Waters Edge makes wine sans vines
Father-and-daughter pair Charlie and Tiana Watkins plan to open a Waters Edge Winery & Bistro in Kentucky.
You don’t need a wheat field near your microbrewery to make beer, so why would you need a vineyard by your winery to make wine? You don’t, is the answer from Ken Lineberger, founder and CEO of Waters Edge Winery & Bistro, to the most-asked question about his 16-unit franchise.
Waters Edge allows operators to make wine without that pesky and time-consuming agriculture business attached. “We don’t grow the fruit, we make the wine,” he said.
“When the juice is shipped to each location, whether it’s chardonnay or cabernet, it comes in a stable airtight packaging so it won’t start to ferment until we get it,” he explained, adding he has sourced the grape juice from all the major growing regions around the world.
Operators typically make from 30 to 40 wines at the locations, from traditional varietals all the way to dessert wines. But don’t think it’s like that tragic dandelion wine your mother-in-law used to make in her basement. “The wine comes out great every single time and the proof is we offer tastings at all of our wineries,” he said.
Turns out most places make wine this way, by bringing in the grape juice from actual vineyards in other locales. “Even in California a majority of wineries don’t make their own wine. If you see the words ‘estate bottled’ that means they grew 95 percent of the fruit on property they completely own or control,” he said. As for the rest, they’re importing the juice just like at Waters Edge.
Operators import grape juice from around the world and then make wine in their own stores using special equipment.
A key feature of Waters Edge is the wine club, which costs between $30 and $60 per member depending on the location and creates a recurring revenue stream. Members get wines picked out for them, and complimentary tastings and discounts on food.
“When you walk in, you get the feel it’s a wine bar at first glance. But right behind the bar, we’ll typically put those bigger, 600-liter tanks, beautiful stainless steel,” he said. “People will say, ‘Wait a minute, you’re making wine here.’ That’s the showpiece of most of the locations.”
He works to train operators to tell the stories about their wines. “They understand the vineyards are 4,000 miles away but they get the story about the locality and the culture with every single one of our wines. The imagination takes off,” he said.
Charlie and Tiana Watkins are a father-and-daughter pair who will open a Waters Edge Winery in Elizabethtown, Kentucky, they hope by the end of this year or early next. Charlie is retired from the U.S. Army and now works at the U.S. postal service.
Tiana’s background is in accounting: “It’s a little father-daughter bonding experience,” she said. She will run the store day to day. “I’ll be making the wine, labeling, bottling, all the creative stuff. We’re going to make it a Kentucky winery, so special things that are related to thoroughbreds” will be incorporated in the store. Initial investment ranges from $300,000 to $500,000.
Ken Lineberger, founder and CEO, calls himself an enthusiast who drank “a heckuva lot of wine” before developing the concept.
As for his own interest in wine, Lineberger says, “I was a wine enthusiast. I drank a heckuva lot of wine,” while working at a software company for 20 years.
Lineberger points out most franchises are focused on craft beer these days. “The microbrewer has taken the world by storm,” he said, which he believes makes room for a wine-focused franchise. “There really is no one else in our space doing what we do.”
He cites Cooper’s Hawk as a similar concept, albeit more restaurant-focused and not franchised. Cooper’s Hawk just sold to private equity firm Ares Management for $750 million, he said, with 35 locations and claiming to have tens of thousands of wine club members.
“We’re very encouraged by that kind of growth,” he said, referring to the tidy sales price and adding with a laugh: “I’d take half of that.”