pros/ cons of leasing a truck

[lhall]

Hi guys,

When we first started operations, we worked out an arrangement with our distributor for them to pick up our packaged beer at the brewery for a small fee, which let me avoid having to buy or lease a delivery truck. Now our volume is up to where I could lease a truck of our own and actually save a little money versus continuing to pay our distributor to come get it. Even including fuel and insurance, it's a break-even thing right now, and will save us money as we grow.

But I'm wondering what other issues I am overlooking? Has anyone else out there been in this situation?

Cheers,

Linus Hall
Yazoo Brewing

[frigatebay]

You pay your wholesaler to pick up? Never heard of that before. Mine picks up (about 70 miles away, I contract brew) and he figures out the cost in his price to retailers. Hey if you can save money go for it. Anything to increase margins without sacrificing quality is a good idea.

[lhall]

Well, it's kind of the same thing - the freight cost is built in to the final price to retailer. If we get it to the distributor then we are responsible for freight, and we can recoup that freight cost to pay for our own truck.

[Butcher Scott]

There are some tax/depreciation/amortization issues to consider with this, you'll want to get with your accountant.

[jason.koehler]

I assume once he picks it up, then he is liable for any loss or damages. I'm sure it is not likely to happen, but should any product be lost/damaged/destroyed, during delivery, it would be on your books and not his should you go with your idea.

Just something else to think about.