Is buying a liquor store the same as getting a license to print your own money as some believe, a passport to the lifestyle you’ve dreamed of? Certainly a liquor store for sale can be seemingly attractive, but you have to really focus on how you run it to get there. Remember there is a lot of regulation in this industry and operating costs are on the higher side as well. If you have a lot of competition around you, you may not have much room to play, so you will need to focus all your efforts to be successful.
It is important to really understand the motivating force behind the seller’s desire to move on. Is there a hidden reason that could make it just as difficult for you to “get ahead” in this business? Study the books very well to calculate your margins and investigate any anomalies carefully.
State authorities regulate liquor stores very carefully, and in many cases you will have to qualify personally to move forward. You should verify your own eligibility before trying too hard to find suitable candidates. Check with state and local jurisdictions to see what stipulations may be placed on the business in the future. In some areas you cannot transfer an existing license or obtain a new one to operate the business, so do your homework.
Don’t overlook the amount of effort that you will have to put into this type of business to make it work. Take a good look at the outbound salesperson methodology, and if you’ve been successful, be sure to replicate it after you take over.
There is often great potential when you choose to buy a business like this, but you need to pay close attention to managing day-to-day operations. This is even more applicable when it comes to stocks. Please note that you cannot simply reorder individual bottles and most of the time case orders are required. Since you can generally receive deep discounts if you buy boxes in volume, you should keep these discounts in mind when considering your local competition and choosing your prices.
Don’t underestimate the monthly costs, especially the cost of your utilities. Cold storage can be expensive to operate, and your insurance premiums can be higher when you buy liquor store business assets, compared to other retail businesses. Remember that most customers will choose to use credit or debit cards to pay and those fees can reduce margins.
But there is an additional opportunity if you think carefully about the type of business you are considering. People generally buy wine, beer, or liquor when they’re in the mood to celebrate. They may be celebrating a birthday, preparing for a wedding reception, entertaining friends, etc. This gives you, as a new owner, many opportunities to build good relationships with your customers, as they see your property as a place they visit during the “good times.” Interact with them as much as you can, remember their names, and get involved.
This type of activity will give you a lot of comments, since they choose to choose your establishment exclusively and also recommend it to their friends. Remember that this type of business lends itself to much more customer interaction than a typical convenience store, for example.
