Maker's Mark Chairman Emeritus Bill Samuels, Jr., will be sharing his thoughts on the miracle of the bourbon industry and a bit of advice for business professionals Tuesday afternoon during the South Central Kentucky Business Expo at Cave City Convention Center.
Samuels' foray into the world of business and his family's immense success with bourbon came about by accident. Samuels had earned a degree in aerospace engineering in the 1960s, but got fired from his job in Sacramento, Calif., for incompetence.
“I got this brilliant idea I could come home and help Dad with his little hobby-that's what it was at the time,” Samuels said. “When I got there, I knew nothing.”
Samuels' father had started Maker's Mark in 1954, but made it clear to his family that it was simply a retirement hobby, not a full-fledged business plan. When Samuels started working at the company, 90 percent of Maker's Mark bourbon was sold within Kentucky, and another 5 percent to surrounding states. As time went on, Samuels said, he got “restless” and his father got “tolerant,” and they began expanding the business.
“Now we've got a retirement hobby worth more than a billion dollars,” Samuels said.
The tide turned for Maker's Mark when The Wall Street Journal published an article in 1980 about Maker's Mark and handcrafted bourbon.
“From that day, bourbon was top-shelf quality,” Samuels said.
Samuels is not the kind of business leader to look down upon his competition. The premium bourbon industry is a study in overcoming adversity, according to Samuels. Two decades ago, no one would have ever expected bourbon to be one of Kentucky's standout exports. Distilled spirits face a barrage of taxes, regulations and even limited sales avenues, unlike nonalcoholic beverages, wine and beer that can be sold in gas stations and grocery stories. In spite of the obstacles, bourbon is “the hottest distilled spirit in the world right now.”
“I'm proud as punch of everyone in our industry for doing the impossible,” Samuels said.
The bourbon industry has benefitted grain, barrel and labeling industries, according to Samuels, and it has brought an enormous bottling and packaging industry into Kentucky. Kentucky produces 10 percent of distilled spirits in the U.S., Samuels said, but it bottles 40 percent. Down the line, Samuels said he believes the bourbon industry will help fill the gap for the grain industry when the federal government stops its subsidies.
For Samuels, being successful in the business world is about stepping out of the box and trusting one's instincts about what the public will want.
“I totally believe the business people that succeed do not do what they teach you in business school, and that's to find an open niche and fill it,” Samuels said. “That's looking in the rearview mirror while you're driving down the road.”
Instead, business leaders should create a need, Samuels said, and understand that supply can drive the market more than demand. In his case, his family created a premium bourbon when no one was thinking about it, created the market for it and became successful. New business startups are essential to the success of individuals as well as the country.
“The minute we give up our edge in business startups as a country, we're gone,” Samuels said.
Take risks, and resist temptation, is what it comes down to. Samuels said he has always passed the marshmallow test, and he has observed that his successful friends always pass the marshmallow test as well.
The marshmallow test refers to a study in which marshmallows were placed in front of 5-year-olds. The children were told that if they waited for 15 minutes and did not eat the marshmallow, they would be rewarded with another marshmallow. Students who could resist instant gratification at such a young age went on to be successful as adults.
“Given the choice between instant gratification and longterm positive results, I have always opted for the longterm,” Samuels said.