How to get your beer to the people – financing the next level

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Beer and vehicles of any kind should be kept as far apart as possible – unless you’re transporting those barrels of amber to the masses, in which case you should probably buy as many as you possibly can.

Well, having at least one truck or van will help.

If you’re a new batch or microbrewery that’s ready to take on the big time, you’ve probably figured you need to slap your logo on a big ol’ van or truck and deliver bottles of sparkling liquid happiness to your retail and wholesale customers. It costs less than shipping it – no, you don’t want to know how much that costs.

With breweries such as Dainton passing the one-million-litre mark, selling brewery fresh on the Field of Dreams model (build it and they will come) doesn’t quite cut it anymore. If you’re a business that sells products and needs to get it out to shops or convince shops to stock it, having a car, van, or truck can solve many of your problems.

With mo’ cars means mo’ beer; and you may want to expand your operations with new vats, barrels, canning or bottling lines, or taps to accommodate punters (remember those?) – and the best bet is looking for a chattel mortgage.

What’s a chattel mortgage?

If you’re a business and you are looking to finance equipment or vehicles and own them outright, you can apply for what’s known as a chattel mortgage. This may be interchangeable with “business loan” – but these could be other types of loans, hire purchases, and other arrangements. A chattel mortgage is a loan product built specifically for commercial purchases or cars used for business 50% of the time or more.

Chattel mortgages are different from consumer car loans because you can claim certain expenses on your BAS or tax – the instant asset write-off; interest paid; GST paid; and depreciation up to the depreciation limit. You could also claim the fuel input tax credit.

Bill Tsouvalas, Managing Director of Savvy says chattel mortgages are built for businesses as you can prioritise cash flow. “The good thing about these kinds of loans is that your business can borrow more than 100% of the equipment’s value, so you won’t have to tie up your operating capital. This means you can also finance installation and insurance too.”

Tsouvalas also notes that your business can choose seasonal repayments, shorter or longer loan terms, and include residual value payments. “Going to your bank might leave you disappointed in terms of flexibility. Your best bet is to seek out a business finance broker first.”

Grants (not the whisky)

If you’re a new beer or brewing business in some parts of Australia, you may be able to take advantage of grants or initiatives to promote the sector. NSW’s Independent Brewer Action Plan offers incentives and grants for attracting brewery workers and promoting Aussie brews to world export markets. You could also take advantage of COVID-19 recovery payments in your state as well.

Getting your beer to more people doesn’t have to come at your own expense – you can make the most of chattel mortgages and grants to take your brewery to the next level.

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