Business finance for breweries & craft producers

Why brewing ties up cash

A brewery pays for a batch long before it earns from it. Malt, hops, yeast and packaging are bought upfront; then fermentation, conditioning and — for many styles — a period of maturation pass before the beer is ready. Only after that does it ship to a pub, bottle shop, distributor or supermarket, which in turn pays on 30 to 60-day trade terms. From ingredient purchase to cash in the bank can be many weeks, sometimes months.

Meanwhile the brewery's overheads — rent on the unit, energy for brewing and refrigeration, staff, duty and business rates — run continuously. The result is a working-capital cycle that's structurally long: cash goes out at the start of every brew and comes back near the end, with the whole estate of fixed costs ticking over in between.

Where the cash gets stuck

Brewing cash concentrates at familiar points:

• Ingredient and packaging buys. Malt, hops and cans or kegs are paid for at the front of a brew, well before the beer sells.
• The production and maturation cycle. Tanks are tied up for weeks per batch — capital sitting as work-in-progress, not cash.
• Trade payment terms. Pubs, distributors and retailers pay weeks after delivery, extending the gap further.
• Duty and fixed overheads. Alcohol duty, energy and rent fall due on their own schedule regardless of where a batch is in the tank.

What breweries use finance for

A frequent use is funding capacity that lifts output — additional fermentation or conditioning tanks, a canning or bottling line, or cold storage — so the brewery can take on more trade accounts or a supermarket listing. This is investment that pays back through higher volume, and matching it to finance keeps the cost aligned to the extra sales it generates.

Just as common is working capital for ingredients and a confirmed order: buying a large hop or malt commitment, or brewing to fulfil a wholesale contract, while waiting on trade customers to pay. Breweries also fund seasonal build-up ahead of summer or Christmas, kegs and dispense equipment placed in venues, and bridging slow-paying accounts. The healthiest borrowing is tied either to capacity that demonstrably increases output, or to a confirmed order whose margin clears the finance.

What to weigh before you borrow

Check the decision against your real brewery numbers:

• Match the term to the cycle. A long production-and-payment cycle needs a facility that clears in step with it — fund a batch and confirmed order with something that repays as the trade pays you.
• Capacity must find buyers. Extra tanks or a canning line only earn if the volume sells; size the investment to demand you can evidence, not hoped-for listings.
• Margin after duty and cost. Confirm the order's profit, net of ingredients, packaging, duty and energy, clears the cost of finance.
• Total repayable and flexibility. Get the full figure and check you can settle early if a strong trade run lets you.

This is general information, not advice on your accounts — test it against your own figures or with your accountant.

How short-term company finance fits — no personal guarantee

Credicorp lends to the limited company behind the brewery, with no personal guarantee — the facility is the company's liability, so your personal assets aren't pledged. As an exempt business lender providing working capital rather than regulated consumer credit, the focus is on how the business trades and what's contracted, which fits a producer whose value sits in tanks and trade orders.

For a defined investment like a canning line or extra tanks, a business loan gives a clear lump and schedule that the added output repays. For the rolling rhythm of ingredient buys and trade payment lags, the revolving Credicorp Flex line lets you draw per brew or order and repay as customers settle, paying only for what you use. You can apply online to see indicative terms first.