When evaluating your brewery’s finances one of the first questions you might find yourself asking is should we lease, rent, or purchase outright our kegs? The cost of purchasing kegs outright can be a daunting line item in the grand scheme of launching or expanding a brewery, but the liability of using rented kegs can be intimidating as well. Which option is right for your brewery depends on the size of your brewery, your growth stage and goals, and of course, access to capital. Brewery Finance can serve as your financial partner to help you accomplish these goals, but which option is best suited for your craft brewing business?
Pros and Cons of Leasing Kegs:
Much like leasing a car, leasing kegs allows you to get access to an inventory of kegs via smaller monthly payments. Most keg leases also have the option to rent to own the equipment or buy outright the equipment at the end of the lease. The main pro of leasing kegs is that less capital is required upfront and eventually you can own the kegs. The major con of having a fleet of leased kegs is the need to keep track of each individual keg’s ID and the potential liability if one of your kegs is lost. Breweries using leased kegs need to utilize tracking systems to keep tabs on each keg in their fleet.
Pros and Cons of Renting Kegs:
Similarly to leasing kegs, renting kegs allows growing breweries to get the equipment they need without the enormous upfront costs. Instead, smaller individual monthly payments are made toward the kegs. Unlike leasing, however, rented kegs must be returned to the vendor at the end of the rental period. The monthly payments are not applied toward eventual ownership of the keg fleet. Renting kegs is a good option for startup breweries that only need a small number of kegs and do not have the capital to purchase a fleet of kegs outright. The major con of using rented kegs is the liability of losing a keg and being on the line for the cost to replace it.
Pros and Cons of Owning Kegs Outright:
Purchasing kegs outright is the best option for large and expanding breweries with access to capital. By purchasing kegs outright there is no liability for lost or missing kegs. It is not necessary for breweries to track each individual keg ID and you can customize your kegs with your brewery’s branding. The biggest con of purchasing and owning kegs outright is the capital necessary to make the initial purchase. If purchasing kegs outright seems like the best option for your brewery, but funding is an issue, let Brewery Finance be your partner in accessing the capital necessary to make the purchase. We have experience helping dozens of craft breweries obtain the funding necessary to facilitate their launch and expansion. Contact Brewery Finance today to learn more.