How To Legally Sell Alcohol: 5 Things You Need To Know

Thinking about opening a liquor store (or already managing one)? Then you’ve probably realized that knowing how to legally sell alcohol is much more complicated than it seems.

Alcohol regulations are anything but straightforward — they vary widely depending on your location in the United States. Overlooking them isn’t an option either, unless you’re okay with hefty fines or worse: getting your store shut down.

But just like mixing the perfect cocktail, it’s much easier if you have some guidance instead of guessing your way through! In this guide, we’ll cover five practical tips on how to sell alcohol legally, avoid common compliance pitfalls, and use specialized liquor store point of sale (POS) software to make staying compliant easy.

1. Get Familiar With Federal, State, and Local Regulations

Alcohol laws vary widely from state to state and even city to city, so it's no wonder if you're feeling confused. On the federal level, you’ll look to the Alcohol and Tobacco Tax and Trade Bureau (TTB) for things like licensing, permitted labels, and paying liquor taxes. 

At the state level, each has its own set of alcohol laws — often differing from one another. You may operate in an “open” state with straightforward liquor laws, or you might be in a “control” state where all alcohol sales funnel directly through state-owned stores (think Alabama or Pennsylvania). Certain states also have specific individual laws, like Massachusetts’s ban on alcohol sales during open polls on election days or Nevada’s famously lenient sales hours. 

So what are the next steps to figure this all out?

1. Start local: Check your city’s website, zoning area, or chamber of commerce — they often provide simple breakdowns specific to your area.
2. Check your state’s alcohol control board: Every state has one (e.g., the New York State Liquor Authority or Texas Alcoholic Beverage Commission). These sites typically provide detailed guidance about local licensing processes and regulations.
3. Review federal resources: The TTB's website clearly explains licensing, labeling, and tax requirements, and offers the Permits Online tool for applying for your federal license.

Once you work through these steps, you’ll likely have a better grasp of the specific rules for your business. But juggling all these regulations while managing daily operations can add unnecessary stress — that’s where a specialized point of sale (POS) system comes into play.

Liquor-store focused POS software can automate tasks like verifying customer IDs at checkout, preventing sales during restricted hours, and accurately tracking compliance details, helping you avoid expensive mistakes without extra hassle.

2. Obtain Proper Licenses (And Keep Them Updated)

Liquor licensing might not be the most exciting part of running your business, but it’s one you can’t afford to overlook. Every retail alcohol business needs to secure the proper licenses (and stay on top of renewals) to legally sell alcohol.

License requirements differ based on how your store operates: 

• Off-premise licenses are necessary if you sell bottles for customers to enjoy at home (liquor stores, convenience stores, grocery stores).
• On-premise licenses allow your business to serve alcohol for customers to consume on-site (bars, restaurants, clubs).
• Specialized permits are available for brewpubs, taverns, beer-and-wine-only shops, or alcohol delivery.

Additionally, special occasions, deliveries, and certain unique selling situations might require separate permits or certifications before you can offer these options to customers.

It’s probably no surprise that the costs and waiting times for these licenses vary based on your business location, but the average price for a liquor license in the U.S. ranges from $1,500 to $3,000. In quota states, where local population determines license availability, securing a license often takes longer, costs more, and involves greater competition.

Related Read: Getting a Liquor License: 7 Common Mistakes to Avoid

Keeping licenses updated is crucial, and Bottle POS can make gathering the right info easier when you need it. With advanced reporting, real-time dashboards, and detailed sales analytics, Bottle POS provides quick access to accurate inventory and sales data, helping simplify periodic license renewals and audits.

3. Keep Accurate Records & Manage Inventory Properly

Liquor store retailers need to maintain clear documentation of invoices, receipts, product sources, and purchase data — especially for large transactions. Regulators can inspect these records anytime, and mistakes or omissions carry steep fines. 

A liquor store POS system like Bottle POS can make these tasks easier with features like: 

• Auto invoicing to eliminate manual inventory entry
• Auto ranking products based on sales, quickly showing bestsellers
• A centralized SKU database to keep product listings standardized
• Shrinkage prevention tools, including employee transaction monitoring and security integrations, to reduce theft and loss

Bottle POS takes the hassle out of inventory recordkeeping, preventing slip-ups that could cost you in fines or lost product.

4. Train Employees on Compliance & Responsible Selling

Even if you have all your licenses and inventory records in order, compliance often comes down to the front-line employees who interact with your customers every day. All employees selling alcohol need to clearly understand (and follow) the rules around responsible sales.

When training your employees, make sure everyone knows how to:

• Properly check and verify customer IDs (21 is the federal minimum, except in Puerto Rico and the U.S. Virgin Islands where it's 18).
• If you host events or tastings, recognize when a customer has had too much to drink — under dram shop laws, law enforcement can hold your store liable if an intoxicated customer causes harm or damage after leaving your establishment.
• Follow state-specific restrictions, like prohibited Sunday sales or restricted operating hours.

Your POS system can help employees sell responsibly by providing clear transaction records and employee monitoring tools, helping reduce mistakes during alcohol sales.

5. Follow Alcohol Storage & Handling Rules

Once you have your store set up and your team fully trained, make sure you follow proper alcohol storage and handling regulations. Alcohol products need careful handling — bottles and packages must always be appropriately sealed, stored securely, and protected from breakage or loss.

To stay compliant, you should:

• Regularly inspect product seals and packaging to confirm nothing has been tampered with or damaged.
• Store your alcohol products securely, preventing unauthorized access, theft, or spoilage.
• Train your staff on best practices for careful product handling to minimize broken bottles or spoiled inventory.

With Bottle POS' shrinkage prevention tools, including employee transaction monitoring and integrated security cameras, you can quickly catch unusual activity or inventory issues before they become expensive problems.

Related Read: REVEALED: The 4 Most Important Liquor POS Security Features

Take the Stress Out of Staying Compliant

Selling alcohol legally means tracking a lot of moving parts. Beyond licenses and everyday sales rules, you should also be aware of often-overlooked details, like proper sealing on bottles, never refilling or altering containers, and following unique promotional or product restrictions.

Bottle POS makes inventory management, invoicing, and loss prevention less tedious — no more digging through piles of paperwork or tracking down inventory mistakes on your own. Schedule a Bottle POS demo today to see how it can keep your liquor store compliant.