Are you planning on opening a bar, restaurant or liquor store? One of the most important steps of opening or taking over a business is to get the most suitable license for you.
Of the 22 license types, these 5 are the most practical and common ones: 21-Off Sale General (Liquor Store) 41-On Sale Beer & Wine (Eating Place), 42-On Sale Beer & Wine Public Premises (Bar, Tavern) 47-On Sale General (Eating Place), and 48-On Sale General Public Premises (Bar, Nightclub).
21-OFF SALE GENERAL (Liquor Store): Authorizes the sale of beer, wine and distilled spirits for consumption off the premises where sold. Minors are allowed on the premises.
41-ON SALE BEER & WINE (Eating Placet): Authorizes the sale of beer and wine for consumption on or off the premises where sold. Distilled spirits may not be on the premises (except brandy, rum, or liqueurs for use solely for cooking purposes). Must operate and maintain the licensed premises as a bona fide eating place. Must maintain suitable kitchen facilities, and must make actual and substantial sales of meals for consumption on the premises. Minors are allowed on the premises.
42-ON SALE BEER & WINE PUBLIC PREMISES (Bar, Nightclub): Authorizes the sale of beer and wine for consumption on or off the premises where sold. No distilled spirits may be on the premises. Minors are not allowed to enter and remain. Food service is not required.
47-ON SALE GENERAL (Eating Place): Authorizes the sale of beer, wine and distilled spirits for consumption on the licensed premises. Authorizes the sale of beer and wine for consumption off the licensed premises. Must operate and maintain the licensed premises as a bona fide eating place. Must maintain suitable kitchen facilities, and must make actual and substantial sales of meals for consumption on the premises. Minors are allowed on the premises.
48-ON SALE GENERAL PUBLIC PREMISES (Bar, Nightclub): Authorizes the sale of beer, wine and distilled spirits for consumption on the premises where sold. Authorizes the sale of beer and wine for consumption off the premises where sold. Minors are not allowed to enter and remain. Food service is not required.
DECIDING WHICH LICENSE IS THE BEST FOR YOU
When deciding on the type of liquor license, you must consider three main aspects: Location, budget and business model. Determining location is very important because the location you choose may be in a restricted zone that does not allow alcohol sale or consumption. Also, ABC can limit the number of licenses in a city or county depending on the current number of issued licenses. You have to be sure that your location is not in a restricted zone or is not in a city/county has open slots for issuing new licenses.
After you have a suitable location, the next step is to consider the costs. The cost of licenses changes depending on your location and license type. For example, if you are in a neighborhood with many restaurants with a license 47, you might even have to buy your license 47 from a third party that is planning to sell their business and the cost of that license will be determined by the third party. There are brokerage firms in California specialized in acquiring liquor licenses: these firms can negotiate better prices for you. Another crucial aspect you must consider is your business model: do you plan on serving just beer & wine, or do you plan on having a full bar with hard liquor? A license 41 (beer & wine only license) does not allow hard liquor sale and consumption, but costs considerably less than a full liquor license. If you want to serve cocktails but fear you will be restricted by your license type, an easy and effective way to offer your customers a larger beverage selection is by using fermented spirits. Fermented Spirits is a great alternative to distilled spirits, and will even increase your profit margins.
As mentioned above, full liquor licenses (which authorizes the sale and consumption of distilled spirits), can't always be obtained from the ABC. When budget or other factors limit you from obtaining a full liquor license, businesses can obtain a license 41 or 42 (which only allows the sale and consumption of beer & wine). Then, they use fermented spirits instead of distilled spirits. Fermented spirits are produced by fermenting fruits & sugars to mimic characteristics of hard liquors. Fermented spirits allow businesses with a beer & wine license to offer their customers cocktails that call for traditional distilled spirits. More information can be found in our "fermented spirits" section at http://customerportal.garveywholesale.com
THE LAST STEPS
After you choose your license type, fill in the required forms and pay the fees, you will receive a post notice from the ABC. During this time, you are required to post the "an application to sell and consume alcoholic beverages is proposed for this location" notice to the public. If the ABC doesn't receive any negative feedback or complaints from the neighborhood, they will visit your business location for a detailed inspection. The whole process can take 3-12 months after you submit your application.