TABC & The Texas Liquor License

Adding alcohol sales to your business might be one of the smartest steps in your business plan. This is because alcohol has some of the highest profit margins, ranging from 60% to 85%. The first thing you’ll learn when you start the liquor license process is that the entire alcohol market is tightly governed in Texas. Jumping through all the hoops will be worth it when you can pop the champagne and start selling alcohol from your business.  As you begin on your journey, remember that one thing that is guaranteed when starting a business is that it will have its ups and downs, just remind yourself of those high alcohol margins!

TABC Legal Requirements

The Texas Alcoholic Beverage Commission (TABC) regulates all parts of the alcoholic beverage industry, including advertising, sales, manufacturing, importation, taxation, and transporting.

You will be not be eligible for a Texas liquor license if:

•  You’re under 21 years old.
•  You’ve violated the alcohol code with any act that involved “moral turpitude” within the past 6 months.
•  You’ve violated the Texas liquor and alcohol code in the past 2 years.
•  You’ve had a felony conviction in the past 5 years.
•  You have tax debt.
•  You have not demonstrated “good moral character.”

Along with meeting the state’s rules and regulations, some counties and cities have their own local ordinances, zoning restrictions, fees, standards for late-hour business operation, and even certificate of occupancy requirements. After contacting the TABC, also reach out to your City Clerk’s Office or City Secretary for specific alcoholic beverage permits.

The Texas Liquor License Process

In total, the process can take about 50 days. You can complete it online at the TABC website through the Alcohol Industry Management System (AIMS). Below is an overview of what you need to get started with AIMS:

• Complete AIMS onboarding.
• Choose a tier of the alcohol industry i.e., manufacturing, distributing, or selling.
• Create and register your business. The Small Business Administration has resources to help you with registration requirements.
• Get the required signs. Visit TABC’s Sign Requirements page to learn more.
• Complete your AIMS application and get TABC certifications.
• Submit the completed application.
• Keep wait time in mind. It can take about 50 days from the time TABC receives a completed application to issue a new license.

There are three tiers of liquor licenses in Texas: manufacturing, distribution/wholesale, and retail. Manufacturers produce the alcoholic drinks, distributors and wholesalers transfer the drinks to stores/businesses, and retailers sell the drinks directly to consumers. Along with the license, the businesses in each tier may have different insurance requirements. For example, a manufacturer will likely need general liability insurance, a distributor may need small business insurance, and a retailer would need retail insurance. If you sell alcohol at all, you will most likely need liquor liability insurance. 

It’s best to contact the TABC if you don’t know which tier your business is in. Also the licenses vary based on a variety of factors, including what type of business you have, whether you need a temporary permit or a long-term license, and whether there will be on premise or off premise consumption.

One Day TABC Liquor Licenses