So, you’re interested in starting a liquor store? Great! Before you start ringing in sales, know that the liquor industry is one of the most highly regulated industries in the world. In fact, the U.S. government places complex mandates on what constitutes a liquor store and what can be sold within a liquor store. These laws and regulations are enough to make even the most seasoned business owner toss up their arms in frustration!
To make matters even more complex, securing a liquor license is one of the most challenging, costly, and time-consuming tasks that business owners must quickly and efficiently hurdle on the path toward small business success.
It’s easy to get blindsided by the total cost of a liquor license. This begs the question – is there an easy way to estimate the total cost of a liquor license before applying? It’s a difficult question to answer. There are several factors to consider when pricing out the total cost of a liquor license.
To help you avoid unnecessary expenditures on the liquor license application (and renewal), we’ve created a quick-start guide that addresses the three most significant factors to consider when applying for a new liquor license for your growing business.
How Much is a Liquor License? 3 Top Factors
While licensing costs in some areas and states can be relatively inexpensive, you could be looking at hundreds of thousands of dollars in fees in other places like metropolitan neighborhoods.
The only way to get an accurate number for how much a liquor license will cost you is by talking to your local bars and liquor sales businesses and your local government liquor licensing office.
However, in our quick guide below, we’ll break down for you all the cost variables associated with obtaining a liquor license, so that steep numbers don’t blindside you before you start the liquor license application process.
The Cost of a Liquor License
Your first steps will be understanding the different types of liquor licenses and determining which type of liquor license your business will need. Next, study the exact alcohol laws regarding liquor licenses based on your specific location, as they vary from state to state.
Each state has its own Alcohol Beverage Control (ABC) board – the agency is in charge of regulating the sale of alcohol. Contact your state’s ABC to understand your state’s liquor laws. They will help you find out which type of license you need, how much it will cost and walk you through the process of how to get a liquor license in your state.
According to the latest liquor license costs by state report by Ballotpedia, “the cost of liquor license fees levied by states ranged from $100 (in Idaho) to $13,800 (in California).” On average, obtaining a liquor license in the US will cost your business around $1,400 in total. (This does not include other fees, permits, or expenses associated with being able to sell alcohol from your business; just the license.)
Once your liquor license application is approved, expect to pay as little as $100 or as much as $15,000 in fees, depending on your location and type of business.
For your liquor business to remain in good standing with the government, you will pay a renewal fee, which can cost anywhere up to the cost of the permit itself (average $1,400). However, the liquor license renewal process is generally more straightforward and less expensive than the initial application process.
As long as you haven’t sold to minors or gained a derogatory business reputation in your area, you should be able to get a liquor license renewal up to 90 days before or after it expires ( depending on your state).
Your liquor license renewal cost can be almost $1,000 less than the original cost, but don’t count on it. Budget for the full amount, just in case. This will need to be paid every 1-3 years, depending on your state.
Sometimes local agencies provide reduced renewal fees for remaining in good standing with them throughout the year. Some states have even waived retail business licensing fees for those most impacted by the COVID-19 pandemic.
Late Fees and Penalties
Don’t let your licensing slip; otherwise, you will also have to pay penalty fees if you are late to renew and could be subject to other surcharges. Penalty fees and surcharges can fall in the range of $100 to thousands of dollars, again, depending on license and area. Keep meticulous records and plan ahead for license renewals to avoid these extra costs and fees.
Don’t confuse your license expiration date with the deadline window for you to renew your license. Late fees can even be imposed beginning 60 days before your license expires, so plan accordingly and get that renewal in as soon as possible.
Weighing the Cost of Your Business Software Tools
If you’re reading this article, you’re probably a savvy, proactive business owner who values weighing your options before investing. You are our kind of business owner!
We value the merits of considering all options before deciding. It’s a critical skill for business owners to develop and one we pride ourselves on here at POS Nation. However, while you are considering the variables that contribute to the cost of a liquor license, make sure you’re factoring in other business costs as well.
Our biggest question is, how well is your current point-of-sale (POS) software system serving your business? To help you decide on a POS system that will work for you and your liquor business, check out our buyers' guide that breaks it all down for you.
Did you know that POS Nation specializes in POS systems tailor-made for liquor business owners? We offer an impressively featured and integrated POS system with a full range of capabilities.
POS Nation universally ranks at the top for quality liquor store POS software systems. “Overall, POS Nation proved to be the best POS system for liquor stores...POS Nation scored a 4.5 out of 5,” according to industry experts. Take a look at our all-in-one retail point of sale software system for more information.