Waters Edge Wineries Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$519,092 - $1,339,058
Franchise Fee
$12,500
Total US Locations
12
Business Summary
Waters Edge Winery & Bistros are retail locations where wine is manufactured and sold. They also teach winemaking, sell wine accessories, and offer bistro-style food items such as cheese and fruit appetizers, salads, panini sandwiches, flatbread pizzas, desserts, and beverages like craft beer, coffee, and soft drinks.
Corporate History
Waters Edge Wineries, Inc. was formed as a California corporation on May 15, 2012. The company's principals have been involved in the wine business since 2004, operating a similar business. Waters Edge Wineries began offering franchises in June 2012 for its Waters Edge Winery & Bistro concept. The company previously offered a private branded store program, allowing franchisees to use their system under a separate trademark, but is no longer offering this option for new locations.
Financial Overview
Investment Range
$519,092 - $1,339,058
Franchise Fee (Low)
$12,500
Franchise Fee (High)
$50,000
Royalty %
5%
Marketing %
2%
Equipment Costs (Low)
$378,000
Equipment Costs (High)
$1,049,500
Working Capital
$30,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Waters Edge Wineries appears to be in good financial health based on its audited financial statements for the years ending December 31, 2023, and 2022. The company reported positive net income in both years, with $108,902 in 2023 and $688,366 in 2022. It also maintained strong positive working capital, indicating sufficient liquid assets to cover short-term liabilities. The independent auditor issued an unqualified opinion, meaning the financial statements are presented fairly in all material respects.
Financing Details
Waters Edge Wineries does not offer any direct or indirect financing to its franchisees and does not guarantee any notes, leases, or other obligations. Franchisees are responsible for securing their own financing.
Performance Metrics
Total US Locations
12
Franchised Units
12
Corporate Units
0
Avg Square Footage
5,500
Franchising Since
2012
Legal & Compliance Analysis
Recent Litigation
Yes
Bankruptcy
No
Litigation Count
2
Litigation Summary
Waters Edge Wineries has two concluded litigation cases. One case was filed on October 26, 2022, against a franchisee, Wine Vibes, LLC, and its principals, for breach of contract, trademark infringement, false designation of origin, misappropriation of trade secrets, and unfair competition. The franchisee counter-claimed for fraudulent inducement, anticipatory repudiation, rescission, novation, fraud, and misrepresentation. This case was settled on September 26, 2023, with the franchisee agreeing to pay Waters Edge Wineries $300,000, which could be reduced to $200,000 if paid in 10 yearly installments. The settlement included the dismissal of the complaint and termination of the franchise agreement. The second case is a concluded action from November 10, 2021, involving a Consent Order with the California Department of Financial Protection and Innovation. The Department alleged that Waters Edge Wineries violated an undertaking by paying down a promissory note during a registration period. Without admitting wrongdoing, Waters Edge Wineries agreed to comply with California Corporations Code section 31203.
Bankruptcy History
Waters Edge Wineries has no bankruptcy history to disclose in this FDD.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their Waters Edge Wineries & Bistro franchise agreement, franchisees must provide written notice of their decision to renew between 6 and 12 months before the current term ends. They must sign Waters Edge Wineries' then-current form of franchise agreement, which may include different terms and conditions, such as higher fees. Franchisees must have complied with the modernization requirements for their store, not be in default, and have satisfied all obligations on a timely basis. If leasing, they need to provide proof of their ability to remain in the premises throughout the renewal term. Additionally, franchisees must comply with current training requirements, pay a $5,000 renewal fee, and sign a general release of claims.
Training & Support Program
Franchisor Assistance
Waters Edge Wineries provides extensive assistance to its franchisees. Before opening, they offer site selection considerations, general building and design requirements, and a list of approved suppliers for equipment, inventory, and supplies. Franchisees receive copies of the Operations Manuals and complete initial training programs. Ongoing support includes updates to the Operations Manuals and approved supplier lists, periodic visits to the store for consultation, and refresher training courses (for which fees apply). Waters Edge Wineries also manages an Advertising Fund, may offer pricing policy suggestions, develops new products and services, and may establish a toll-free telephone number for customer orders and service.
Initial Training Hours
48
Training Location
Hybrid (Online and Rancho Cucamonga, CA)
Ongoing Support
Waters Edge Wineries provides ongoing support through regular updates to its Operations Manuals and supplier lists. They conduct periodic store visits to offer consultation and guidance. Franchisees are required to attend annual national conferences and may also be required to attend regional meetings, for which a fee applies in addition to travel expenses. Refresher training courses are available upon request or as required by Waters Edge Wineries, also for a daily fee plus expenses. The franchisor manages an Advertising Fund and may offer suggestions on pricing policies. They also develop new products and services for franchisees to offer and may establish a toll-free customer service number.
Franchise Requirements
Ideal Candidate Profile
Waters Edge Wineries seeks franchisees who possess strong personal character, skill, aptitude, business ability, and financial capacity. Ideal candidates, or their appointed General Managers, must be prepared to dedicate full-time, hands-on effort to the day-to-day management of the store, including direct on-premises supervision. The franchisor also looks for individuals with a passion for wine, an understanding of hospitality, and potentially some experience in the food service industry, who are comfortable with public interaction.
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Hands-On
Territory Type
Limited
Staff Count
12
Territory Size Requirements
Waters Edge Wineries territories, referred to as Designated Areas, are determined based on several factors including population base, population density, growth trends, local affluence, density of residential and business entities, and major geographical features like rivers, mountains, and freeways. Generally, a Designated Area will have a trade area with a population base of approximately 100,000, though this number may be lower in non-metropolitan areas.
Staffing Notes
Waters Edge Wineries franchisees must employ a General Manager who is dedicated full-time to the on-premises management and supervision of the store. Any new General Manager must complete the required training program. Franchisees are responsible for determining the number of additional staff (subject to any minimums prescribed by Waters Edge Wineries), their compensation, and all employment-related matters, while complying with applicable labor laws. All employees handling food must obtain and maintain food handler certification, and all managers (including the franchisee) must complete food management training from approved companies. Additionally, employees are required to wear uniforms imprinted with Waters Edge Wineries' trademarks, and franchisees must utilize an outside payroll service.