The Business of Summerfest

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For thousands of Milwaukeeans, it’s an annual ritual. You begin looking through the daily and nightly entertainment lineups for the 11 days of Summerfest and plot which shows you’d like to attend. You’re already thinking about the particular foods you plan to eat, the beverages you plan to drink, the stages you plan to visit and maybe even the picnic tables you plan to dance upon.

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However, in the Summerfest office, located on the Henry Maier Festival Park grounds at Milwaukee’s lakefront, employees kicked it into high gear long ago. Phone calls, meetings, orders, press releases, interviews, promotions, schedules, deadlines and more deadlines have put everyone involved in Summerfest in a frenzy since the snow melted in early April.

Summerfest is turning 40 this year, which for the festival’s organizers only adds more excitement and to-do lists to the ordered chaos.

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Similarly, such detailed plans are also required on the parts of dozens of local small businesses that rely upon Summerfest for a significant chunk of their annual revenues.

T.J. Anderson owns Martino’s, a Vienna beef hot dog and sandwich shop near Mitchell International Airport. The Big Gig is exactly that for him – he runs three hot dog stands on the grounds, two of which are concessions for the Marcus Amphitheater. Anderson brings in a semi-truckload of hot dogs for the 11-day stint and has Kohler-based Johnsonville Sausage LLC precook his brats.

Anderson is also gearing up and training his employees. Martino’s restaurant only employs 19 people, but Anderson needs about 85 employees to run his Summerfest operation smoothly, he said.

Meanwhile, Jim Luljack, the technical director for Summerfest since 1982, is getting in contact with the touring bands stopping at Summerfest to determine the amount of stagehands needed to load and unload trucks, operate lighting and sound and work stages to make sure everything runs smoothly at the concerts.

Luljack, who owns Milwaukee-based Theatrical Construction Service, is also part of the International Alliance of Theatrical Stage Employees Local 18, the union in charge of the sights, sounds and operations of the music side of Summerfest.

Ultimately, about 3,500 employees, many of whom are only along for the 11-day ride, work to pull off Summerfest each year.

“It is an unforgettable live music experience, it is the food, the drinks, the lakefront, the people watching, the fact that it is a Milwaukee tradition,” said Don Smiley, president and chief executive officer of Milwaukee World Festival Inc., which operates Summerfest.

Economic impact

This Milwaukee tradition also has become a hefty contributor to the City of Milwaukee and the State of Wisconsin in its 40 years of continued growth. Summerfest’s economic impact on Milwaukee totals about $110 million annually, which includes more than $61 million in direct impact and about $49 million in indirect impact, according to Milwaukee World Festival.

Summerfest is the world’s largest music festival, as it has held the Guinness World Record since 1999. Patrons may go for the music, but they stay for the food, the beer and the all-around experience.

Summerfest staples bring people in droves for their favorites, including Martino’s Chicago Style hot dogs; Saz’s mozzarella marinara and sour cream and chive fries; Venice Club’s fried eggplant strips; Major Goolsby’s burgers; Ultimate Confections’ chocolate covered pretzels; and Water Street Brewery’s craft beer.

The vendors themselves have become Summerfest landmarks and, in effect, household names outside of the festival grounds.

“What is nice is it is a two-way street,” said Tracy Spoerl, director of concessions for Milwaukee World Festival since 1978. “We lend credibility to the vendors and they lend credibility to us. In that, both are established, and so I think we help each other.”

In addition to a large food booth, Milwaukee-based Major Goolsby’s is in charge of all of the beer service at Summerfest. The restaurant normally employs 35 people but hires 800 employees for Summerfest, including 100 at the food booth and 700 servers and bartenders at the beer stations, said Jon “Bingo” Berta, festival manager for Major Goolsby’s.

Major Goolsby’s has had a food booth at Summerfest for 32 years. All vendors at Summerfest pay for their spots in the limelight through commissions of sales.

For Berta, one good day at Summerfest is more profitable than an entire week at Major Goolsby’s.

Anderson sells more hot dogs during Summerfest than he does in a month and a half at Martino’s restaurant.

Casper Balistreri, owner of Venice Club in Brookfield, who was one of the first Summerfest vendors, goes through one ton of eggplant per day of Summerfest.

“The volume we do at Summerfest, the restaurant could not match,” Balistreri said. “It is a very intense cash flow type of business, but we are still at the mercy of the weather and the gods have been good to us over the years.”

“Yes, we all do this for the money, but there a lot of other things you can do in life than kill yourself for 11 days for the money,” Anderson said. “There is something else that makes us continue to do this, and a lot of it is our name recognition. When people think of Summerfest, they think of fried eggplant and they think of mozzarella, and that carries over into other restaurants and other things we do.”

Saz’s popularity at Summerfest, which currently equates to the sale of more than 35,000 combo platters of white cheddar cheese curds, sour cream and chive fries and mozzarella marinara per Summerfest, gave owner Steve Sazama the opportunity to open a catering business and put his products in grocery stores.

“Because of Summerfest, we started doing 1,400 parties per year, and the grocery store division sells products to Sysco (Corp.) and Reinhart (Food Service Inc.),” Sazama said. “The mozzarella sticks are the 10th-largest seller in frozen foods, going up against the big guys.”

Sazama actually got his start at Summerfest working for Major Goolsby’s and opened Saz’s restaurant about the same time he started his own place at Summerfest. One of his managers, Lori Presser Murphy, broke off about 11 years ago, opened Ultimate Confections in Wauwatosa and one year later started selling sweets and ice cream on the Summerfest grounds.

Murphy’s chocolate-dipped strawberries and chocolate-dipped pretzels are hot commodities at Summerfest. Ultimate Confections easily goes through 1,000 strawberries per day at the festival, she said.

Festival goers also have made newer establishments to the festival grounds popular, including Crawdaddy’s, Charcoal Grill, Chipotle and JoJo’s Martini Lounge.

John Vukalic, owner of Crawdaddy’s, and Joseph Fugarino, owner of JoJo’s, find Summerfest the ideal venue to showcase new products or test them out in the marketplace. Vukalic introduces one to three new food items each year. Fugarino, who has a list of more than 500 types of martinis at his Wauwatosa location, chooses six flavors to offer festival goers, switching it up every year to keep JoJo’s fresh in their minds.

Bands and brands

“You have close to 1 million people to be able to expose service and product to and be associated with the No. 1 music festival in the world,” said R.C. Schmidt, a Milwaukee-based restaurateur and owner of Water Street Brewery and Louise’s, which have space at Summerfest. “We want to be associated with successful businesses and a successful image, and that’s what Summerfest gives us.”

So do the bands.

“Every year, our goal is to make Summerfest not necessarily bigger, but a more quality event where people feel they have been treated well,” said Howard Schnoll, chairman of the board of Milwaukee World Festival. “I think Don Smiley has accomplished this over the last three years he has been here. It is truly entertainment for all ages.”

Schnoll has served as chairman for five years but has been with Summerfest from the beginning. He previously owned Nankin Schnoll & Co., the first accounting firm hired by Summerfest. Nankin Schnoll was sold to Chicago-based BDO Seidman LLP. BDO continues to perform control work for Summerfest, and Howard Sosoff of the Milwaukee office serves as second vice president of the Milwaukee World Festival board of directors. By day, Schnoll serves as senior vice president of the Milwaukee office of RBC Dain Rauscher.

Summerfest aims to provide entertainment for all ages, but also at prices that everyone in the community can afford. Admission tickets cost $15 at the gate. However, there are plenty of promotions and donations customers can partake in, including ways to get in free every single day of the festival.

The Summerfest experience is also appreciated by the entertainers that play there, according to Bob Babisch, the festival’s entertainment director for 30 years.

“When people pay $60 to attend a music festival, they sit on their hands because they want to know if they will get their money’s worth,” Babisch said. “But the audience at Summerfest is ready to have a party, and that atmosphere carries over to the guys on stage.”

Artists such as Tom Petty, Umphrey’s McGee, Wilco, Paul Simon, Journey, Steve Miller, Kenny Chesney and Rusted Root have played Summerfest multiple times.

Lewis Black, a comedian, has performed at Summerfest for 15 consecutive years, Babisch said. Black’s first show outside of New York was at Summerfest. Now, Black is a fixture on comedy shows, including The Daily Show on Comedy Central.

BoDeans, Pat McCurdy and Spider George and the Web are among the local bands that have become part of the Summerfest tradition.

The Summerfest brand continues to grow on the Internet, with bands’ Web sites, blogs and social networking sites like MySpace.com, Babisch said.

Smiley’s goal is to build a national and international audience for Summerfest to keep the momentum going another 40 years and to take the festival to the next level.

Last year, Country Music Television (CMT) taped three concerts and one countdown show at the Harley-Davidson Roadhouse during Summerfest, and that footage continues to be replayed on CMT to its more than 80 million viewers, Smiley said.

“I think there is a lot of room to grow and to make it even better than what people have done over the years. They have done a great job, but I think there is a lot of potential in moving it to the next level,” Smiley said.

Bright future

The planning for the future of Summerfest never ends. Henry Maier Festival Park is landlocked, so demolitions and new buildings on the festival grounds are possibilities for the near future, Smiley said.

The Milwaukee World Festival board recently appointed a committee to look into the next grounds improvement project. It currently has $10.7 million in reserves for future capital improvement and plans to launch its next project on the south end of the property in 2010, Schnoll said.

“Like any business, if you don’t continue to make it better, you go backwards,” Schnoll said. “We want people to have the same experience as they do at Disney World where it is a clean, top-notch operation.”

“I think Summerfest has a very bright future,” Smiley said. “We have a great lineup of sponsors, we have very loyal ticket buying fans, the City of Milwaukee has been a great partner and I think by and large everyone understands the importance of Summerfest and what it means to our city, county and state.”

Milwaukee World Festival has grown to $34 million in annual revenue, $7.8 million in operating reserves and the $10.7 million in future capital investment reserves. Still, it has challenges, some of which the festival cannot control.

Bo Black, who served as executive director for Milwaukee World Festival for 20 years, building Summerfest into a massive success before Smiley succeeded her, used to ask the Sisters of Notre Dame to pray for good weather during the festival, Balistreri said.

The festival’s survival depends upon the weather. Attendance is low, food is wasted, bands are upset and profits are lost when the weather turns sour at Summerfest.

“When you book a band, you are committed via contract with the band. The band gets paid,” Smiley said.

One of the biggest challenges for Summerfest is the escalating costs for talent and content. Bands continue to increase their prices, and Milwaukee World Festival must accommodate for that through creativity with sponsorships, promotions and merchandise to keep the festival a community event and affordable to the masses, Smiley said.

“It would be like raising the rent from $30,000 to $1.2 million, and, of course, consumers and customers don’t want to hear that. They don’t want to be a part of that, but on the other hand, they want the very best music here that is available out there to sign,” Smiley said. “So, there is a balance you are trying to achieve at all times. Have the best music, provide the best quality experience at an affordable price.”

In the meantime, vendors are again bracing for the adrenaline rush that is Summerfest.

“We think at a different speed when we are at the restaurant than we do at Summerfest. I will mentally psyche up to speed to handle (June) 28th, then boom! You are off and running and before you know it, it’s Halloween,” Anderson said. “I look at my kids, and it is Christmas, then New Year’s, and I say, ‘Summerfest is around the corner. It is only six months away.'”

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