Navigating Liquor License Quotas

navigating the liquor license quotat systemMany would-be restaurateurs and pub owners, as well as national chains interested in expanding into new states or geographic regions, can find many roadblocks when navigating liquor license quotas in states that have them. Not the least of these roadblocks may be exorbitant prices due to supply and demand economics.

We noted recently in “Rising Liquor License Prices” that a million bucks for a liquor license, while outlandish, is not unthinkable in some areas. Additionally, while owning a liquor license in a quota state may seem like sitting on a gold mine (provided the quota system remains intact), there are instances in which it becomes difficult or nearly impossible to transfer a liquor license, depending on jurisdictional regulations.

Matching Liquor License Buyers and Sellers

Buying and selling liquor licenses in states with quota systems is a lot like buying and selling real estate. The number of liquor licenses (excluding those in states and municipalities that allow additional licenses above the quota for special exceptions like economic development zones) is fixed. Likewise, the amount of land (with or without houses on it) in the country is fixed. If you want to buy, you have to find someone who wants to sell… and sell at a price and in a place that you deem reasonable.

Very few people attempt to go through the real estate sales process (whether buying or selling) without a knowledgeable agent. A good agent can do the legwork and research to find the right property at the right price and has the legal connections to make the process relatively seamless and fully legal.

The same thing holds true in buying or selling a liquor license, particularly in states with quota systems. A good broker knows the liquor license landscape including values and the state and municipal regulations.

To continue the analogy, a real estate agent can help you determine the right type of property for you. You may be envisioning a maintenance-free condo; however, its rules and regulations may not fit your lifestyle or desires for the property. The same holds true for liquor licenses: You want to be certain you invest in the right type of license, and depending on the state, that can be a very lengthy list.

A liquor license broker can expedite the process and guide you in the right direction. In full transparency, it’s what we do at Atlantic License Brokers in Boston and throughout Massachusetts as well as in other states across the country. We’ve seen the turmoil that’s caused when quota system changes are proposed (as recently happened in Massachusetts) and understand both sides of the issue. Very simply, we understand the realities of liquor licensing better than anyone and are perfectly positioned to help navigate liquor license quotas and the entire liquor license system.