Oregon winery expands into restaurant business

Published 4:30 pm Monday, May 9, 2022

LAKE OSWEGO, Ore. — Wine is often intended to enhance the flavor of food, but Willamette Valley Vineyards wants to prove the inverse is also true at its new off-site restaurants.

“The food is there to highlight the wine and showcase the wine,” said Carissa Cook, the Oregon-based company’s development director. “The food will be a support to the wine.”

The company recently opened the first restaurant in Lake Oswego, Ore., and plans to open two more this year, in Vancouver, Wash., and Happy Valley, Ore. A fourth restaurant is planned for next year in Bend, Ore.

Jim Bernau, the winery’s president and CEO, does not plan to stop there, ultimately aiming for 50 locations, Cook said. “He wants them all over the country eventually.”

Food is already served at a full restaurant at the company’s headquarters near Salem, Ore., where its impact was big enough to help spur the broader investment in off-site eateries.

“We found the customers stay a little longer and spend a little more when there’s a food component,” Cook said. “They’re doing that because they form a connection with this wine.”

Memorable food experiences while people sip Willamette Valley Vineyards wines are expected to strengthen the company’s brand, but the restaurants are meant to substantially boost its revenue as well.

Each location is projected to generate more than $2 million in wine and food sales, including the bottles that customers buy to take home.

Last year, the publicly traded company had nearly $32 million in revenues, so if the four initial restaurants perform as planned, they’d increase sales by roughly 25%.

“We definitely expect significant bottle sales through here,” Cook said. “We expect to be hitting revenue with the restaurants.”

Restaurant visits are also expected to provide a longer-term sales lift, with each location projected to generate 600 wine club memberships a year. Club members are generally more loyal to the brand and buy more wine.

The restaurants will also feature a selection of beers and cocktails for non-wine drinkers, but will only sell wines produced by Willamette Valley Vineyards, seasonally highlighting varietals from across the state.

“It’s a chance to showcase the wines’ full potential,” Cook said. “This is really trying to create a brand experience.”

To emphasize wine sales, the restaurants will charge for glasses and bottles at the same price point as at the winery.

A glass of wine typically costs about four times more when purchased at a restaurant, so the savings for customers will be considerable, Cook said.

“We’re not doing a restaurant markup,” she said, noting that higher restaurant prices can discourage wine consumption with restaurant meals. “It’s hard when you know you can go to the grocery store and get the wine cheaper.”

Wine club members get 20% off the price of wines, while the company’s shareholders get a 25% discount. Both are given priority for reservations.

“Owners get the top echelon of perks,” Cook said. “We want to be sure they feel good about their investment.”

The restaurant locations were influenced by where the company’s shareholders live and the level of interest in food and wine experiences in the neighborhoods, she said.

As the company expands the restaurant concept, it will also have to examine whether other states’ laws allow direct-to-customer wine sales, Cook said. Some states require alcohol to be sold through a three-tiered distribution model.

The idea is to provide a destination for Willamette Valley Vineyards customers that’s more local than their occasional trips into wine country, she said. “We want to incorporate it into the everyday lives of our customers.”

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