Brewery, Winery and Distillery Feasibility Study in Arizona

Larger loans, fewer producers

Arizona beverage manufacturing loans run large for the class and are scarce. SBA approved 43 loans for breweries, wineries and distilleries between FY2017 and FY2026, worth $37.9 million. The median of $500,000 is 1.72x the national class median, while the location quotient is 0.54x, so beverage makers hold a markedly lower weight in Arizona than in the nation. Arizona stands 27 of 53 on volume and the class holds 20 of 39 among its asset classes. The size ratio simply describes this cell and does not mark it out from the class.

Programs and places

Half of the loans fall between $185,000 and $1.2 million. Of the loans, 37 came through 7(a) and 6 through 504. No loan carries a franchise brand. Arizona Capital Source has 6 loans worth $964,000 and Live Oak Banking Company has 5 worth $4.8 million, a larger number of small loans at one and a few large ones at the other. Maricopa County has 17 loans, but Yavapai has 8, Pima 6 and Coconino 5, so these four counties account for most of the loans. Santa Cruz County has 3.

Cancellations and what the code cannot see

Cancellations among approvals of FY2017 to FY2024 have a floor of 14.7% and a ceiling of 17.6%. Arizona shows no charge-off rate, as the funded cohort there holds fewer than 30 loans, and nothing here implies losses are absent. Arizona's code records just the product, whether beer, wine or spirits, so any tasting-room or event revenue is invisible here. Annual approvals ran from 2 loans in FY2023 to 7 in FY2017, and FY2025 produced $10.3 million from 4 loans.

Questions for an Arizona project

A study should say which model it is: production for wholesale, a tasting room for visitors, or both. Each depends on different permits, traffic and seasonality. It should check brewhouse or still equipment, tanks and fit-out against a median near $500,000, and the cash tied up in inventory while product ages. Debt service coverage should be shown with slower distribution than planned. The median is well above the national one, so the appraisal, which will rely on equipment and real estate, deserves early attention. Visitor demand in Yavapai and Coconino should be supported with local evidence.