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Keg Deposits to distributors

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  • Keg Deposits to distributors

    Okay ProBrewer brain trust,
    How have other breweries handled it when you have kegs out to distributors (deposits paid) and your brewery ownership changes hands?
    Considering the old business goes on as usual with the new owners, how have the keg deposits been paid back to the distributors?
    -New owners communicate with old owners as kegs come back: old owners send check to distributors?
    -Old owners pay distributors in full, before closing and just hope the kegs get returned over time
    -Old owners pay new owners a check at closing to cover all outstanding deposits?

    Glacier Brewing Company

    "who said what now?"

  • #2
    Hey Dave,
    Kegs are assets of the business, and keg deposits are liabilities of the business. What this means is that when you bought the business, you likely bought the equipment (brewhouse, kegs, etc.) and the liabilities...which in this case is a 'loan' the distributor made to the company when they picked up beer and paid the deposit. If all of the liabilities weren't disclosed at the sale, or found in due diligence, you are likely still on the hook for those deposits anyway. My advice is even if you aren't (unlikely) pay them and get your kegs back. It costs far more to purchase even used kegs than it does to return deposit money to your distributor. You also want the distributor to understand that you run a professional business and that you understand their challenge.

    It is possible that you have some recourse with the person(s) who sold you the business, but the phrase 'buyer beware' comes to mind. Ask your lawyer