Branching Out

Capitalizing on intellectual property can be tricky. These companies devised savvy solutions to various expansion challenges.

• American Ironhorse Motorcycle

  Original business: Custom-built motorcycle maker in Fort Worth, Texas
  Expansion: Biker jackets, shirts, hats, sunglasses, and bike accessories
  Biggest concern: Brand dilution. To avoid saturating the market and turning off loyal customers, CEO Wil Garland sells a limited amount of apparel at licensed bike dealerships. "We leave them wanting more," he says.
  Bottom Line: Apparel sales have doubled since 2002.

• Black Dog Tavern

  Original business: Restaurant on Martha's Vineyard, Massachusetts
  Expansion: Clothing, housewares, and pet accessories
  Biggest concern: Controlling costs. The company made a small initial investment in new products and funded the rest of the expansion organically.
  Bottom line: Black Dog now has 14 locations in New England, including six retail-only stores.

• Dogfish Head Brewery

  Original business: Commercial brewery and pub in Milton, Delaware
  Expansion: Barware, soap, books, clothing, movies, and CDs by in-house rap group the Pain Relievaz
  Biggest concern: Keeping it real. Owner Sam Calagione stays true to his company's "Off-center ales for off-center people" motto by creating humorous products, such as ale shampoo and thong underwear.
  Bottom line: Merchandise sales reached $250,000 last year.