Jeff Hamilton and Randy Sprecher don't want to be in the brew pub business.
That requires a lot of time and money, along with a set of skills different from operating Glendale-based Sprecher Brewing Co., where Sprecher is founder and CEO and Hamilton is president.
But this month's opening of the Sprecher's Restaurant & Pub in Bayshore Town Center, a five-minute drive from the brewery, is the latest step for a growing restaurant group that's helping Sprecher Brewing sell more beer to their diners while building name recognition.
That unusual arrangement benefits Sprecher Brewing, as well as Capitol Cuisine LLC, the Madison group that operates the Bayshore restaurant and three other Sprecher's restaurants in Wisconsin.
"We'd rather concentrate on brewing beer," said Hamilton, while Capitol Cuisine, led by Kevin Lederer, focuses on running the restaurants that use the Sprecher name and logo. The restaurants feature the brewery's beers and sodas, along with entrees paired with Sprecher beers and other items, such as appetizers, salads and sandwiches.
Capitol Cuisine, whose owners include Lederer's wife, Katy, and her parents, Felix and Kristin Richgels, pays a licensing fee to use the Sprecher name and logo. The first Sprecher's Restaurant & Pub opened in Madison in January 2010, followed by a Lake Geneva restaurant in December 2010, and a restaurant in the Wisconsin Dells area in July 2011.
The licensing agreement was reached after Lederer, a commercial property investor who also operates Capitol Real Estate LLC, contacted Sprecher and Hamilton. Lederer is a longtime Sprecher beer fan and wanted to create a restaurant with the atmosphere of a brew pub, without the expense and complications of brewing beer.
Hamilton said he and Sprecher "had a lot of hesitation" about the proposal. The biggest concern was protecting the quality of the Sprecher brand, Hamilton said.
Also, Hamilton and Sprecher wanted to make sure there wasn't a backlash from other restaurant and tavern owners who are wholesale customers of Sprecher Brewing.
After doing their due diligence on Lederer, and reassuring their wholesale customers, the brewery signed the licensing arrangement. The first three Sprecher's restaurants opened in former Houlihan's restaurant buildings owned by Capitol Cuisine after Lederer ended his operating agreement with the Houlihan's franchisee in late 2009.
The Glendale restaurant, scheduled to open Oct. 16, will be in space previously used by the Bravo Cucina Italiana restaurant chain. Capitol Cuisine is leasing that building from Bayshore's owner, an investment group led by New York-based Mall Properties Inc.
New sales venues
Since the first restaurant opened in Madison, there have been what Hamilton calls "adjustments."
That includes increased training for wait staff on the different styles of beers offered by Sprecher Brewing, and how they pair with various foods. But the arrangement has worked for both businesses.
Capitol Cuisine gets a well-known Wisconsin craft brewer's name for its restaurants. Sprecher Brewing was founded in 1985, making it one of Wisconsin's oldest craft breweries.
Meanwhile, the brewery is getting new venues to sell its products. Lederer estimates 95% of the beer sales at the restaurants are Sprecher brews.
The Glendale location will feature 16 Sprecher beers and four Sprecher sodas on tap, and menu items that use Sprecher brand barbeque sauce and mustard. It will include a small gift shop to sell Sprecher beers in packages and growlers, and Sprecher gear, along with a takeout window for food and Sprecher root beer floats.
"Our goal is to sell as much Sprecher product as possible," said Lederer. The restaurant will seat up to 350 diners.
Also, the four Sprecher's restaurants create what Hamilton calls a "sampling arena" for the brewery's beers.
"People come in and try new beers, and like them, and then buy them in a liquor store," he said.
Restaurant, brewery ties
Other craft brewers have ties to restaurants.
Milwaukee-based Lakefront Brewery Inc. rents a portion of its brewery to restaurateur Russell Davis, who offers Friday night fish fries at the Lakefront Brewery Palm Garden restaurant.
Also, some craft brewers that sell their beers at taverns and stores evolved from brew pubs. Those include Milwaukee Brewing Co., which started at the Milwaukee Ale House, and Chicago-based Goose Island Beer Co.
The type of licensing arrangement used by Sprecher Brewing is a more unusual tactic. Craft brewers that have done it include Dogfish Head Craft Brewery of Milton, Del., which licensed its name for three Dogfish Head Alehouses in suburban Washington, D.C.
A similar contract between MillerCoors LLC, the nation's second-largest brewer, and Milwaukee hotel operator Marcus Corp. has led to two Miller Time Pub & Grill restaurants, at the Hilton Milwaukee City Center, which opened in 2001, and the Cornhusker, A Marriott Hotel, in Lincoln, Neb., which opened over Labor Day weekend.
At the Bayshore Sprecher's Restaurant & Pub, which will have about 100 employees, the former Bravo space has been substantially remodeled. New touches include a large skylight in the middle of the restaurant and a more open bar area.
However, the meeting rooms for private parties will remain. Hamilton said Sprecher Brewing plans to sponsor dinners with beers paired with certain foods.
Lederer expects more Sprecher's restaurants to open, perhaps in the Fox Valley.
"I think we've created something you can take throughout Wisconsin," Lederer said. "We're definitely looking toward the future."