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Opening a Liquor Store

Dr. FrenchensteinDr. Frenchenstein Registered User regular
edited April 2012 in Help / Advice Forum
So a friend of mine and myself have been talking about opening a liquor store (or bar, i'm leaning towards a more sustainable liquor store, maybe expanding one day when we've got our feet wet) near his neighborhood. i live nearby, and it's a good neighborhood, with no liquor stores very close by. closest one is a ritzy wine store, that is super overpriced. He's got quite a bit of capital saved up, due to a workers comp claim. between a business loan and that i think we'd have overhead covered. i imagine stock is a pretty significant investment, beyond the usual stuff. Are there any pitfalls we should look out for? I know bar liquor licenses are hard to come by in our town (glut of bars), are retail licenses held to similar standards? My concern is that a lot of stores around are either hoity toity, or complete crapholes. I'm worried you either have to cut corners or overcharge to be profitable. Anybody have any experience?

Yes i realize, with my incredibly terrible luck, opening my own business is probably the last thing i should ever ever do.

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  • bowenbowen Registered User regular
    Eh your personal life and business life can be separate, there's no reason to expect that your business ventures will go south if your personal ventures do.

    If you're not sufficiently hurting for money I don't see why not. You should really come up with a business plan, what kind of partnership you're looking for (are you both going to be equally involved or are you just basically giving him a loan and expecting a return), etc. Liquor store license is probably the hardest part, so I'd put research and calls into the county/town about getting those and what it takes.

  • mtsmts Registered User regular
    the bonus is you will have plenty of cardboard boxes to sleep in when your house collapses in on itself

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  • bowenbowen Registered User regular
    mts wrote: »
    the bonus is you will have plenty of cardboard boxes to sleep in when your house collapses in on itself

    :^:

    At the best you can stay in the office/store room.

  • CelestialBadgerCelestialBadger Registered User regular
    edited April 2012
    mts wrote: »
    the bonus is you will have plenty of cardboard boxes to sleep in when your house collapses in on itself

    If you never take a risk in life, you'll never get anywhere in life.

    However, a nerd forum seems a strange place to ask for business advice. To get a business loan you will need more know-how than anyone here can give you. Do either of you have any experience in business?

    CelestialBadger on
  • ThanatosThanatos Registered User regular
    This is something that is going to vary tremendously from state to state. Make sure you know what you're getting into. You're almost certainly going to need a lawyer to make sure all of your licensing and certification is up to snuff (preferably one with experience in this sort of thing).

  • MetatradMetatrad Registered User regular
    edited April 2012
    There's a lot of little things and particulars to running a small liquor store. I'd reccomend working at one for a while before you'd even consider diving in to this.

    I don't know what state you're in, all I know is how it works in RI. Max hours are 9am-10pm mon-sat, 12-6pm sunday, you can't buy beer/liquor/wine anywhere else.

    Everything has to come through the distributors/salesmen. You'll live and die by your relationships with them. It all comes down to the case deals. Wine: You want only 5 or less cases, you're going to pay the shit price. 15 case deal, it starts getting ok. Most small stores have to ride that 15 case deal(Example: Woodbridge 15 case deal: 3 Merlot, 3 Cabernet, 3 Red Zin, etc., case deal is encompasses one brand but can have multiple types within the deal) line because of limited inventory space. The mid and large size stores are the ones that make the real money, because the salesmen actually give a shit about them, and they set up the good big-number case deals.

    Thankfully liquor and most wines will keep for years. Beer is where it's going to be the most delicate balance, factoring in your cooler space and your stockroom space. You'll have to choose carefully what craft stuff (as in slightly more exotic than Sam Adams) to put in your cooler doors Usually 3 months is your limit for the date on the package. It'll take a year to figure out what kind of sales volume you can get, and how much you have to stock, etc.

    Go in to stores that are the same size as the one you are opening, write down all the major items they stock, the prices, etc. It's all Business 101 from that point.

    Metatrad on
  • MetatradMetatrad Registered User regular
    edited April 2012
    woops menat to edit not quote

    Metatrad on
  • amateurhouramateurhour Registered User regular
    Having worked for an Alcohol Beverage Control board in the past, I can tell you one thing... If your state is one of the dozen or so states that still has state government run liquor stores and full control, DO NOT OPEN A LIQUOR STORE, OR A BAR!

    You will be in for more hassle than it will EVER be worth. You'll be constantly investigated by undercover agents to see if you're selling to underage kids and maintaining proper business licenses, you'll be scrutinized and zoned out of your mind when you try to build within 100 yards of a Church, you'll be fined, probably monthly, and continuously have to go to a hearing where your "board of peers" are employees of the agency in suits. (This is not a lie. It's like jury duty. Even the secretary of an ABC office has to occasionally put on a suit/dress and pretend to be an unbiased juror during a hearing where someone sold to a minor)

    If you're in one of the 30 something states that does not have state run liquor, then go for it.

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  • Dr. FrenchensteinDr. Frenchenstein Registered User regular
    I'm in MD/Baltimore City, so no state run shenanigans.

    As far as the venue of the question, this is like the only message board i belong to, and typically get good advice on a wide range of topics, so i figured what the hey.

    I would think we'd do %50 LLC, with some sort of stipulation for the differential in capital we're both putting into it or whatever. does anyone know of a good site to find retail space, or would i need to get in touch with a realtor? There are lots of storefronts scattered around his neighborhood, in varying states of misuse.

  • amateurhouramateurhour Registered User regular
    Realtor is going to be the best bet for that. Be up front with them about the business you're looking to run, otherwise you might have a situation where they thing you're opening a boutique and then the rest of the strip mall tenants decide the don't want a liquor store lowering the quality of their customer base and you're in the middle of lease paperwork you don't want to be in.

    Also, make sure, even with no ABC board, about ALL of the regulations in your area about selling alcohol, in relation to both nearby businesses, public areas, parks, schools, religious institutions, etc.

    I'm not going to lie, finding a spot to put an upscale liquor store is going to be a pain in the ass no matter where you live, but it's doable. Good luck man!

    Here's what I do...
    The Vac - My Science Fiction Epic
    Fortune Pancakes - My Gag-A-Day Comic
  • bowenbowen Registered User regular
    edited April 2012
    For instance in my local township thing you can't have a liquor store next to a grocery store, but half a mile up the road you can.

    :rotate:

    bowen on
  • ThanatosThanatos Registered User regular
    I'm in MD/Baltimore City, so no state run shenanigans.

    As far as the venue of the question, this is like the only message board i belong to, and typically get good advice on a wide range of topics, so i figured what the hey.

    I would think we'd do %50 LLC, with some sort of stipulation for the differential in capital we're both putting into it or whatever. does anyone know of a good site to find retail space, or would i need to get in touch with a realtor? There are lots of storefronts scattered around his neighborhood, in varying states of misuse.
    Talk to an accountant or tax attorney about what sort of entity you should be! There are advantages and disadvantages to various business models, which can (again) vary widely from state to state. You could be out tens or hundreds of thousands of dollars in the long-term (or even millions) for not investing a few hundred on talking to an attorney or accountant now.

    Like, if neither of you are married, and don't have substantial assets to protect, it's frequently better to go with a partnership, just because you have a much smaller bite taken out for taxes. However, you could lose your house doing that. I'll repeat that again: you could lose your house. That's a pretty serious upside for you.

  • bowenbowen Registered User regular
    edited April 2012
    Thanatos wrote: »
    However, you could lose your house doing that. I'll repeat that again: you could lose your house. That's a pretty serious upside for you.

    /grin

    I like you.

    bowen on
  • ASimPersonASimPerson And protect them from the evils of the world like trigonometry and prime numbers.Registered User regular
    Thanatos wrote: »
    However, you could lose your house doing that. I'll repeat that again: you could lose your house. That's a pretty serious upside for you.

    Just make sure that you don't too eager telling the collections agencies to just take your house, they might catch on.

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  • QuantumTurkQuantumTurk Registered User regular
    Ohhh don't throw me in that briar patch!

  • mtsmts Registered User regular
    edited April 2012
    this thread is full of win

    honestly if the market supports it a fancy pants beer/liquor store is awesome. back when i just graduated college, there was this amazing beer store that had individual bottles and six packs. high end stuff . tried in vain to google it but no luck.

    mts on
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  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    If neither of you have ever managed/worked in a bar, good luck with that one. You'll go down in flames. There might also be a reason that there's no liquor store in the area, namely, the neighborhood doesn't want one.

    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • Dr. FrenchensteinDr. Frenchenstein Registered User regular
    I worked in a liquor store for 2 years in college, i'm thinking there isn't a liquor store because there are a few package goods bars around that sell beer, albeit with overinflated prices. My real concern is location. no schools, but there are several churches. We both have houses, he's married, i'm not. It's a relatively blue collar neighborhood, but lots of high end rehabs, andthere are several "ritzy" developments popping up as well nearby. Perhaps my next call is to a realtor!

    The licensing is another concern, i know it's pretty much impossible to get a new bar liquor license in the area, and existing ones go for like $200k. i don't know if retail licenses fall under the same umbrella.

  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    I worked in a liquor store for 2 years in college, i'm thinking there isn't a liquor store because there are a few package goods bars around that sell beer, albeit with overinflated prices. My real concern is location. no schools, but there are several churches. We both have houses, he's married, i'm not. It's a relatively blue collar neighborhood, but lots of high end rehabs, andthere are several "ritzy" developments popping up as well nearby. Perhaps my next call is to a realtor!

    That's exactly what I just said. The location is probably why there isn't one.

    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • Dr. FrenchensteinDr. Frenchenstein Registered User regular
    Esh wrote: »
    I worked in a liquor store for 2 years in college, i'm thinking there isn't a liquor store because there are a few package goods bars around that sell beer, albeit with overinflated prices. My real concern is location. no schools, but there are several churches. We both have houses, he's married, i'm not. It's a relatively blue collar neighborhood, but lots of high end rehabs, andthere are several "ritzy" developments popping up as well nearby. Perhaps my next call is to a realtor!



    That's exactly what I just said. The location is probably why there isn't one.

    Esh : Dream Crusher

    So basically because nobody has opened one, i shouldn't either? sounds like brilliant advice.

  • amaluramalur Registered User
    french you referring to the the high end wine and beer store in hampden? another avenue is you can buy a building that has a license and granfather it. however the process is long and getting a new one is super hard and expensive. your gonna need to do alot of footwork.

  • Dr. FrenchensteinDr. Frenchenstein Registered User regular
    Nah, it's on Fort Avenue near a Merritt (i forget what the complex is called), i forgot another one opened right by the Harris Teeter as well. But those both seem far enough away that i wouldn't think a store in locust point would be an instant disaster.

  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    edited April 2012
    Esh wrote: »
    I worked in a liquor store for 2 years in college, i'm thinking there isn't a liquor store because there are a few package goods bars around that sell beer, albeit with overinflated prices. My real concern is location. no schools, but there are several churches. We both have houses, he's married, i'm not. It's a relatively blue collar neighborhood, but lots of high end rehabs, andthere are several "ritzy" developments popping up as well nearby. Perhaps my next call is to a realtor!



    That's exactly what I just said. The location is probably why there isn't one.

    Esh : Dream Crusher

    So basically because nobody has opened one, i shouldn't either? sounds like brilliant advice.

    No, I'm saying that there's probably good reasons. You can try, but at least if that's the reason, you'll get blocked by the community before you open and not waste too much time/money. Don't be a goose to people who are trying to help you.

    Esh on
    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • RuckusRuckus Registered User regular
    Nah, it's on Fort Avenue near a Merritt (i forget what the complex is called), i forgot another one opened right by the Harris Teeter as well. But those both seem far enough away that i wouldn't think a store in locust point would be an instant disaster.

    Problem is those ugly bastards will burrow up whenever and make a mess of shit.

    Seriously though, once you've decided on a location I'd recommend you visit the surrounding few blocks of businesses and organizations in person and talk with their managers to get feedback on your plan. Additionally, I'd coordinate with any nearby licensed restaurants and establish a good relationship with them right off the hop.

    Other than that, you're going to want to be super protective of your liquor license, basically carding 100% of your patrons. Selling alcohol to a minor, even accidentally, is a good way to bring a thriving new business to a dead stop in no time flat.

    Raneados wrote: »
    so what SPECIFICALLY is the problem with my hole?
  • GnomeTankGnomeTank Registered User regular
    Honestly, I'd card anyone that didn't have grey hair and wrinkles, but that's just me. If people get pissy about it, too bad. People do not screw around with minors and alcohol, and most enforcement agencies DO send in secret shoppers.

    Sagroth wrote: »
    Oh c'mon FyreWulff, no one's gonna pay to visit Uranus.
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  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    edited April 2012
    GnomeTank wrote: »
    Honestly, I'd card anyone that didn't have grey hair and wrinkles, but that's just me. If people get pissy about it, too bad. People do not screw around with minors and alcohol, and most enforcement agencies DO send in secret shoppers.

    Fortunately, when it's the government sending people in, the IDs are real, you just have to make sure the date makes them old enough. I can't imagine the nightmare if they sent in people with fakes and you had to decipher whether it was real or not. One that really pisses people off is that you can't take a suspended (usually indicated by a hole punch in it), expired, or temporary license.

    Esh on
    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • BurtletoyBurtletoy Registered User regular
    p sure you can take temporary liscenses.

  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    edited April 2012
    Burtletoy wrote: »
    p sure you can take temporary liscenses.

    Nope. They're too easily fakeable. If you have the temp and the original expired license together you can though. This is in Oregon though and your mileage may vary depending on where you at. But anyone who takes a flimsy piece of paper alone as ID for selling booze is someone who apparently doesn't mind the thought of losing their job.

    Esh on
    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • tech_huntertech_hunter Registered User regular
    My Aunt and Uncle plus his family bought out a guys liquor store in MD and ran it for like a few years before selling it to someone else.

    From what I understand it was very lucrative, but it was also an already established business too so that may be why. I was just a teenager when they did this was only ever in the store like once, but it seemed the biggest money maker for them was lottery ticket sales and this kino game. Apparently retailers of winning tickets get some kind of cut, and they sold a lot I guess. They got out of the business because they found the Adage "Never get into business with family" quite true.

    So this is pretty doable I think it is just going to take a lot of research like others have said, I hope you do it and become a self-made man, and job creator!

    Sig to mucho Grande!
  • fightinfilipinofightinfilipino legally competent Registered User regular
    i would say watch out for zoning restrictions AND any local neighborhood covenants prohibiting liquor stores or bars. sometimes people do not want increased traffic or other externalities (read: drunks) that unavoidably come with a liquor store or bar business.

    i would also say you should speak with a lawyer, but knowing how that's worked out for you, i can understand you being reluctant :D seriously though, you should contact a reputable lawyer for help. it'll (hopefully) save you headaches in the long run.

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  • Battle JesusBattle Jesus Registered User regular
    Write out a business plan before you do anything. This plan should include:

    The physical store: expected store location, store layout (both where storage and storefront, including which liquor goes where), expected amount of stock on hand at all times, which brands of liquor you are planning on stocking, how you want them arranged in the store

    Financial estimates: a daily, weekly, monthly and quarterly forecast of sales and sales growth for the first 5 years AT LEAST, expected volume of foot traffic through the door, expected dollar value of sales per customer, an estimate of losses due to theft (with a liquor store, that won't be insignificant), cost for leasing/buying the building, bills, the cost of stocking the store, wages/salaries, extra costs (are you going to do in-house accounting, or are you going to hire an accountant?) How much is your insurance going to be? What are your margins? Are your estimated margins enough to keep your business afloat?

    Advertising: How are you going to get people into your store, what avenues are you going to take to advertise? How will your advertisements reflect on your business, how will they affect the number of customers coming in? How much are you able to spend on advertising? What are your deals going to be?

    Staffing: How many people are you going to hire? You will need to set up detailed, specific job outlines for your staff (including yourself and your business partner, to make sure you don't step on each others toes), Are you going to offer company benefits? How much insurance are you willing to offer your staff? How much will it cost?

    Don't forget to have contingency plans for everything, as well. Things like to go wrong, and it's always a good idea to make sure you know what to do when that happens so you can keep your business running.

    This is just stuff off the top of my head. There will be significantly more to your plan than this. Your bank can likely help you develop a business plan to give you a fighting chance to be successful. Don't skip the business plan, and if it turns out that your business isn't viable, DON'T OPEN THE STORE.

    [SIGPIC][/SIGPIC]
  • DeadfallDeadfall Registered User regular
    edited April 2012
    http://www.sbdchelp.com/

    Use it. As often as possible. Most states have a small business development center that you can use for free for literally any and all advice. Start here. Work up a good relationship with one of the counselors.

    I am in the process of starting my own business and I have been working with these guys for two years to develop my plan. And it has been invaluable.

    I also took an eight week small business course at my local community college to get started, but seriously, the sbdc is pure gold.

    Deadfall on
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  • GnomeTankGnomeTank Registered User regular
    edited April 2012
    Esh wrote: »
    Burtletoy wrote: »
    p sure you can take temporary liscenses.

    Nope. They're too easily fakeable. If you have the temp and the original expired license together you can though. This is in Oregon though and your mileage may vary depending on where you at. But anyone who takes a flimsy piece of paper alone as ID for selling booze is someone who apparently doesn't mind the thought of losing their job.

    OLCC is wicked strict though. Way more strict than TABC was when I loved in Texas (and no the irony of the desperate political status quos and their respective outlooks on alcohol enforcement is not lost on me). My sister works at the Cheerful Tortoise down near PSU, and she tells me stories all the time about OLCC and their rules. They don't fuck around (and frankly I don't blame them).

    Let this be a case study in knowing your local laws really well. I would definitely research your local enforcement agency and what their reputation is. You should follow the rules anyway, but it's always nice to know what kind of enforcement climate you are walking in to.

    GnomeTank on
    Sagroth wrote: »
    Oh c'mon FyreWulff, no one's gonna pay to visit Uranus.
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  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    GnomeTank wrote: »
    Esh wrote: »
    Burtletoy wrote: »
    p sure you can take temporary liscenses.

    Nope. They're too easily fakeable. If you have the temp and the original expired license together you can though. This is in Oregon though and your mileage may vary depending on where you at. But anyone who takes a flimsy piece of paper alone as ID for selling booze is someone who apparently doesn't mind the thought of losing their job.

    OLCC is wicked strict though. Way more strict than TABC was when I loved in Texas (and no the irony of the desperate political status quos and their respective outlooks on alcohol enforcement is not lost on me). My sister works at the Cheerful Tortoise down near PSU, and she tells me stories all the time about OLCC and their rules. They don't fuck around (and frankly I don't blame them).

    Let this be a case study in knowing your local laws really well. I would definitely research your local enforcement agency and what their reputation is. You should follow the rules anyway, but it's always nice to know what kind of enforcement climate you are walking in to.

    OLCC or not, there's no way I'd ever take a piece of card stock as an ID (I'm a bartender). I've been into the Tortoise a few times. Being right on campus (I go to PSU) I can imagine the shit some people must try on them.

    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • GnomeTankGnomeTank Registered User regular
    I agree with you, I wouldn't either...was more making a point about different enforcement climates, and that it's good to know if you're going to open a liquor related business.

    Sagroth wrote: »
    Oh c'mon FyreWulff, no one's gonna pay to visit Uranus.
    Steam: Brainling, XBL / PSN: GnomeTank, NintendoID: Brainling, FF14: Zillius Rosh
  • Dr. FrenchensteinDr. Frenchenstein Registered User regular
    yeah i wouldn't take anything without a picture, that's just looking to get popped. if you're that desperate to get some booze, go play hey mister.

  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    yeah i wouldn't take anything without a picture, that's just looking to get popped. if you're that desperate to get some booze, go play hey mister.

    Oh, they have pictures. It's just that it's all printed on a piece of card stock.

    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • bowenbowen Registered User regular
    Seems like they could eliminate the problem with a state ID lookup with a barcode or something. I guess that's not as fun as putting liquor stores and bars out of business though.

  • EshEsh Sunshine! Kittens! Rainbows! Smiles! Portland, ORRegistered User regular
    bowen wrote: »
    Seems like they could eliminate the problem with a state ID lookup with a barcode or something. I guess that's not as fun as putting liquor stores and bars out of business though.

    Barcodes can be photocopied. That and the equipment to install in every bar/restaurant/store would be prohibitively expensive.

    "At first he thought it might be a natural occurrence - maybe a rabbit. But upon closer inspection, it was clear a knife had been used. And rabbits don't carry knives."
  • FiggyFiggy Registered User regular
    edited April 2012
    I'm sure there is an official list of acceptable identification. It's not a matter of a store accidentally accepting the wrong piece of ID out of a possible thirty. Here, there is a very specific set of IDs you're allowed to accept. And if someone comes with a passable fake (or their older sister's), you're not going to go out of business for accepting it. But if you accept something completely off-the-wall or don't even ask, you're in trouble.

    Regulations aren't there to punish or trick the license holders. They're there to deter underage drinking. Just ask for ID and only accept the approved forms, and you'll be fine. I think, in general, IDs are getting harder and harder to fake well. We used to just paint a little number over the date on our IDs when I was in high school, and that worked every time. Now, there's so many security features it's insane.

    EDL.jpg

    -Birthdate is worked into two places on the ID and also into the actual DL#.
    -Birthday and picture is part of a hologram on the bottom right.
    -Entire card is overlaid in a holographic design so scratching shows easily
    etc.etc.

    Figgy on
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