Opening a wine/liquor store

[Kcwhippet]

Profit margin is variable. First, what you need is to price your wines competitively with the shops in your area that are selling the same or similar wines you want to sell. That will go a long way toward defining your gross profit margin BEFORE expenses, including licenses, employee costs, facility costs, etc. A general rule of thumb is to divide your cost of a case of wine from the distributor by eight to come up with a retail bottle cost. For instance, if you buy a case from your distributor for $240, divide that by eight and your retail selling price is $30 ($29.99 sounds much cheaper to a customer). So, you pay $20 and sell for $29.99 giving you a gross margin on that particular wine of $9.99. Got that?
Licensing is always a local thing, so you have to check with your local licensing authorities, first to see if there's even a license available for the area you want to sell in. Then, do you want a full license, or just a wine and beer license, or even a wine only license. It's all local law.
Inventory levels and turnover all depend on what you decide to carry for stock and how that stock currently sells in your general area. Lots more to consider, but the most important is - if you have little or no experience in this area - DON'T DO IT! I went into a small shop nearby that's going out of business, and no wonder. They had a bottle of 1996 Sutter Home Chenin Blanc on the shelf.

[This message has been edited by Kcwhippet (edited 04-09-2003).]