Liquor Store Funding: Loan Types, Needs & Qualifications

Liquor Store Funding: Loan Types, Needs & Qualifications
Ronis Gracie
on March 16, 2020
Read in 1 min

Liquor stores need business loans for a variety of reasons. Existing shops may seek funding to buy radio advertising, add new beverages or install security alarm systems. Numerous retailers decide to build additions so that they can open bottle redemption centers and carry more products.

Major Expenses

Some shopkeepers need financing when many bills come due at the same time. For example, refrigeration and air conditioning often yield high energy expenses in the summer. Such costs may prove burdensome when combined with liquor license renewal fees or property insurance premiums. Thieves frequently target retail establishments; the aftermath of burglary might necessitate extra funding as well.

liquor store funding

Financing Options

Liquor store owners can potentially qualify for several types of credit. Business equity loans use commercial assets as collateral, so it’s easier to get approved and pay a reasonable interest rate. Unsecured financing generally remains harder to access but doesn’t require collateral. Small Business Administration loans tend to have longer repayment periods and lower monthly costs.

Alternative solutions include commercial cash advances, credit cards, and various online loans. They’re easier and quicker to obtain but don’t always offer the lowest rates. In some cases, cash advance lenders calculate repayment amounts depending on a liquor store’s daily revenue. Business credit cards provide a convenient and flexible option. However, banks harshly penalize cardholders for late payments.

Loan Obstacles

Liquor retailers frequently need to contact numerous lenders before they succeed in gaining loans. This proves difficult for busy owners who work long hours to keep their stores open throughout the week. Some proprietors rent buildings and possess relatively little collateral. Furthermore, many banks only offer unnecessarily large business loans.


Lenders usually expect beverage store owners to prove they have the ability to produce sufficient revenue and repay their loans. This is easier to accomplish if a retailer has records that demonstrate previous profits. A favorable credit history and substantial equity can improve borrowing options. Loan approval becomes more feasible when a store has remained open for at least six months.

If someone needs funding to revive a failing shop, lending institutions will expect sophisticated planning. A potential borrower must convince them that he or she has a rational strategy to achieve long-term success in a specific locale. Credit scores also become more important in this situation. Commercial lenders generally favor stores that generate at least $8,000 in monthly revenue.

To sum it up, liquor store owners use a wide range of loans for several important purposes. Long work hours, credit history issues and frequent income fluctuations can make it difficult for them to access timely, affordable funding. Nonetheless, at least a few borrowing options remain available to many beverage retailers.

Ronis Gracie Finance Journalist

A serial entrepreneur experienced with building several small companies from the ground up and consulting for many others, Ronis understands the finer points of small business financing. He’s passionate about small business & is committed to simplifying small business lending for others.

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Late Payments Hurt Your Credit Score

Please be aware that missing a payment or making a late payment can negatively impact your credit score. To protect yourself and your credit history, make sure you only accept loan terms that you can afford to repay. If you cannot make a payment on time, you should contact your lenders and lending partners immediately and discuss how to handle late payments.