What started out as a man cave shared with a few friends has now blossomed into a strong desire to open a unique bar or saloon. Your friends seem to validate this desire by encouraging you to take your retirement money and invest in a business that will be a “sure thing.” You’ve talked with your wife, your best friends, your banker and lawyer and it seems that your thoughts about opening a new type of bar has more merit than you originally thought. But what should you do first and what are the successive steps to make this a successful venture?
Even though beer, wine and liquor licenses vary by state, there are some generally common licenses from state to state. For instance, tavern licenses can be obtained if the business receives less than half of its income from the sale of alcoholic beverages. You may not even have to serve food under some state laws. If you obtain a beer and wine license, you sell virtually anything that doesn’t exceed 20% alcohol content.
If you have a mind to establish a restaurant, you can sell any type of alcoholic drink provided that the sale of such beverages doesn’t exceed a certain amount of the business revenue. Generally, that figure is about 40%. Private clubs such as golf clubs and country clubs allow you to obtain a license to sell alcohol but often there are restrictions as to type and quantity that need to be observed.
It is generally understood that you need to obtain a business license from the town or city you wish to establish your business. If the location you seek to build the business is outside the town or city limits, you will need to contact that county to obtain such a license. Then there is the matter of building or renovating. It will be necessary to check with the town or county’s zoning and code enforcement officer as to what your limitations may be. If you plan to serve food at your bar, you will want to understand how much and what type of alcohol may be served. But the best thing you could do for yourself is to consult with a TABC attorney.
Liquor licenses in general are often the hardest to obtain because the jurisdiction involved often links the total number of such licenses to the population total within that area. If you need this type of license, get the process started as soon as possible. If you plan to purchase an existing bar you will need to negotiate the purchase by tying the purchase of it to your ability to obtain such a license.
How much does it cost to get such licenses? Even though the costs of obtaining alcohol licenses varies by state, you should establish a rough cost of $25,000 in your mind and seek the skilled services of a TABC attorney. In certain high density locations such as Los Angeles, it is almost impossible to obtain such a license. They use a lottery system and it may cost you more than $25,000 just to buy a ticket play, “Who Gets A License?” (It’s not really called that, even though that is what’s happening)
Carefully check the legalities of operating such a business before you leap into that project with both feet. Remember, if you want to sell liquor, obtaining a license in most any town is usually difficult because it generally revolves around an ethics issue. So be patient with the locality involved.