How to Open a Liquor Store

Opening a liquor store can be challenging, but ultimately a very profitable venture. It means you're joining over 45,000 other entrepreneurs in the wine & spirits retail industry that is valued at over $80B.

85% of these liquor stores are independently owned, which makes the liquor industry one of the most local retail sectors in the US, leaving plenty of room for independent retailers to try their hand at building a profitable business.

Is It Profitable to Open a Liquor Store?

Liquor stores are one of the most stable businesses in retail. They rarely go out of business, they’re durable during recessions, and they have strong profit margins (20-30%).

This encourages many people to try running a liquor store. Industry research estimates that about +747 net new stores have been opened in 2024.

However, opening a liquor store is also a highly regulated and capital-intensive endeavor. Liquor stores are among the most difficult businesses to start and operate, due to strict laws and the need for significant upfront investment.

It's widely believed that a new, well-run store can generate a profit within 18 months, but this is easier said than done.

Some decisions may seem small, but even with healthy margins, alcohol retail requires extreme attention to detail. If you make ordering mistakes, misprice products, or allow your employees to offer too many discounts, those profits can shrink much faster than you expect.

This guide is designed to direct your attention to the most important fundamentals of opening a liquor store, as well as show you the hidden details that can make or break your business.

Step 1: Business Planning and Market Research

You don’t need a 50-page market study, but you do need to know if your city or town can realistically support one more liquor store.

Walk and drive through the area, count the existing stores, get a sense for the accessibility of their location, and observe who shops at these liquor stores. You want to gauge the potential customers you could invite to your store and where you can differentiate your shop vs. the existing stores in the market.

Typical liquor-store ICPs include:

• Local “everyday” neighborhood shoppers
  
  
• Higher-income professionals and corporate buyers (gifting, premium bottles)
  
  
• College students and young adults chasing deals and RTDs
  
  
• Lower-income, price-sensitive regulars focused on the cheapest options

Your goal here is to confirm there’s room for one more store and decide which of these groups you’re actually building for.

Step 2: Understand The Industry

Alcohol is not regulated at the federal level. It’s regulated by each state, and often further shaped by county or city rules. That essentially means the business model that works in one state might be illegal or unprofitable in another.

For example, corporate chains only control a minority of the liquor store market today, and the real competition for liquor retail often turns out to be grocery stores. In many states, they can sell beer and wine, and in some, they can sell spirits too. 

That means your future customers already have plenty of places to buy alcohol. 

But in states like New York and New Jersey, grocery stores can’t sell wine or spirits, so liquor stores are the only legal option for those categories.

On top of that, many states have complex tax structures. You may have to charge different taxes based on product type (e.g., spirits vs. beer) or volume sold. For example:

• Maryland charges consumers a 9% sales tax on all spirits products
  
  
• Washington state adds a $3.7708 per liter tax on spirits sold
  
  
• Massachusetts adds a $0.05 deposit per can or bottle of carbonated beverages (beer, canned cocktails, etc.)
  
  
• Colorado requires destination-based tax on deliveries, so you charge county and city taxes based on the delivery address, not your store’s address

Once you understand the complexities of the liquor industry, it's also important to understand the unique strengths of your position as a liquor store owner.

The good news is that many consumers still prefer dedicated liquor stores because:

• Locations are usually more convenient, so they can get in and out faster
  
  
• The selection is wider and more specialized
  
  
• Staff tend to be more knowledgeable
  
  
• They like supporting local businesses that feel like part of the neighborhood

That means you need to compete with corporate chains and grocery stores on the basis of convenience, selection, expertise, and community presence.

Step 3: Navigating the Paperwork and Licenses

We already explained that alcohol retail regulation varies by state, and that also means the procedure for opening a liquor store differs as well. Still, there are a few bureaucratic steps that everyone must go through.

Before you apply for a liquor license, you need to establish a legal entity. This means:

• Forming an LLC or corporation (because of liability and licensing)
• Choosing and registering your store name
• Getting an EIN from the IRS 
• Securing any local business licenses required by your city or county

This is what makes your store “real” in the eyes of the law, allowing you to hold licenses and sign leases in the business’s name.

Once that’s in place, the liquor license becomes the primary bureaucratic hurdle. Without a license, you can't even start ordering products from distributors.

It can take several months for the application to be reviewed, even when all the required information is provided correctly, but some states offer temporary permits that let you open sooner.

Each state has its own Alcoholic Beverage Control agency (or equivalent), and you’ll typically apply for an off-premises license. That means you’re allowed to sell sealed containers (such as bottles, cans, or boxed wine) that customers can take away and drink elsewhere.

In some states, especially quota states like New Jersey, licenses are limited based on population. That means there may be no new licenses available, and your only option is to buy an existing license from a current holder, which sometimes can cost more than your entire starting inventory.

Additionally, zoning rules can completely block otherwise ideal locations. Many areas forbid liquor stores within a certain distance of schools, churches, or libraries, and some towns or counties are partially or fully “dry” or have moratoriums on issuing new licenses.

The process of obtaining a license is slow and unforgiving. It includes background checks, fingerprinting, and detailed questions about applicants' finances and ownership structure (people with certain felony or misdemeanor convictions are often disqualified).

Approval is never guaranteed, and the primary cause of delays or denials is often due to incomplete, inconsistent, or incorrect forms. That’s why many store owners hire a lawyer or licensing consultant to guide them through the process.

You should aim to start your licensing process at least six months before your planned opening date, so you’re not paying rent on a store you’re legally not allowed to operate.

Step 4: Financing and Budgeting

Opening a liquor store isn't cheap, and underestimating costs is one of the fastest ways to fail. 

Startup costs are estimated to be in the range of $100,000 to $300,000, depending on the state, license price, store size, and build-out:

• Liquor license fees: From a few hundred or thousand dollars in some states to hundreds of thousands in quota states where licenses are scarce.
  
  
• Initial inventory: Often $30,000 to $250,000 or more to get a solid mix of spirits, wine, beer, and RTDs on the shelves.
  
  
• Store build-out: Shelving, refrigeration, counters, basic decor, security systems, and signage, which can easily run into tens of thousands of dollars.
  
  
• Hardware and tech: POS system with inventory tracking, barcode scanners, receipt printers, and back-office equipment.
  
  
• Working capital: Several months of rent, utilities, payroll, insurance, and other recurring expenses.

Banks are often cautious with liquor store startups, so you usually need a strong credit rating and a clear business plan. Whatever total you calculate, add a cushion, because costs almost always end up higher than expected.

Step 6: Inventory Management and Supplier Relationships

You can't just walk into a warehouse and buy whatever you want. The alcohol industry works through a three-tier system: manufacturers sell to distributors, and distributors sell to retailers.

Most of your long-term profit or loss comes from how you buy, receive, and understand your inventory. Before you open, you need at least a basic grasp of how this works, so you know where the money is actually made.

1. Ordering‍

Liquor stores place wholesale orders almost every day, often from 20 or more distributors across various categories, including wine, spirits, beer, cannabis products, canned cocktails, mixers, tobacco, and more. Profits are made in the ordering process. If you order based on intuition instead of data, trends, seasonality, and budget, you either run out of winners or fill your shelves with slow movers that trap your cash.

2. Inventory receiving‍

Liquor stores receive wholesale deliveries every day for dozens of products that have to be logged, checked, and priced. For many owners, this involves five or more hours of manual work every day, including checking invoices, correcting pricing errors, and entering new products into their system. If you make mistakes when receiving products or ignore the need to update your pricing when costs change, your margins will make it difficult to turn a profit

3. Product details‍

There are hundreds of different types of wines, spirits, and beers. If you only see them as “beer” or “red wine,” you miss all the nuance in your sales. For wine, you care about grape variety, region, and producer. For spirits, you care about type, origin, alcohol content, and bottle size. Mapping all these details to thousands of products can be exhausting, but the closer you get, the better you understand what actually generates revenue.

4. Supplier Relationship‍

Building strong relationships with your distributors is just as important as managing your inventory. In most states, you can’t choose any supplier you want for any product because each brand is carried by a specific distributor, and prices are often set by law or by state-posted price books. That means it isn't always optimal to go about hunting for the lowest price. Sometimes, you need to work with representatives who provide early notice on deals, limited releases, new items, and quantity discounts that can increase your profits.

The point of this step is to understand that profits in this business come from smart ordering, disciplined receiving, and a clear picture of what really sells in your neighborhood.

Step 7: Set Up a Liquor-Specific POS System

Opening a liquor store can be much easier if everything is streamlined, clean, and organized, and a modern liquor-specific POS system can help you with that. 

Instead of juggling paperwork, spreadsheets, and guesswork, you run the store from one reliable source of truth. That makes it easier to start, train staff, and maintain control as you grow.

The best liquor store POS systems can help you turn daily chaos into a simple, repeatable flow:

• Help you with orders and invoices, turning a once tedious manual task into a five-minute chore
  
  
• Ensure that every SKU is named, priced, and paired with the right photo, so that it’s easy for your customers to find the product that they want in-store and on your website
  
  
• Prevent inventory errors, eliminate double entry, and keep a single source of truth across the register, your website, delivery apps, and wholesale
  
  
• Help you grow sales with customer profiles, loyalty programs, and detailed sales reporting
  
  
• Grow ecommerce sales by using SEO so shoppers find you when they search online
  
  
• Integrate with delivery apps, platforms and marketplaces like Wine-Searcher so that your catalog is visible to your customers wherever they prefer to shop
  
  
• Handle complex products, such as beer sold in singles, packs, and cases, or wines with the same label across different vintages, without compromising inventory or pricing accuracy

Modern liquor-store POS systems exist to remove most of the boring, error-prone work that used to drag owners down. When this is set up properly from day one, you can spend your time on growing the business and providing the best customer service.

Step 8: Design Your Store Layout for Sales and Security

How you arrange your store directly affects what customers buy and how much you lose to theft. You do not need a designer, but you do need a layout that makes shopping easy and keeps you in control of the floor.

Key principles to follow:

• Place popular items at the back so customers pass by more products on their way
  
  
• Keep small, high-value bottles near the counter or in locked cases
  
  
• Ensure you can see most of the store from the register and avoid any blind spots
  
  
• Keep aisles wide enough for people and carts to move comfortably
  
  
• Group products in a way that is intuitive to the customer, with cold beer and chilled wine in the cooler and wines organized by country or region

If your layout feels simple, logical, and easy to watch over, you are already doing it right.

Step 9: Launch Your Store Online

Taking your liquor store online isn't mandatory, but it's becoming increasingly expected. 

eCommerce now represents more than 4.3% of total beverage alcohol sales in the US, reaching $977 million in 2023. More importantly, 58% of consumers reported using a third-party app to order alcohol in 2024, and 40% reported ordering delivery more in 2024 than in 2023. 

Omnichannel presence is becoming increasingly important in the liquor industry, and it requires stores to connect all their sales channels (in-store, online ordering, delivery apps, and curbside pickup) so they work together seamlessly. 

Digital platforms also play a significant role in driving offline sales, as an increasing number of consumers rely on online research to inform their in-store purchases. Even customers who buy in person are often checking your inventory online first.

• Basic website: At minimum, have a site with accurate hours, location, and contact info. People often discover local businesses online first.
• Partner with delivery platforms: Services like Uber Eats, Instacart, or DoorDash handle the technology, delivery logistics, and age verification while you fulfill orders. This is the easiest entry point.

With the right liquor-specific POS, you can connect every sales channel, including the storefront, website, delivery apps, and curbside, so orders flow through one system with unified pricing, promotions, and customer data.

Real-time syncing keeps inventory accurate, regardless of where the sale occurs, prevents overselling, automatically adjusts stock levels, and maintains accurate pricing for each channel.

Launch Your Liquor Store with the Right Technology Partner

Opening a liquor store is complicated enough without wrestling with outdated systems that waste your time and cost you money. If you're tired of juggling five different platforms just to run your business, Santé POS is built for you.

Santé consolidates everything (POS, website, delivery apps, marketing, and AI for back-office) into one, industry-specific platform. 

Our AI invoice scanning turns annoying receiving work into just a couple of minutes, and real-time inventory sync across all channels (DoorDash, Uber Eats, Instacart) prevents angry customer calls when you oversell.

With our marketing platform, you can leverage our AI to send email and text message campaigns to your customers based on their purchase history. When you bring in new products, restock popular products, or have an exciting new tasting event on the calendar, Santé will engage with your customers to drive both in-store and online sales.

Try Santé POS in action and judge it by what your next month of operations looks like

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