Interface: Craig Culver

Culver�s restaurant co-founder and CEO is happy his chain is privately held, growing as planned and this year�s top-rated burger chain.

By Scott Hume, Editor-in-Chief -- Restaurants & Institutions, 9/15/2007

Craig Culver grew up in the restaurant business in Wisconsin, where his parents owned a series of supper clubs. In 1984, he and his wife, Lea, opened the first Culver’s restaurant in Sauk Prairie. Headquartered in Prairie du Sac, Wis., Culver’s Frozen Custard & ButterBurgers has more than 350 units. It won the Consumers’ Choice in Chains burger category this year for the first time.

Q. What was your reaction when you learned Culver’s had won?

A. It certainly put a smile on a lot of faces. We had to check it a number of times. Are you sure? I’ll tell you why we were excited and a bit surprised: We think a great deal of the other folks that are in the mix. I know Red Robin has a great culture and does a great job in their restaurants. And In-N-Out Burger, too, of course. We have great respect for both those companies and for many others in our industry.

Q. Will you look first at Culver’s Consumers’ Choice in Chains scores or at your competitors’?

A. We look at everything. We were third last year, and the year before we were second by three-tenths of a point on the overall score, but we didn’t do well on value. So there was one thing we knew we had to do. I don’t know quite how to say it, but we think we were getting a little pricey. We thought, ‘We’re Culver’s, we can do whatever we want.’ Well, we can’t. That taught us a couple of things and we took action.

One strategy, about a year ago, was to put out the Snack Pak. It’s a $2.99 meal: a single ButterBurger, a small fry and small drink. Did we get some fight back from our operators? You bet we did. We believed it was a smart thing to do. It’s not something we’re not going to make money on, because we are. I’ll sell those things all day long. We had a bit of a fight, but we’ve proved to our operators that this was a good thing for all of us.

Q. Was that decision driven by competition or by customer price sensitivity?

A. We had a number of things that told us. We did not want to get into the 99-cents business. That’s not us; we will not go there. We’re not going to put signs in the windows. Yes, we advertised the Snack Pak on television and had a translight on the menu board. I wouldn’t say we shouted it, but we let people know that you can come to Culver’s and you can eat for under $4.

Q. Have you made other changes?

A. Right-sizing meals. We believe strongly in that. We’ve offered sundaes in single scoop or double, or we’ll even go triple scoop if you want. We caught some hell on that, too, but we believed it was the right thing to do. We did the same with our malts and shakes, introducing smaller sizes.

Q. Does that present an operations challenge when you add size options?

A. Yes and no. That’s who we’ve been from 1984 on. Our menu has always offered variety. We come from rural roots where we couldn’t put up a limited In-N-Out-style menu. We just wouldn’t have made the bank payments. But primarily I like to think of us as a great burger chain and a great treat chain as well.

Q. How do you evaluate atmosphere and dining experience?

A. I look at atmosphere a number of ways. One is you can create it with the physical building. We’ve always had carpeted dining rooms and soft-cushion seats. However, there’s always an evolution, and we’re changing some things there. But atmosphere really is created by our team members. That has been a focus of ours for a long time.

I also look at cleanliness as part of the dining experience. And your Choice in Chains research shows that it isn’t as important with young people. And that just bugs me. It’s a focus of ours, and it’s very important to our older customers.

Q. Some Culver’s units have instituted "green" programs, such as using frying oil to power cars. How do franchisees react to such eco-friendly initiatives?

A. I’m certain there will need to be some education there. But I believe it’s the right thing to do. I also look at it as a business decision, and it’s a right business decision. It may cost something upfront, but down the road, I believe it will pay dividends. That’s the way I look at business. I always have. I don’t believe in grabbing all the money right from the get-go. Business is about making investments and taking the rewards down the road.

Q. There has been a surprising amount of change in corporate structures through mergers and acquisitions and public offerings. Have you felt pressure to find a merger partner or to sell?

A. I did, because I was getting calls. Daily. Private-equity firms, representatives of unnamed chains, you name it. I don’t want to do that very badly. We’ve resisted. I don’t want to be a public company. If we were going to start building restaurant after restaurant after restaurant, we’d have to go out and seek some capital. But I like our model and how we grow through franchising partnerships.

Q. Some chains are creating or buying a second or third concept. Are you ever tempted to create a flanker concept?

A. The temptation has struck, and we have done something. We actually do have a second concept. You probably don’t know about it because there’s only one. It’s called Blue Spoon Cafe. It’s right next to our offices in Prairie du Sac. It’s just a wonderful concept, and we’re about to open our second in Middleton, Wis., near Madison, right across the street from a Culver’s.

Q. How does Blue Spoon Cafe differ from Culver’s?

A. It’s a coffee-and-sandwich shop. There’s beer and wine, and there’s pizza. It’s neat.

Q. What about creating a downsized Culver’s for airports or college sites?

A. Well, that’s how Blue Spoon Cafe started. It was supposed to be a frozen-custard and coffee concept that we could put in airports and malls. But the Culver family never has been good about keeping things simple, so right away we threw in food and complicated things. But with Culver’s and Blue Spoon, we’ve got more than we can handle.