Opening a bar is about a little more than choosing the perfect beer and liquor list. In fact, there are a number of restaurant licenses and permits that you need to get out of the way before you can open your doors for business. In getting caught up in dreaming about all the delicious drinks that a new restaurant owner plans to offer, many forget about the extent of the legalities they have to navigate first, legalities that can throw a serious wrench in your grand opening plans if they aren’t executed correctly.
Although alcohol laws will vary from state to state, attempting to open a bar without a liquor license is going to lead down a road of penalties, fines, and shut doors—all of which every restaurateur wants to avoid at all costs.
Here’s how to get a liquor license, no matter where your bar or restaurant is located.
1. What Is A Liquor License?
First things first—let’s cover what a liquor license is in the first place. A liquor license is a permit to sell alcoholic beverages. It might seem relatively straight forward, but believe it or not, there are different kinds of liquor licenses. The first thing you’ll need to do is understand what type of liquor license you’ll need and what the exact laws are regarding liquor licenses based on your specific location.
- Know your state’s alcohol laws. Each state has its own laws and requirements regarding the supply of liquor licenses. In fact, some states even limit the number of locations that can sell alcohol at any given time, which can make it difficult for new bars and restaurants to get a license immediately. The first thing to do when exploring how to get a liquor license it by researching your specific city and state’s liquor laws.
- Each state has its own Alcohol Beverage Control (ABC) Board. This agency is in charge of regulating the sale of alcohol. This is who you will contact to understand your state’s laws and the process of how to get a liquor license in your specific state.
While each state is different, here are laws for a number of U.S. states:
- New York: The New York State Liquor Authority runs the show in New York and liquor licenses are handled by what’s known as Alcoholic Beverage Control Laws, or ABC laws. There are 11 articles on the books that deal with liquor licenses, which you can access here.
- California: In California, you’ll be charged with following California ABC laws, rules, and regulations. You’ll mainly be dealing with California Code, Title 4, which references business regulations, during the process. You can learn more about the process in California here.
- Washington: In Washington, the Washington Liquor and Cannabis Board is in charge of liquor licenses. In Washington, a liquor license is obtained by getting a liquor endorsement on your business license, which is managed by the Washington State Department of Revenue Business Licensing Service. This means that you’ll be dealing with two separate but related entities throughout the process. This website breaks it down.
- Texas: The Texas Alcoholic Beverage Code determines liquor licensing in the Lone Star State. This website answers all of the common questions that surround getting a liquor license in Texas.
- Minnesota: The Minnesota Department of Public Safety manages liquor licenses, which can vary based on the type of establishment. Liquor licenses are governed under Minnesota Statutes 340A.404 subdivision 5. This website answers common questions about everything from bringing homemade wine to organized events, to looking up a liquor license number.
- Massachusetts: The Alcoholic Beverages Control Commission is charged with enforcing the liquor laws that are housed within Chapter 138 of Massachusetts General Law. These laws, which you can read about here, govern everything from discrimination in licensing to pricing.
Attempting to open a bar without a liquor license is going to lead down a road of penalties.
2. Determine Liquor License Classifications
There are two main types of liquor licenses: on-license and off-license. The type of liquor license you’ll need depends on how you’ll want to sell liquor.
- You will need an on-license liquor license if the liquor you sell is intended to be consumed on the premises of your business – for example, a bar or restaurant.
- You will need an off-license if the liquor you sell is intended to be consumed off the premises – for example, a liquor store or grocery store.
When all is said and done, to obtain even just one of the proper licenses and permits can cost as much as 10,000 dollars. Luckily, the only resource you’ll need to open your doors with the right licenses and permits is here.Get The Guide
As a bar or restaurant owner, you’ll always be looking to obtain an on-license liquor license; however, in most states, there are different classes of liquor licenses still to keep in mind.
- Restaurant license – This license has a limit on what percent of a restaurant’s earnings can come from alcohol. There is no limit to what type of alcohol you sell, but you do need to keep the financial limit in mind. This percentage is usually in the region of 40%, so make sure you have that magic number top of mind as you run your business.
- Beer and wine license – If you don’t intend to serve “hard” liquor, this is what you’ll need. You are then, of course, limited to selling only beer and wine.
- Tavern license – If selling alcohol, as opposed to just beer and wine, is your primary source of business, this is the license you’ll need.
Plenty of restaurateurs embark on the journey to get a liquor license without really considering how long it’s going to take them to finish the process.
3. Managing The Liquor License Application Process
Once you understand the laws around how to get a liquor license, you’re ready to apply. There are a few things you’ll want to keep in mind in order to understand everything from the cost of getting a liquor license to how long it takes to get a liquor license.
- How much does it cost to get a liquor license? The cost of obtaining a liquor license can vary greatly depending on the state. Full liquor licenses can range from $12,000 to $400,000. Beer and wine liquor licenses can cost as low as $3,000. The actual cost you can expect to pay really depends. The best way to estimate it is by chatting with bars and restaurants in your local area that are similar in size and scope to yours.
- How old do you have to be to get a liquor license? Like all things related to alcohol in the United States, a person must be 21 years of age to work in a bar or obtain a liquor license.
- What information is required to get a liquor license? In addition to personal information, you may also be required to provide additional restaurant licenses and permits you’ve obtained, as well as a certificate of incorporation, employee identification number (EIN), a partnership agreement, a proposed food menu, your company constitution, and a copy of the certificate of title for the premises.
4. Understanding The Liquor License Time Commitment
Plenty of restaurateurs embark on the journey to get a liquor license without really considering how long it’s going to take them to finish the process. Managing the timing of your liquor license and planning appropriately will stop you from having to guess at how long it takes to get a liquor license and will make sure that you’re legally able to whip up all the drinks you want to feature at your grand opening.
Once you’ve had your liquor license approved, keep in mind that you will be required to renew it yearly, which does involve a fee. (If you stay in good standing with your local agency throughout the year, you may be entitled to a reduced fee). Also, the more years you go through the process, the more automatic and systematic it’ll become and before you know it, renewing your liquor licence will be just another run of the mill part of the job.
What other restaurant licenses and permits do you need to open your bar? Check them out here.