helped that for much of the first year, the company had no employees other than himself and his wife. Dudash recently hired one salesman.

"Mark has accomplished more in one year as an entry-level brewery, than the average person would do in five years. He's aggressive and very passionate about the beer. He's very consumer-oriented," said Jake Denis, owner of City Beverage in Altoona, Duquesne master's distributor in the Johnstown-Altoona region.

Duquesne beer has had "an exceptional year" as the beer-buying public has taken a liking to it. "In five years, the sky's the limit," Denis said.

In its second year, Dudash has plans to expand its sales territory and offerings.

Dudash plans to add a lager beer in the next 12 months to its "Prince of Pilsner" beer.

Dudash plans to expand Duquesne's reach from western, central and northwest Pennsylvania into northeast parts of the state -- Wilkes-Barre and Scranton -- along with northern Virginia outside Washington. He has added three more master distributors to the four he had in the first year.

He has supplemented online marketing efforts with Duquesne advertisements on television.

Building on success of the first year will not be easy, and there are no guarantees it can be maintained a second year, beer industry experts said.

"The challenge is that the market is so saturated. It is an extremely competitive industry," said Ben Steinman, editor of Beer Marketer's Insights Inc., a trade publication in Suffern, N.Y.

There is a lot of competition for customers in a market where beer sales are running 1 to 2 percent below last year, Steinman said.

Duquesne does have an advantage over national brands because its suggested wholesale price of $16.95 for a case should help in the tight market, Steinman said. By contracting out the production to City Brewing in Latrobe, "he can price his product more competitively," Steinman said.

The downside of lower prices is that "(profit) margins isn't as a good."

Duquesne has to take it "one step at a time," said Frank B. Fuhrer III, CEO of Frank B. Fuhrer Wholesale Co. of South Side, who is a master distributor for Duquesne beer. Some people who roll out a new brand want to match a Sam Adams or Yuengling beer in the first year, and that's just not realistic, Fuhrer said.

"So far, so good," Fuhrer said of Duquesne's first year.

Dudash is making the right move putting the beer into kegs so it gets to the restaurants and taverns, which introduces the beer to more customers. That gives the sales representatives the opportunity to focus on one package, before a new one is rolled out, Fuhrer said.

"The most successful brands are built slowly -- one step at a time," Fuhrer said.

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