Colorado’s stunning landscapes and booming economy are two of the many reasons to open up your new business in the state.
Successfully opening a liquor store in Colorado is a six-step process. Your business deserves an incredible grand opening and a heavy stream of customers to follow. If you skip a step on this checklist, you’re likely to end up spending time and money later on to fix the initial steps you missed early on.
When researching how to open a liquor store in Colorado, it’s crucial to get all the essential information you need before making any permanent decisions. Let’s review all the steps you need to know to understand how to open a liquor store in Colorado and get you up and running.
How To Open A Liquor Store in Colorado in 6 Steps
To start, if you’re considering opening your liquor store in Colorado, there are tons of resources at your disposal.
Additionally, Colorado is the home of the biggest startup event in the country, with many small business loans available. Colorado has approved over $825 million worth of loans in one year alone. Despite Colorado being one of the best places to start your business, several essential factors affect the opening and longevity of your new liquor store.
1. Determine Your Liquor Store Type
There are many different types of liquor stores that need various liquor licenses to get up and running. The first determinant is whether or not your liquor store will sell liquor and have an available bar for on-site consumption. For example, you may have a liquor store that primarily sells beer, and you may have a pub inside your place of business.
There are 37 various types of liquor licenses and permits in Colorado, so in order to choose which one applies to your business, you’ll need to start with determining which category fits your business the best.
Some examples of the different types of liquor license-qualified businesses include:
- Beer & Wine Stores
- Distillery Pubs
- Special Event Companies
- Art Galleries
By this point in your journey to opening up your liquor store, you should already have an established business plan and funding, so you can accurately choose which business registrations, liquor licenses, and operation permits apply to your business.
2. Registration, Permits & Licenses
Once you’ve determined which applications you qualify for based on your business type, you must apply for those registrations, permits, and licenses. This application process should take place before you’ve chosen your real estate location due to zoning restrictions.
Out of the 37 types of liquor licenses and permits, there are:
- Retail licenses
- Local and state-issued permits
- State licenses
- State only issued permits
The costs of the licenses and permits range from $0 to $1,650, not including your business registration. For your business registration, it’s required that you register for your Employer Identification Number (EIN) on a federal level. Your business registration may need to be done on a local and state level, depending on the requirements of the area of Colorado you’re operating your business in.
3. Temporary Fee Exemptions
During the COVID-19 pandemic, there were fees waived by Colorado State relating to liquor licenses. You may qualify for this temporary fee exemption depending on the type of liquor license you apply for and when you apply.
This temporary fee exemption is from Colorado’s Senate Bill 20B-001, and it waives the fees for new applications, renewals, late renewals, reissuance renewals, and COVID-19 temporary modifications for specific liquor licenses. The current application date range is from December 7, 2020, to December 7, 2021, but if you’re applying after that date range, be sure to check back on Colorado’s Specialized Business Group to see if there is an extension.
The only exceptions to this temporary fee waiver are the liquor licenses that don’t qualify and concurrent review fees of $100 that need to be paid directly to the state.
4. Pricing & Building Inventory
Purchasing the right amount of inventory and pricing your inventory correctly are two crucial factors affecting your initial revenue and profitability.
If you purchase too much inventory upfront, you may run into a cash flow problem. Meanwhile, if you don’t buy enough inventory and you have a huge grand opening, you may run out of inventory that customers came for. Estimating how big your grand opening will be and the market standard pricing will help you determine how much inventory you need, at what price point.
Before your grand opening, it’s essential also to have your inventory management software set up, so you’re able to track and manage what you have in stock before the big day. When looking for an inventory management system, it’s crucial to obtain one that integrates seamlessly with your point of sale (POS) system like POS Nation.
5. Marketing Plan
Without a marketing plan, your liquor store will be managing promotions and online presence with no long-term strategy and plan.
The role of a marketing plan is to budget and organize your priorities before opening day and throughout the course of your business. You can plan out what your target demographic is, which promotions you would like to run, and how to get your message out to that target demographic. Your marketing plan should not be skimped over because if it’s built right for your business, it can bring tremendous growth and keep customers coming back.
6. Plan Grand Opening & Promotions
Especially in the liquor store industry, promotions and specials drive customers to choose your store over another. Managing your promotions is an essential part of seeing the success of your promotions and knowing which promotions to repeat.
For your grand opening, it’s essential to run a promotion or a special that brings customers through the door and urges them to return. When planning your grand opening promotions, consider a campaign that gives a reward or a discount when customers return. This will help drive customer loyalty up and sustain your business beyond your grand opening.
Don’t Miss This Final Step
Successfully opening up a liquor store in Colorado is just the beginning. Once the grand opening has finished, there are many other responsibilities and tasks to complete.
Before your grand opening, choosing a reliable, trustworthy POS system provider ensures your payments are accurately processed, your inventory is maintained, and that you have data to analyze your promotions and sales. Your POS system should be intertwined with your inventory management system.
Now that we’ve covered how to open a liquor store in Colorado, we recommend starting with our Guide to Liquor Store Inventory Management as your next step. This guide ensures that your liquor store will be able to manage and maintain the inventory you need to bring in your customers.