SBA 7(a) Brewery, Winery and Distillery Feasibility Study in Michigan

Michigan beverage makers under 7(a)

Michigan had 129 SBA 7(a) loans for beer, wine and spirits manufacturers between FY2017 and FY2026, totalling $62.1 million, and the state's rank by loan count is 8 for the pairing. Inside Michigan the class stands 14 of 39. The median loan is $209,000, which is 0.84x the nationwide figure, with a central band from $50,000 to $638,600. Franchising is nearly absent at 1.6% of loans. No metric in this cell departs from the state's lending and the national class together by the required margin, so its particulars are lenders and geography.

A lender concentration worth noticing

The Huntington National Bank holds 49 of these loans, worth $10.4 million, while Fifth Third Bank trails with 8 loans and $6.1 million and ChoiceOne Bank with 6 and $1.0 million. One institution holds 49 of the state's 129 loans, so the data reflect it heavily. Wayne County has 14 loans, Kent and Oakland 13 each, Ottawa 11 and Berrien 8, with Grand Traverse, Macomb, Monroe and Saginaw at 5 each. Volume swung year to year: 26 loans in FY2018 were followed by only 6 in FY2019, and FY2026 closed with 7 loans and $7.2 million.

Michigan producers approved from FY2017 to FY2024 dropped out before funding at a floor of 8.0%, and at up to 8.8% if undisbursed loans count as drop-outs. The funded FY2017 to FY2021 group has 67 loans; of those, at least 7.5% are written off so far and 3.0% were lost within five years. That write-off floor is the highest of the cohort measures here, though it is still a minimum and open loans can add to it.

Testing a Michigan producer request

The class is defined by what the borrower makes, so taprooms, tasting rooms and events are not visible, and wineries are placed in this class. A Michigan study must therefore examine the whole business: production capacity and equipment, ingredient supply, licensing, and the share of sales coming from on-premises visitors compared with distributors and retailers. Seasonality deserves special attention, and cash flow should be tested through the weakest season. Equipment and build-out are specialised, so the appraisal must treat resale value with caution and distinguish real estate from the brand and going concern.