Is there a market for mocktails?
As of 2022, the market share for non-alcoholic beverages, thus encouraging more businesses to join. Demand for mocktails is rising and offering mocktails has become a “trendy” thing for bars and restaurants to do. Mocktails are also offered for purchase at most local grocery stores.
In fact, the non-alcoholic beverages market is expected to grow from $923 million in 2020 to upwards of $1.7 trillion by 2028, increasing at a compound annual growth rate of just over 8%.
The market for mocktails includes those in recovery, expecting mothers, athletes, those taking medication where alcohol consumption is contraindicated, those with religious beliefs that discourage alcohol consumption, business professionals on the clock, and anyone else who prefers to enjoy a sober experience.
Just like with alcoholic beverages, prices can be set between $5-12 depending on the garnish and presentation of the drink. For restaurants, serving mocktails offers a way to stand out and helps to boost brand identity.
Are financing options available for the mocktail industry?
Entrepreneurs can take advantage of a variety of financing options in order to get into the mocktail industry. Business owners can use credit cards, business loans, and even personal loans to get their new company up and running. Banks, credit unions, and online lenders are all viable options for obtaining your financing to get started in the mocktail industry. Comparing interest rates and other loan terms can go a long way towards saving money on your financing.
Common uses of mocktail industry financing
In addition to start-up costs, business owners also commonly use financing to expand their existing business. There are a few different ways you can use the funds from your loan or line of credit to enhance and improve your mocktail business. A few common uses of mocktail industry financing include:
- Solving cash flow issues
- Refinancing business debt
- Real estate
Benefits of financing for the mocktail industry
Whether you are just getting started or have been in operation for years, using financing for your business allows you to take advantage of expansion and growth opportunities even when you don’t have the funds upfront.
In the mocktail industry, financing can help you obtain inventory, market your products, and grow your reputation. It is vital to get into the market now to take advantage of future growth. One of the biggest advantages of financing is that it can help alleviate cash flow problems. While there may be costs associated with financing, if it can help your business generate more revenue it can easily be justified.
How mocktail industry financing works
There are a variety of ways mocktail companies can obtain financing. From traditional loans and lines of credit to crowdfunding, you’ll need to determine which option is best. Depending on the option you select, the specifics on how it works will vary. Some options may offer more flexibility than others. In general though, mocktail industry financing should provide funds for general business use or a specific business use. In most cases the funding is either paid as a lump sum, offered as a revolving line of credit, or paid directly to suppliers.
How much can I borrow for my mocktail based business?
How much you can borrow for your mocktail business will depend on the type of financing you decide to use.
Personal loans typically allow the borrower to receive funds in amounts up to $100,000.
On the other hand, business loans are available in amounts upwards of $1 million, depending on the lender. In fact, the average bank business loan in 2017 was $493,000.
As of 2020, the average credit limit on a business credit card was just over $56,000.
How much is the non-alcoholic beverage industry worth?
The non-alcoholic beverage industry was valued at $923 million in 2020 and is expected to grow to more than $1.7 trillion by 2028, increasing at a compound annual growth rate of 8.19%.
In addition to mocktails, the beverage industry has also seen a rise in non-alcoholic beers and even “dealcoholized” wines. Integrating a mocktail/non-alcoholic beverage into your menu can increase your sales and profits by a large percentage.
Is a license required to sell mocktails?
To sell alcohol, restaurants and other vendors must have a liquor license in all 50 states. Having a full-liquor license can be a huge moneymaker for many bars and restaurants. However, in most states, a certain number of seats is required to obtain a full-liquor license. Smaller restaurants may serve beer and wine but not full cocktails. Now, having the option of mocktails allows these small businesses to make more profit on their beverage menu.
On the other hand, since mocktails are non-alcoholic they do not require a liquor license although your business will still be subject to all other required licenses and permits to be in operation. For example, if you are opening a restaurant that sells mocktails, you will need to follow city and state ordinances around the regulation of operating a food business.
Similarly, manufacturers of mixed drinks and other alcoholic products must have a liquor wholesaler license in most states to participate in distribution to bars and restaurants. Distribution of premixed non-alcoholic beverages is not as regulated by the states and these mixers can typically be distributed according to state food distribution laws. Check with your state to see which types of licenses you may need to complete wholesale orders of your manufactured non-alcoholic mixed drinks.
Do I need to have a good credit score to obtain financing?
When it comes to securing credit for a business, lenders and backers often look at the business owner’s credit. In most cases you will need good credit to obtain financing. If you are lacking in the credit department, consider using secured financing.
What are the qualifications to get funded for my mocktail business?
Qualifications often get in the way of securing financing. Traditional lenders often have requirements that are black and white. They may not allow for the startup that’s well on its way to the top or the eCommerce seller. Therefore, mocktail companies may need to turn to alternative sources of funding for more relaxed requirements. In most cases, backers or lenders will have requirements such as length in business and revenue. One alternative for mocktail companies that need working capital for inventory is Kickfurther.
Kickfurther funds up to 100% of your inventory costs on flexible payment terms that you customize and control. With Kickfurther, you can fund your entire order(s) each time you need more inventory and put your existing capital to work growing your business without adding debt or giving up equity.
No immediate repayments: You don’t pay back until your new inventory order begins selling. You set your repayment schedule based on what works best for your cash flow.
Non-dilutive: Kickfurther doesn’t take equity in exchange for funding.
Not a debt: Kickfurther is not a loan, so it does not put debt on your books. Debt financing options can sometimes further constrain your working capital and access to capital, or even lower your business’s valuation if you are looking at venture capital or a sale.
Quick access: You need capital when your supplier payments are due. Kickfurther can fund your entire order(s) each time you need more inventory.
How to grow your business with Kickfurther
Kickfurther puts you in control of your business while delivering the costliest asset for most CPG brands. And by funding your largest expense (inventory), you can free up existing capital to grow your business wherever you need it – product development, advertising, adding headcount, etc.
Mocktail mixes industry financing is often needed for inventory. With Kickfurther you can fund millions of dollars worth of inventory at costs of up to 30% lower than the competition. It gets better though – you don’t pay until you start making sales. You’ll truly have the opportunity to create a payment schedule that works for your business. You’ll outline expected sales periods to create customized payment terms. With more than $100 million in inventory funded to date, Kickfurther can help you get funded within a day or even minutes to hours.
Interested in getting funded on Kickfurther? Create a free business account, complete the online application, review deals, and get funded in as little as minutes!