# Distillery Equipment Financing Fundamentals

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Last modified: 2026-05-29T19:39:17+00:00
Type: efin_guide

## Summary

Distillery Equipment Financing Fundamentals. Comprehensive guide.

## Content

Distillery equipment financing covers stills, fermenters, aging barrels, and supporting equipment used by craft distilleries, regional distilleries, and contract distillers.

Equipment categories and typical financing

EquipmentTypical priceUseful life
Pot still (200-500 gal)$80K-$250K30+ years
Column still$100K-$400K30+ years
Combination still system$200K-$700K30+ years
Fermentation tanks$5K-$30K per tank25-30 years
Barrel inventory (per barrel)$150-$80020-30 years
Bottling line (small)$40K-$200K15-20 years
Aging warehouse (rackhouse)$200K-$1M+30+ years


Industry-specific considerations

Federal TTB licensing. Distilleries require federal TTB Distilled Spirits Plant permit. Lenders verify before funding.
Long aging timeline. Whiskey ages 2-12 years before sale. Revenue ramp is much slower than equipment payback period.
Aged inventory financing. Some lenders finance barrel inventory separately from equipment. Aged whiskey is bankable collateral.
Tax stamps and federal excise. Federal excise tax on spirits affects cash flow.
State three-tier system. Distilleries must work through state-regulated distribution networks in most states.

Typical financing terms


Rate range: 8% to 14% APR depending on credit tier and equipment age
Term: 60 to 120 months
Down payment: 0% to 25% depending on credit and equipment
SBA eligibility: Yes; SBA 7(a) and 504 programs are well-suited


Lender pool


Craft beverage specialty lenders: Live Oak Bank, Live Oak Public Finance
Specialty equipment finance for distilling equipment
SBA 7(a) and 504 commonly used for distillery startups
Community banks in distillery regions


What can go wrong


Industry-specific regulatory changes (emissions, licensing, safety) affecting equipment value
Customer or contract concentration affecting cash flow
Equipment age limits in lender underwriting boxes
Seasonal revenue mismatched with monthly payments
Inadequate maintenance reserves leading to deferred-service buildup


Action steps


Identify specific equipment with model and configuration
Get quotes from at least one dealer and any captive financer
Pull last 6 months of bank statements and 2 years of tax returns
Run payment scenarios at different down payments
Consider soft-pull prequalification before committing to a specific lender
Apply with distillery equipment specifics in the notes


See also our insurance requirements guide and Section 179 strategy for tax planning.