10 Permits and Licenses Needed To Open A Liquor Store

Congratulations! You’re about to enter a dynamic and exciting retail sector that’s transforming before our eyes. From the craft beer revolution to the low ABV / non-alcoholic boom, liquor stores are fueled by customer demand like few businesses are. Health trends, innovative packaging, and sustainable sourcing are hot topics for owners of bottle shops. But there’s a decidedly less thrilling and even more important area that’s critical to your success: licenses and permits.

Getting the right liquor store licenses is a key ingredient to your small business launch. You’re not alone if you find it hard to navigate the tangled web of city, state, and federal requirements. Maybe you don’t have time to look up which licenses and permits your liquor store needs. Perhaps you’re new to the industry and unsure of your county’s rules or regulations — or you know your way around premium spirits but simply don’t have the bandwidth to get started on the permit process.

You might be shocked to learn most states (all but nine) don’t require retail stores to have general business licenses to operate. But you’re not off the hook: your city, county, and industry will all have unique applications and requirements. And there are many other licenses beyond that. It’s a lot to navigate when you already have so much on your plate. 

That’s what we’re here for. We’ve identified the eleven general licenses and permits that most liquor store owners should be familiar with, and we’ve mapped out a timeline for you to complete them. 

If you need guidance on navigating the legal and regulatory requirements for liquor stores, here are answers to frequently asked questions.

What Licenses Do You Need to Open a Liquor Store?

1. General Business License

This license or permit is required by a government entity to conduct business. It seems simple enough, but the process can get complicated thanks to the muddling of local, state, and federal jurisdictions, and there is no one-stop-shop online where you can do your research. The ultimate reason for a business license is to ensure your liquor store is safe for the public. That’s why certain “riskier” businesses have stricter requirements. For instance, a street vendor might not need a license to sell baseball caps, whereas a deli or bakery, which inherently has the chance of food poisoning, certainly will.

How to Get a General Business License?

Check out your local city or county’s zoning office to find the business license application. If you Google “Your State + Business License Application,” you should be able to find it along with any requirements. You can also call your mayor’s office, county administrator, or Secretary of State.

How Much Does a General Business License Cost?

The cost varies depending on the region and your business type. That said, most business licenses cost $25 to $400 depending on the type of business, and there is often a registration fee of $50. Keep in mind you’ll probably have to renew your business license at least once a year.

2. Employer Identification Number (EIN)

Think of the EIN as the Social Security Number for your liquor store. It will be used for tax purposes; all businesses need one, except for sole proprietors with no employees. This should be one of the very first licenses you secure since you will likely need this on applications for business licenses and other permits. 

How do I get an EIN?

You can get your EIN through the IRS online, but they only issue one per day. The application portal is open Monday through Friday, 7 a.m. to 10 p.m. EST, so you should jump on this first thing in the morning.

How much does an EIN cost?

Obtaining an EIN is free!

3. Certificate of Occupancy

A certificate of occupancy is a legal document that proves a structure, such as a storefront or warehouse, is safe to inhabit. It serves as proof that your business property is up to code and that the location is being used as intended. Without a CO, a liquor store cannot legally operate.

How do I get a Certificate of Occupancy?

Contact your local building or zoning inspection office and ask what documentation you'll need to provide to secure your CO. The information will most likely be posted on your local government's website. 

How much does a Certificate of Occupancy cost?

The cost varies from jurisdiction to jurisdiction, but they typically run around $100 plus an additional fee for every square foot in the building.

4. “DBA” or “Doing Business As” Permit

This also goes by a mysterious name: The Fictitious Business Name Permit. Any business that uses a business name different from the owner’s legal name may need this. When you form a business, its legal name automatically defaults to the name of the person who owns it unless you launch it as an LLC.

How Do I Get a DBA Permit?

Just like the general business permit, DBA requirements vary by jurisdiction. You can file your paperwork with your county clerk’s office or your state government.

How Much Does a DBA Cost?

You can expect filing fees in the range of $10 to $100, and some states may ask you to place a fictitious name ad in a local newspaper for a set amount of time to fulfill a public notice requirement.

5. Lottery License

Liquor stores and lottery tickets traditionally go hand-in-hand. In California, for instance, liquor stores have sold more winning tickets than any grocery store, gas station, or mom-and-pop shop, according to research by NBC. Getting your lottery license is a win-win. The proceeds fund public education or other social services programs, and you earn a 5% to 8% profit for each ticket sold. Retailers may also be rewarded for cashing winning tickets or exceeding sales goals. On top of that, people who buy lottery tickets also spend more in your store. The average “basket” of goods purchased by a lottery customer is traditionally 50% more than the non-lottery customer, according to Convenience.org.

How Do I Get a Lottery License?

Most state lotteries post their application forms online. Search on your state name and “Lottery” or “Bureau of Alcoholic Beverages and Lottery Operations.” Expect to undergo a criminal background check and a credit check by the Department of Consumer Protection, which may also ask for your W-9 tax form to ensure you’re up to date on state and local taxes.

How Much Does a Lottery License Cost?

A lottery license costs around $500, which includes the equipment, a nominal application fee, and a government background check.

6. Building permits

You might be renovating the interior, moving walls, or building a brand-new store from the ground up. Even if you’re taking over an established market, a change in ownership is rarely plug-and-play. You might find that electrical, plumbing, or HVAC need updating, all classic trouble spots in older buildings. Whatever the situation, you’ll want to research the permit requirements in your area to make sure you comply with all local codes, which can vary from city to city.

Also, check into zoning permits to ensure your location is zoned for commercial use (zoning is why you’ll never see a liquor store next to a school).

How To Get a Building Permit

Start with the website of your local city or town, which typically provides relevant documents and application forms online. If you’re making significant changes, like removing support walls or changing the footprint of your space, plan on providing documentation from a licensed engineer or architect. Once the permit is obtained, the work covered must be inspected by the Building Department. Each permit will include a list of the required inspections.

How Much Does it Cost to Get a Building Permit?

Building permits can range from $50 for minor changes to more than $2,000 for total remodels.

7. Health Permits

There will always be the tiny liquor store on the corner where you just grab and go, but many bottle shops now double as community gathering spaces, hosting tastings and educational nights where imbibing is involved. Chances are your liquor store will need a health permit. This permit, also known as an environmental health permit, ensures that the business premises meet all hygiene and health safety regulations, including proper sanitation, ventilation, and even lighting.

How to Get a Health Permit

Check with your County Health Department for rules and application forms. To obtain this permit, you’ll need a detailed floor plan indicating room dimensions, occupants, emergency exits, and more. You should also have a list of all materials used for your liquor store, including cleaning products and any special equipment. 

How Much Does It Cost to Get a Health Permit?

The cost of obtaining a health permit varies by certification area, so it’s best to check with your local health department for further information. In California, for instance, it can range from $700 to $2000. 

8. Liquor License

Every liquor store in the U.S. must apply for a liquor license. Some states may require a liquor license and a beer and wine license. There are two major types: On-license is for those who intend to sell alcohol consumed on premises, like a bar or restaurant. Off-licenses are for businesses that sell alcohol that will be consumed off-premises, like traditional liquor stores. The application process can sometimes take months, so apply for a liquor license as soon as possible.

How to Get a Liquor License

Liquor licenses: Start your journey here to find out which department you’ll be dealing with in your state and what rules and laws your state requires.

How Much Does a Liquor License Cost?

The price varies by state. A liquor license costs as little as $100 in Idaho and as much as $1,400 in California.

9. Sales Tax License

Some states call this a “seller’s permit,” its function is to allow the state to identify your store as a sales tax collector. It’s needed to sell almost all products and services. Most businesses, especially in the food and beverage industry, need to obtain a seller's permit as well as a resale certificate (more on that next).

How to Get a Seller's Permit

You can register online for a seller's permit by visiting your state’s Department of Revenue. Online registration, phone assistance, and in-person assistance are often available.

How Much Does a Seller's Permit Cost?

Applying for the sales tax license is free, but you may have to leave a security deposit if you have unpaid taxes. The amount of this deposit will be determined when you apply.

10. Resale Permit

No small business wants to pay unnecessary taxes. If you buy goods from other suppliers solely for resale purposes, you’ll need a resale permit so that you only pay sales tax once on these products. Without a resale permit, you’ll be paying tax twice: first, when you buy the inventory from a supplier, and then again when you sell it to a customer. Instead, goods purchased exclusively for resale will be subject to sales tax only when they are finally sold to a customer for personal use.

How to Get a Resale Permit

Each state has its own rules about resale permits, and not all of them require one. To get started, visit the Department of Taxation and Finance for the state in which you conduct business. Typically, the forms and documents are available online. Keep in mind that if you conduct business in other states, you’ll need to apply for “nexus” permits in each state where your goods or services are sold. You’ll be asked to provide your bank account numbers and projected monthly sales.

How Much Does a Resale Permit Cost?

This permit can cost from $0 to $50.

11. Commercial Sign Permit

For liquor stores, signage could be the cornerstone of your marketing strategy. After all, it’s an inexpensive but highly effective way to entice new customers to your business. Before you install a sign, you’ll need a permit from the city, which will have restrictions on the size, style, and lighting intensity. Elon Musk learned this the hard way when he installed a giant flashing “X” sign atop his San Francisco headquarters after acquiring Twitter. When complaints flooded in from nearby residents, the city discovered he didn’t have a permit, and he was forced to take it down after a few days (a permit might be required for dismantling, too).

How to Get a Commerical Sign Permit

Outdoor signs often need to be approved by the local government. In San Francisco, for instance, you can research the sign rules on the city’s website and then visit the permit center in person to complete the appropriate application. Business owners may need to submit construction drawings drafted by a licensed architect, engineer, or contractor. Check with your city about awning permits as well.

How Much Does a Commercial Sign Permit Cost?

A sign permit can cost between $20 and $50.

Timeline for Opening a Liquor Store

12 Months Out

First things first, you’ll want to make sure your bottle shop actually exists in the real world (and not just in your wildest dreams). This means filing and registering your business with the Federal Government, the state, and your local municipality.

DBA- Doing Business As

The name of your business is the bedrock of your brand and must be established before you can even think about things like marketing, signage, and a website. Top priority? Check your state's official database to find out if the name you want is available. Once your DBA is established, you can open a business bank account, undertake transactions for your company, and search for a killer domain name for your website.

In some states, you’ll need to publish a statement in a local newspaper near your place of business within a month of filing and let the ad run for several weeks. You may also be required to file an affidavit after the last publish date. Check with your local Registrar-Recorder/County Clerk’s Office for specific requirements. 

EIN

A tax ID number (EIN) is another crucial piece to have in place early on. Without it, your liquor store simply won’t get off the ground. You’ll need it to file federal tax returns, to open a business bank account, or to apply for a credit card. When it comes to invoicing, many companies won’t even pay you without an EIN. It’ll also come in handy when you apply for your General Business License (up next), as many states require this number on applications. 

You can apply online or using IRS Form SS-4 (“Application for Employer Identification Number”).  You’ll need to provide basic information about your business, including your industry type and projected number of employees.  

General Business License 

Since you need this to conduct business legally, it’s best to get the ball rolling on this stat as soon as you have your business plan in hand. You’ll be asked for basic info, including your business name, EIN, business type (for instance, LLC), and anticipated revenues and expenses. Gathering your key details could take a while, so we recommend checking these requirements well in advance. 

Nine Months Out

Now that you’ve established your small business in the eyes of the government, it’s time to tackle the most notorious licenses and permits: Liquor, Building, and Health. These three licenses have a reputation for delays, so you’ll want a lot of lead time before your launch. 

Liquor license

Alcohol is one of the most heavily regulated products in the U.S., so it’s no surprise that getting a liquor license can be super complicated and expensive. The entire process can take anywhere from 40 days to 6 months or more, so jumping on this early is essential. Each jurisdiction differs in how liquor licenses are approved: some leave it to state agencies, called Alcoholic Beverage Control (ABC), to handle, but some counties and cities may also require them. You’ll likely have a preliminary application followed by an in-person appointment with an official who screens applicants. Expect to reveal personal financial information and undergo credit and background checks.

Building Permits

As soon as you secure your location, you’ll need to get the ball rolling on the building permits. Though we recommend starting nine months out, some businesses begin the process a year or two in advance if they’re making significant renovations or building a brand-new property. The timing all depends on your situation. Once approved, the city or county will also require in-person inspections to ensure your space and processes are up to code. It’s not until your business passes the final inspection that you’ll get your permit to open.

Health Permit

Most beverage-related ventures require health permits to ensure the safety of customers and employees. When you apply for a health permit, which can often be done online with your County Health Department, you’ll need an inspection to ensure your space and practices will fit all applicable codes and ordinances. That’s where problems and delays can potentially arise.  You may be asked to revise your layout or change your building. You will receive your health permit once your business is deemed safe to operate.

6 Months Out 

Resale Permit

If you’re buying goods from a wholesaler or supplier to resell them, you’ll need this permit to avoid being double-taxed. While you may not be stocking up your inventory just yet, it’s great to get this off your plate so you can focus on the permits to come. You’ll need basic personal information for every partner or owner in your business. This ranges from easy stuff (like your EIN) to projected monthly sales, which you can pull from your business plan.

Sales Tax License

The resale permit and the sales tax license go hand-in-hand. Every state with a sales tax requires businesses to register for a sales tax permit before collecting or paying taxes. Most states encourage businesses to register online, and you’ll be asked to provide similar information to the resale permit. You’re required to hold a seller permit in states where you have “nexus,” which is a fancy way of saying that you have a connection with a state that’s significant enough to trigger a sales tax obligation. Registration for your sales tax license, or “seller’s permit,” can take up to a month.

3 Months Out

Commercial Sign Permit

It’s up to you how far in advance you want your sign on your building. Installing a sign early can create excitement and curiosity in your community as people drive by. The average time for a sign permit is 10 to 30 days, but it can be shorter or longer depending on what you need to do. Heads up: many cities require plans from a licensed architect or consultant, so you’ll need to have your brand identity locked in and a designer on board well before you apply. Remember that historic districts may take longer than other areas because of stricter regulations.

Certificate of Occupancy 

Your liquor store can’t open its doors to the public unless the “C.O.” is in place. A building inspector will review your city permits and inspect your property's interior and exterior to ensure compliance with all building codes. If any violations are noticed, you’ll typically have 60 days to make changes to avoid additional fees.

Lottery License

Most lottery licenses take about 30 days to process, allowing time for credit, tax, and background checks. Once the license is granted, you will need to set up a dedicated lottery bank account and install a machine at your shop, with mandatory training to follow. Once you open for business, you’ll be required to sell a minimum number of tickets every month, and your equipment must be kept running 24/7. 

***

Navigating business permits and licenses is no easy feat, and in the end, you may feel like you’ve earned a Ph.D. in government administration.  However, it’s a challenge that all business owners must face. Once you’ve mastered this, you can focus on the good stuff: mastering the economies of scale, driving down costs, and growing your incredible new business.