What are some of the best options out there for financing a brewing system?


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Kinnek Knowledge Team

The two best ways to finance a brewing system are taking loans and leasing equipment. Although the needs of each business vary, obtaining a loan for a new or relatively young brewery may prove costly. A loan will require a down payment and affect the credit of an untested business. However, a loan will result in ownership of the equipment at the termination of repayment, and with recent growth trends in the brewing industry, resale value will likely rise.

Leasing equipment is perhaps the best option for a small brewery, as it will allow the brewer to gain firsthand experience with a specific system tailored to his needs. Additionally, the effects on credit and cash flows are initially much less than with loans, which will allow an untested business and product to enter the market with less financial risk. Naturally, leasing results in no ownership of the materials upon termination of the agreement, although it is entirely possible to loan or purchase the very same equipment at this time at this time, especially due to the high cost of transportation of brewing equipment.

Although the needs of each business are different, the more initial cash and credit a business can obtain, the more attractive a loan becomes. It is important to check with multiple financial institutions and industry-specific lenders to formulate a plan for your business, which may very well include both borrowing and leasing.

We'd love to hear anyone's personal experience with leasing equipment, and whether you ended up purchasing the components at the end of your term.

Nov 27, 2013

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