Business loans for vineyards and microbreweries

Want to start or purchase a vineyard or microbrewery but need financing? Here's what you need to know.

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Breweries and vineyards cover an expanding market of people looking to have a unique, local experience with their drinks. But a love for brewing beer or cultivating a vineyard may not be enough when you’re looking to start or expand your business. Finding the right financing for your brewery or vineyard may be the difference you need to succeed in a crowded market.

Lending Loop Business Loan

  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $500,000
  • Interest Rate: Starting at 5.9%
  • Requirements: Annual business revenue of at least $100,000, at least 1 year in the business, minimum credit score of 600+
  • Borrow up to $500,000
  • Online loan application
  • Receive personalized interest rates

Lending Loop Business Loan

Lending Loop offers personalized loans up to $500,000 for small business owners who have been in business for at least one year and can show an annual revenue of at least $100,000.

  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $500,000
  • Interest Rate: Starting at 5.9%
  • Requirements: Annual business revenue of at least $100,000, at least 1 year in the business, minimum credit score of 600+
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What types of business loans should I consider?

Whether you’re already running a successful vineyard or microbrewery and you need extra funding, or you’re an aspiring owner, there are multiple business loans available.

Loan typeWhat it’s best used forTypical amountsBenefits and drawbacks
Equipment loanBusiness essentials like a brewer or wine pressThe cost of purchasing equipment
  • Covers the cost of purchasing major equipment like harvesters or brewery tanks.
  • Flexible repayment options.
  • Can be more difficult to arrange financing and may require a consultant or specialist.
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Term loanLarge one-time purchases and expenses$5,000–$1.25 million
  • Borrow a lump sum and pay it back over time.
  • Fixed loan repayments make it easier to manage your finances.
  • Covers major expenses and large purchases.
  • Exposes you to greater risks if your business fails.
  • Usually requires security.
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Invoice financingGetting an advance on invoices from contractors and other workersUsually up to 80% of an amount invoiced and awaiting payment
  • Use outstanding invoices as a form of security.
  • Can provide quick, relatively low-risk cash.
  • No interest rate.
  • Not an option for startups or new businesses.
  • Often comes with extra fees and charges.
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Merchant cash advanceRepaying in small, frequent amounts through future transactions$5,000–$300,000
  • A good option for a brewery needing a cash injection to fulfill a large order.
  • Use future sales to secure a loan.
  • Limited to businesses in need of cash to fill specific large orders.
  • Only useful for existing businesses.
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Line of creditExpenses that can come up at any time for virtually any purpose$10,000–$1 million
  • Interest is only paid on the money you spend.
  • You can negotiate fixed or ongoing terms.
  • Quick access to cash after approval.
  • Not suitable for major purchases and long-term business financing.
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CSBFP LoanFor large purchases or startup costsUp to $1 million
  • Competitive interest rates.
  • Can be used to buy or improve land, buildings, equipment or do renovations.
  • Must meet requirements of being a small business that grosses less than $10 million in revenue annually.
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Top business loan providers to compare

Name Product Interest Rate Min. Loan Amount Max. Loan Amount Loan Term Minimum Revenue Minimum Credit Score
SharpShooter Funding Business Loan
5.49% - 22.79%
$1,000
$300,000
6 months - 5 years
$5,000/month
450
SharpShooter Funding offers loans up to $300,000 for small business owners who have been business for at least 100 days and can show a minimum of $5,000 in monthly deposits ($60,000/year).
Lending Loop Business Loan
5.90% - 26.50%
$1,000
$500,000
3 months - 5 years
$100,000/year
600
Lending Loop offers personalized loans up to $500,000 for small business owners who have been in business for at least one year and can show an annual revenue of at least $100,000.
Company Capital Business Loan
7% - 29%
$5,000
$100,000
3-18 months
$5,000/month
N/A
Company Capital offers business loans of up to $100,000 to small business owners who have been operating for at least 6 months and can show a minimum of $5,000 in monthly revenue.

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What expenses do I need to plan for when opening a vineyard or a brewery?

Producing and selling wine or beer is a serious commercial undertaking, even at the smallest scale. You’ll need to factor in the costs of equipment, premises and licences when considering a business loan.

Consider your business first

The array of loan options can be confusing for both first-time business owners and those who have been in the industry for years. Consider your business needs carefully, consult with lenders and always read the fine print before you sign your loan contract. Your choice depends on multiple factors:

  • Your business situation. If you’re starting a business from the ground up, you might face bigger funding obstacles. If you already run a microbrewery or vineyard, you typically have more loan options because you can use your business, equipment or inventory as collateral and secure a more favourable loan, as well as meet less stringent eligibility criteria.
  • Your needs. Getting a loan to buy land and start a vineyard is a different prospect than getting a loan to purchase brewery equipment. A line of credit might be very helpful to cover fixed expenses for a few months, but it probably won’t fund a major renovation to your microbrewery.
  • Your assets and security. Do you own property? Do you have a significant amount of cash or other assets? If you have something you can use as security, your loan options begin to open up and you may even receive a lower interest rate than you would without collateral.

Basic startup costs

Microbrewery
  • Premises. You can’t brew craft ale in your bathtub. You’ll need a suitable premises in which to brew, store and possibly serve your lagers and ales. Consider factors like room temperature, ceiling height for your tanks and boilers, ventilation and drainage. Flooring is also important as liquid spills can erode some surfaces over time and possibly damage your equipment.
  • Brewing equipment. The list of essential brewing equipment is extensive and expensive. You’ll need boilers, cooling systems, kegs, fermentation tanks, cleaning equipment, bottling or canning machines, storage tanks and refrigeration systems.
  • Kitchen equipment. If you’re planning to run a microbrewery that doubles as a restaurant, you’ll need to add in all the equipment costs of a commercial kitchen and restaurant when applying for a loan.
Vineyard
  • Real estate. You can’t grow grapes without land. Your property costs are a major expense, but remember that the quality of the soil matters as much as the price. You should know where you want to buy and how well the land can support grape growth before you apply for a loan.
  • Vines. Good wine starts with good grapes. Look at wholesale vine nurseries to get an idea of costs. Your choice of vines and grapes depends on the soil, temperature and the market.
  • Farming equipment. You’ll need equipment like a grape harvester, mulcher and vine weeder.
  • Winepress and storage. If you plan on having a winery on site, you’ll need to purchase a winepress and barrels. You’ll also need bottles as well as bottling and labelling equipment.

Licensing costs

You can’t make and sell alcohol without a proper licence. You can apply for a permit with your provincial or territorial liquor commission. You’ll also need to consider any municipal or local laws surrounding the production of alcohol. Other considerations include a retailer licence, liquor licence and food production licence to produce your own alcohol and sell it on the premises.

Tax rates

The Government of Canada taxes the production of beer and wine, whether you’re selling it locally or exporting it internationally. Tax rates may vary depending on the province or territory that you’re operating in.

While it’s the federal government who regulate the manufacturing of alcohol, each province and territory has regulation over sales and distribution. This means you’ve got a lot to learn when it comes to manufacturing, selling and distributing your beer or wine in your specific province or territory.

What’s more, each province and territory has a differently named governing body for alcohol. For example, Alberta has the Alberta Gaming and Liquor Commission (AGLC) while Ontario has the Alcohol and Gaming Commission of Ontario (AGCO) and BC has the Liquor and Cannabis Regulation Branch.

Brand trademarks

Part of succeeding as a business is branding. If you create a distinctive, appealing and memorable label and name for your beer or wine, consider a trademark. Trademark applications are handled by the Canadian Intellectual Property Office (CIPO), a government body that oversees intellectual property matters. Trademarks can cost up to several hundred dollars, but when you’re building your business, they can be invaluable in helping you to stand out.

How costs can vary for different types of microbreweries and vineyards

When getting a business loan, it’s helpful to know exactly what category and company type you have. Knowing this can give you a clearer idea about what type of financing you need. Here’s a breakdown of the common types of microbreweries and vineyards and how it could affect your costs.

  • Brewpub. A restaurant and bar that sells the beer it makes on premises. When applying for a loan, you should factor in kitchen, staffing and brewing costs.
  • Microbrewery. A small-scale brewery that produces unique beers. Your microbrewery may sell beer directly to the public and offer tastings and food like a brewpub, or it may just brew beer for sale at local restaurants and markets.
  • Small-scale vineyard. A vineyard that grows small batches of its own grapes for wine production. Your costs will be lower, and many of this type of vineyard includes a winery for tastings and sales to restaurants. Developing a strong product and brand is key.
  • Micro-winery. A micro-winery isn’t attached to a vineyard, thus lowering the costs of running a full farm on top of the winery. These offer tastings to customers and sell wine within a small region.
  • Vineyard with a restaurant. Some vineyards have restaurants attached to on-site wineries. The costs are higher, and like a brewpub, you should apply for a loan that covers the different aspects of your business.
  • Tour-focused vineyard. The process of winemaking is fascinating to customers. One way of building your brand and creating demand for your wine is to open up your vineyard to tourists. You may need to hire extra staff for these tours.

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How do I decide which loan is best for my business?

Your business may benefit from a variety of loans, so consider:

  • The age of your business. Opening up a brewery will require lots of new equipment to start processing your beer, so an equipment loan is likely a great starting point for a new business. On the other hand, a vineyard that’s waiting for harvest may need a term loan to cover expenses until the grapes can be sold or processed into wine.
  • Your revenue. A line of credit may be useful for a vineyard that receives the majority of its revenue from the bulk sale of grapes and needs a flexible flow of cash during the off season. A brewery that makes its revenue from the sale of beers to local restaurants may require invoice financing while it waits for its invoices to be processed.

Bishop's End Brewery expands their warehouse

Bishop’s End is a microbrewery selling craft beer to restaurants across Quebec. The owners, Michael and Jayne, want to double beer production and open a restaurant on the premises. Space isn’t a problem and they have the funds to cover the cost of installing a kitchen, but they need to a buy a new brewing system in order to produce more beer. The system, including installation fees, costs $100,000.00.

With a 10.00% deposit in hand ($10,000.00), Michael and Jayne opt for an equipment loan. They get approved by an online lender for a 4 year loan with an interest rate of 7.25% and are able to use the brewing equipment as security.

Cost of brewing system + installation$100,000.00
Loan typeEquipment loan
Loan amount$90,000.00
Interest rate (APR)7.25%
Loan term4 years
Additional feesOrigination fee of 3.00% ($2,700.00)
Monthly payment$2,165.62
Total loan cost$106,649.58

*The rates, fees and terms listed in this case study are used as examples only. This information is for a representative transaction. The actual cost of the product may vary depending on the retailer and the specs of the product, among other factors.

How can I increase my chances of getting a loan approved?

Loan applications can be daunting, but the more research and preparation you do, the better your chances are of being approved. If your application is backed by expertise, experience, a solid plan and some assets, you may be able to negotiate better rates and financing options.

Here’s what you need:

  • A business plan. This is particularly important if your vineyard or microbrewery business is new. A detailed business plan reassures potential lenders and demonstrates that your business can actually go from plan to profit. Some banks aren’t willing to extend loans to alcohol production because of variable market conditions and regulations, so your plan should also detail how market fluctuations are dealt with and how you plan on abiding by all local, provincial and federal laws.
  • Security. Having property, cash or other assets to use as security makes it easier to negotiate a better loan. This is especially true when you need to invest in an equipment loan. Because the lender can use your brewing system or wine press as collateral, your rates will likely be lower than with an unsecured loan.
  • Skills and experience. Lenders take into account your experience, skills and qualifications and how they all relate to your business. If you’ve worked as a commercial brewer, you likely have the knowledge you need to run a microbrewery. At least ten years of experience in the wine industry will impress a lender if you want funds to open a vineyard or winery.
  • Financials. If you’ve been in business for a while, you’ll need to show a lender your financial records. These might include tax returns, a balance sheet, a profit-and-loss statement and a cash flow statement. This proves you can pay back your loan and have the income to cover future payments.

Bottom line

You don’t have to let lack of capital stop you from opening or expanding your business. Vineyards and breweries take a lot of work to maintain, but by knowing what type of funding you’ll need, you can impress a lender and take your business goals to the next level. Consider all available financing options when trying to decide what type of funding will work best for your needs.

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