Owning a small business can be a dream come true. You’ll have the opportunity to build lasting relationships with your customers, share your passion for fine spirits, and make big sales.
But before you plan your grand opening, there are some essential steps to take to set your liquor store up for success.
In this guide, we’ll walk through how to start a liquor business — and ensure that you’re on a path to profitability.
1. Do Your Research
The first few steps on your journey to becoming a liquor store owner are the most important. During the beginning phases of your planning, you’ll need to do thorough research, set specific goals, and determine exactly what niche you want your liquor store to fill.
Choose a Niche and Identify Your Target Market
Your liquor business should have a clear purpose that makes it stand out. For example, your store might specialize in high-end spirits that customers can’t find anywhere else, or perhaps your selling point will be that you carry the widest variety of liquors at the lowest prices.
No matter what niche you choose to fill, it should meet your target market’s needs. To identify your target market, take a look at the area in which you’re planning to start your liquor business. What are the drinking preferences of your potential customers? How much are they willing to spend on liquor? How can you make sure your business appeals to them?
By choosing a unique niche that meshes with the wants and needs of your target market, you’re setting your liquor business up for success.
Size Up the Liquor Store Competition
Understanding the competition is another critical part of the research process. As you’re developing a business plan, visit other local liquor stores in the area and think critically about their business models, product ranges, and shopping experiences.
You might notice gaps or oversaturation in the market. For example, there may be several stores carrying craft beers concentrated in one area, but there may be very few stores that carry wine and liquor.
Knowing where your competitors are and what they offer will help you set your liquor business apart.
2. Understand Liquor Laws and Regulations
Before you dive into the liquor industry, it’s essential to understand the laws and regulations surrounding alcohol sales. These laws vary, with some states and municipalities requiring liquor licenses, so it’s vital to thoroughly research your area’s specific legal requirements to ensure compliance.
Federal law prohibits the sale of alcoholic beverages to customers under the age of 21, which means that you’ll need a solid process in place to verify shoppers’ ages and protect your business from hefty fines and penalties. Your best bet is to use a point of sale (POS) system designed specifically for liquor businesses that includes a built-in age verification feature. This tool prompts cashiers to manually enter customers’ birth dates or scan their ID cards to ensure that all sales are legal.
Knowing and following all laws and regulations regarding alcohol sales is foundational to the long-term success of your liquor store, so make sure that this is a part of your business planning process.
3. Create a Financial Plan
Investing in a small business is a major undertaking, so financial planning is a critical stepping stone on your journey to launching your liquor store.
The two main parts of a financial plan are calculating your costs and projecting your sales.
First, you’ll need to estimate how much money it will take to get your business off the ground — as well as the ongoing costs of staying in business. Let’s review some of the most common costs associated with opening a liquor store:
- License and permit fees for your liquor and business licenses
- Location costs, such as the lease or purchase price of your store
- Store set up and renovation to turn your location into an enticing shopping environment
- Technology like your business’ POS system
- Utilities such as electricity, internet, and water to keep your store operational
- Labor costs for your store’s employees
- Inventory to stock your liquor store’s shelves
This isn’t a comprehensive list, and costs for these items will vary depending on your location, but you should have a solid idea of how much it will cost to get your liquor store running.
Next, you’ll need to project your income. This involves estimating how many sales you’ll be likely to make and what the average value of those sales will be. These calculations are crucial for predicting when you’ll start to make a profit after starting your liquor business.
4. Choose a Location
The right location is critical for getting customers through the door. Along with budget, here are some factors to consider as you hunt for the perfect spot for your liquor business:
- Traffic and Accessibility: How easy will it be for your customers to find the location? How much foot traffic does it get? How convenient is parking?
- Demographics: Does the location align with your target market? Will your liquor store’s niche and offerings match the wants and needs of the people living in the neighborhood?
- Proximity to Competitors: Are there nearby liquor stores that you’ll have to compete with? How far away are they, and are your offerings different enough to set you apart?
By keeping these aspects in mind, you’ll be better positioned to attract customers and grow your business.
5. Set Your Liquor Business Up for Success With the Right Tools
Once you’ve finished your financial plan and selected your location, it’s time to equip your liquor business with a powerful POS solution.
A POS system is the engine that keeps your liquor store running. Not only does it process all of your sales — but it also manages your inventory, analyzes your business’ performance, and helps you grow your loyal customer base.
Let’s explore a few key ways to use your liquor business POS system:
- Streamlined Checkout: Create a convenient experience for your customers through built-in age verification and support for multiple payment types.
- Effective Inventory Management: Keep your shelves perfectly stocked with features like real-time inventory monitoring, automated purchase orders, and case breaking.
- Detailed Reporting: Monitor the financial health of your business with insightful sales reports.
- Customer Loyalty: Build your loyal customer base and boost your sales with a customizable loyalty program.
- Marketing: Keep your customers in the loop about your upcoming promotions through SMS messaging and email marketing integrations.
Choosing the right POS system has a major impact on the success of your liquor store, providing you with all the tools you need to build a thriving business.
Launch Your Liquor Business With Bottle POS
If you’re looking for the best support team to stick by your side as you learn how to start a liquor business, we’re here to help.
Bottle POS is a point of sale solution designed with the needs of small liquor store owners like you in mind. Our POS software is equipped with robust inventory management, customer loyalty, reporting, and marketing capabilities, and our team is here to help you put these tools to work as you build a booming liquor business.
Schedule a live, personalized demo today to learn more about Bottle POS.
