Here at Shake and Strain Blog we’ve been following all news on ice as a integral component to a great cocktail experience and somehow every time we post something about it, it always leads to Richie Boccato (Dutch kills, PKNY, Hundredweight, Weather Up). And it feels that now the mainstream media is also catching up with this story. Forbes just published an article on Mr. Boccato commenting on his “backward integration” business model at Dutch Kills, who initially purchased ice blocks for their cocktails from a third party. As he explained at a seminar that I attended at Tales of the cocktail this year (see video) when difficulties in delivery and product quality started occurring he had the idea to take ownership over this task and integrate it into his bar. He did this buy purchasing Clinebell ice machines that would allow him to harvest clear and pure blocks of ice. The idea was so well executed that he started delivering to his other bars in NYC. The business grew until He decide to sell blocks of ice to other bars in the city by co-founding “Hundredweight” company which resides in a space next to Dutch Kills.
Quotes from Forbes:
“Spinning a new business off an existing one is a smart move”
“The minute one bar owner decided to control and harvest his own ice supply, he found himself with a new revenue stream.” “Supply yourself and then vend to others.”
“When entrepreneurs do a backward integration,” “they often change the rules of the game by controlling both the supply chain and also the price of the input,”
The three founders of Hundredweight are also the company’s sole sales force, but have relied more on word-of-mouth to instigate new business.
“Although all entrepreneurs should constantly be on the outlook for increasing their revenue streams, it’s often serial entrepreneurs who can spot opportunities because they’ve had more experience,”