diff --git a/app/models/enterprise.rb b/app/models/enterprise.rb
index ce14997734..a79ed0b88a 100644
--- a/app/models/enterprise.rb
+++ b/app/models/enterprise.rb
@@ -35,7 +35,7 @@ class Enterprise < ActiveRecord::Base
 
   scope :active_distributors, lambda {
     with_distributed_products_outer.with_order_cycles_outer.
-    where('(product_distributions.product_id IS NOT NULL AND spree_products.deleted_at IS NULL AND spree_products.available_on <= ?) OR order_cycles.id IS NOT NULL', Time.now).
+    where('(product_distributions.product_id IS NOT NULL AND spree_products.deleted_at IS NULL AND spree_products.available_on <= ? AND spree_products.count_on_hand > 0) OR order_cycles.id IS NOT NULL', Time.now).
     select('DISTINCT enterprises.*')
   }
 
diff --git a/spec/models/enterprises_spec.rb b/spec/models/enterprises_spec.rb
index 03c63261c9..dacf8bbd72 100644
--- a/spec/models/enterprises_spec.rb
+++ b/spec/models/enterprises_spec.rb
@@ -37,7 +37,11 @@ describe Enterprise do
         Enterprise.active_distributors.should be_empty
       end
 
-      it "doesn't show distributors of out of stock products"
+      it "doesn't show distributors of out of stock products" do
+        d = create(:distributor_enterprise)
+        create(:product, :distributors => [d], :on_hand => 0)
+        Enterprise.active_distributors.should be_empty
+      end
 
       it "finds active distributors by order cycles" do
         s = create(:supplier_enterprise)