Would you like beer or soda pop? Maybe you'd rather keep your wallet closed and instead have a glass of tap water.

Beverage companies have felt the pain of the weakened economy as folks eat out less and shift to cheaper beverage options. North American carbonated beverage volume dropped 3% in 2008 and 2.1% in 2009. The following two beverage companies are among those who haven't strengthened their balance sheets in case of an economic perfect storm.

A balance sheet buzzkill
Craft Brewers Alliance (Nasdaq: HOOK) is a collaboration of smaller craft beer companies, including top names such as Redhook, Kona Brewing, and Goose Island. Sounds tempting, eh? It shouldn't. The CBA has no cash (and I mean this literally; the company had only $13,000 in cash in its last reported numbers). Combine this with $19 million in debt, a quick ratio of 0.50, and a current ratio of 0.90, and the initial beer buzz on this stock is somewhat short-lived.

Like my fellow Fools, I think the craft brew space is an interesting play and could be lucrative. However, I'm not so sure that CBA is it. Anheuser-Busch InBev (NYSE: BUD) owns 35% of CBA, which could be good or bad depending on your perspective. Look at what Anheuser-Busch did to Rolling Rock.

A few years back, Bud bought Rolling Rock in what turned out to be an ill-fated entry into the craft brew space. A big part of the Rolling Rock brand was that it was brewed with water from the rolling streams of Latrobe, Pa. So what does Anheuser-Busch do shortly after purchasing the brand? Move production to New Jersey. Niche brands such as Rolling Rock rely on a loyal fan base: These folks actually care about not only what the product tastes like, but also what the brand stands for.

Craft Brewers Alliance boasts a five-year revenue growth rate of 34.7%, but at a 53.20 trailing-12-month P/E, this stock is way too rich for my blood. One misstep (like Bud's Rolling Rock fiasco) and this company could find itself with a painful hangover headache. Boston Beer Co. (NYSE: SAM) looks to be a much stronger (and safer) play in this space.

Caught in a cash crunch?
When I was a kid, I developed a taste for the sweet concoctions made by Cott Corp. (NYSE: COT). You might not see Cott's orange soda (my all-time favorite) on your supermarket shelves these days, but the company still makes a wide range of soft drinks, bottled waters, teas, and energy drinks, specializing in private-label/retailer brand soft drinks.

Time has not necessarily been kind to Cott, which has generated negative sales growth over the previous five years (-1.73% versus the industry average of 4.21%) and subsequent five-year net margin of -1.2% (the industry average is 8.3%). The company currently holds $35.4 million in cash on its balance sheet, but inventory has ballooned by 107% over the past nine months to $206.2 million.

Cott completed its acquisition of Cliffstar Corp. in August 2010, increasing its long-term debt by 162%, to $606.6 million. Cliffstar also concentrates on private-label beverages, so I'm sure Cott is looking to find cost and brand synergies without sacrificing its core business.

As folks "trade down" for cheaper products across the consumer goods space, private-label makers such as Cott aren't inherently a bad deal. However, with its recent growth and margin performance, the company hasn't shown the stability to thrive on its own, let alone integrate a new piece into the puzzle. Cash king Hansen Natural (Nasdaq: HANS) would be much better plays in the non-alcoholic beverage space.

Now what?
As we've seen with the tobacco industry, stock performance can skyrocket even with minimal (or negative) volume growth. If you are interested in investing in the beverage industry, take a look at the top dividend-yielding companies and consider industry stalwarts like Coca-Cola (NYSE: KO). Smaller players like Craft Brewers Alliance and Cott can be profitable investments in larger industries, but low cash positions and high debt make the risk-reward proposition for these investments too high.