Whitehall Teams Up with Apple
World-Class Grapes
World-Class Technology
By David Levy
Whitehall Lane Winery in world-famous Napa Valley produces some of the finest wines sold today. Wine Spectator magazine has rated their cabernet among the top five wines in the world on three separate occasions. Every year, as many as 35,000 people visit the tasting room a few miles south of St. Helena, California. More than 4,000 customers have joined their prerelease wine club, and online sales have multiplied tenfold in just five years. To keep up with demand, Whitehall Lane's owners, the Leonardini family, have added 135 acres to the original 25-acre vineyard and purchased an array of Mac computers to manage every aspect of their rapidly growing business. But the situation wasn't always this rosy.
In 1993, when Tom Leonardini Sr. bought Whitehall Lane Winery from a group of foreign investors, success was not exactly a sure thing. The reputation of the wines had slipped during the previous ownership, and the winery building was in poor condition, with a leaky roof and hazardous wiring. "I walked around the first weekend," Leonardini recalls, "and thought, 'What the heck have I done here?'"
Repairing the winery's roof and reputation weren't the only headaches Leonardini had to deal with. The computer system was also a disaster. It consisted of IBM hardware and a $40,000 finance and accounting program developed exclusively for the wine industry. Unfortunately, it was so complicated no one at Whitehall Lane could use it. According to Leonardini, "There were these big manuals - ten of them! We were paying $400 a month for software upgrades, not including tech support, and we couldn't even write a check when the program operator wasn't here. I finally said, 'This is absurd.'"
A veteran businessman, Leonardini knew he needed a flexible, trouble-free system to track inventory accurately, manage orders easily, handle transactions smoothly, and stay in touch with customers and distributors.
A Simple Decision
Leonardini had been impressed by the absolute simplicity of the first Macintosh computer his son, Tom Jr., took to college in 1984. Even the youngest Leonardini, five-year-old Tony, could use it. "It was an obvious decision to replace the IBM computers in the winery with Macs," Tom Sr. says.
He purchased two new Mac computers, and bought MYOB accounting software and POS•IM sales and inventory management software. Then he paid a local Macintosh consultant $1,000 to create custom business forms, templates, and reports. Fourteen years and a few upgrades later, this cost-effective, easy-to-use system is still the solution they use to run a winery that's larger and busier than ever.
These days, Tom Sr. has a lot of help at Whitehall Lane. All five of his children work for the winery and the business now owns 16 Mac computers - seven PowerBook notebooks, three Power Mac G5 desktop computers, three iBook notebooks, and three iMac computers, networked through a PowerMac G4 that acts as a single, easy-to-use server. They're used to doing everything, everywhere, from managing inventory in the warehouse to making sales in tasting room. The Leonardini's have also set up AirPort networks at the winery and in their homes, so they're never out of touch with day-to-day business or each other. And the consultant? They don't need him anymore. Today, 95% of system maintenance is taken care of in-house.
Tom Leonardini says his Mac computerÐbased system delivers all the tools needed to run their business efficiently - and easily. "Everyone can use it. I'm sure the IBM system had tremendous capabilities, but you had to be an IT genius to figure it out - and we're in the business of making wine."
Sampling Mac Technology in the Tasting Room
In Whitehall Lane's tasting room, an iMac and a Power Mac G5 make up the core of the winery's point-of-sale system. Both Mac units are linked to bar-code readers, and receipt printers, so they act as cash registers. A database for future marketing efforts is automatically created when the customer's name and shipping address is entered at the time of sale.
Tom's daughter Kim Leonardini, who heads up retail operations, is enthusiastic about the this POS system. "New hires working in the tasting room learn the system in less than a day - even if they've never used a Mac before. We don't have to rely on a couple of experienced people to handle all the sales."
Sometimes the adaptability and simplicity of the system literally make the sale. "If someone wants to buy our wine for gifts," Kim says, "it's easy for us to ship to multiple addresses. Or use multiple credit cards. We've gotten a lot of sales just based on the fact that we can do what they want."
At the end of every business day, a report detailing tasting room sales, employee hours, and a breakdown of the drawer including tax, shipping costs, closings, and deposits is sent over the AirPort wireless network to the office manager, who verifies the numbers and imports them into the MYOB accounting file.
Connecting with Customers
Whitehall Lane has hundreds of thousands of customers, but the Leonardinis never lose track of any of them because each buyer's name and address is stored in the POS•IM database.
Whitehall Lane also manages a robust online business. Nearly 200 customers contact Kim Leonardini by email each day. She uses the winery's AirPort wireless network and her PowerBook to manage the constant stream of messages and orders from wherever she is in the winery.
When repeat customers email Kim, she accesses the winery's POS•IM database to call up their credit card information, address, and past transactions. Often she suggests a new wine based on their previous purchases, and makes add-on sales.
After office hours, Kim uses the AirPort network in her home. When an order comes in via email, she enters it into POS•IM remotely. The next morning, when the tasting room opens for business, Kim's email sales from the previous evening are already rung up.
"People say our email response is amazing," Kim says. "I check work email from home and respond to people at times they're not used to getting emails - at night and early in the morning. It's a big plus for customers to be able to get in touch with me after normal business hours."
Hearing It Through the Grapevine
To keep those orders coming in, Kim sends out email advertising "blasts" at least once a month. She creates them on her PowerBook using Vertical Response, a web-based email and direct mail marketing tool. "Direct marketing through email is a new thing for wineries," says Kim. "We've been in on that from the very beginning, and it's given us a competitive advantage over other wineries."
Four times a year, Whitehall Lane mails newsletters to thousands of customers. This could be a time-consuming task, but it's a snap because the information they need is already in their system. Kim Leonardini simply emails the customers' names and addresses from the POS•IM database to a local shop where the newsletter is printed. They run off mailing labels from her file and send the newsletter on its way.
Designing the newsletter is almost as easy as mailing it. Kim does the layout herself, using her PowerBook and QuarkXpress software. When the design is complete, she emails the file to the printer who produces the newsletter.
Whitehall Lane's new website is also driving business their way. Like email, these orders don't stop at 6:00 p.m. when the winery closes its doors. They come in around the clock. "I checked overnight website orders on my PowerBook while I was having breakfast one morning," Kim recalls. "My Dad was amazed when I told him, 'We made $11,000 last night while we were sleeping!'"
Paying attention to online business has paid off for Whitehall Lane. Since 2001, annual Internet and email sales have shot up from $100,000 to more than $1 million.
Collaborative Forecasting with Distributors
In addition to their booming retail business, Whitehall Lane also sells thousands of cases of wine to distributors all over the country. Often these sales are finalized before the grapes have been grown. Selling wine that hasn't been produced from grapes that don't yet exist could turn into a high-risk guessing game, but the Mac computerÐbased system makes it easy for Tom Leonardini Sr. to compare past harvest projections with actual production and forecast yields for the next five years.
He keeps data on every harvest since 1993 in his wide-screen, 17-inch PowerBook. It's easy to look at several spreadsheets at once and compare yield forecasts, sales goals, allocations, and past orders. Then Leonardini turns this information into customized PowerPoint presentations for each sales meeting.
"I review everything on the plane," he says. "Then I can start my presentation by saying, 'You bought the '01 merlot. How did you like it?'"
One final bit of information gathering remains. After reselling Whitehall Lane's wine, each distributor sends a Depletion Report to Tom Leonardini Jr. He tracks the sales, recording what wines were sold, which restaurants and stores purchased them, and how many cases went to each. This data becomes the starting point for future planning at the winery.
New Growth
There are many uncontrollable variables in the winemaking process - such as sun, rain, fog, or frost. But the Leonardini family business is thriving in spite of them, in part due to the seamless flow of real-time business information they can access quickly and easily on their Mac computers.
"We have no partners. No board of directors," says Tom Leonardini. "We run the business the way we think it needs to be run to make the best wine. If you concentrate on quality, everything else - pricing, profit, and sales - takes care of itself."
Tom's belief in the value of quality has held true for their computer system, too. If they'd kept the system that came with the winery, they would have paid out more than $70,000 by now just for software upgrades (not to mention hardware costs, consulting fees, and other related expenses like technical headaches). By switching to Mac computers, Kim Leonardini says, "we've upgraded our software and purchased new computers just twice in the last 13 years. It's safe to say that running our business with Macs has supported our growth at one tenth the cost."
In the years since 1993, Whitehall Lane has acquired some prime Napa Valley acreage, won prestigious awards and accolades, and grown into a world-class winery. In 2006, they'll be opening another winery a few miles away, on the Silverado Trail. This time it will be called the Leonardini Family Winery. Kim Leonardini says that Mac computers will be used "without question."
