Liquor stores are subject to some of the most arcane rules in retailing that vary dramatically by state or county. For example, certain types of liquor may not be sold at certain times. As a result, record keeping is complicated and the costs for not complying can be very high. Additionally, in some states, distributors are assigned by the state to particular retailers. Further complicating matters, different tax rates may apply to different products, making point-of-sale transactions even more complex.
General ledger, accounts receivable, accounts payable and payroll are all software features that are typical to general retail. And while there may be some customer relationship management issues specific to liquor store retail, inventory management presents the biggest challenge because of the number of different items on-hand.
Key Requirements for Liquor Stores
While evaluating systems, buyers should consider the following functions to meet their unique requirements:
|Localization||Liquor laws vary greatly, sometimes even within the same state. Compliance is particularly challenging to chain stores where each location may have different regulations. The system needs to support localization to support any required compliance reporting.|
|Inventory management||In addition to typical inventory management, liquor store inventory software must show the supplier for each bottle. Jurisdictions have different requirements for how long records must be kept.|
|Integration with distributors||The inventory system should integrate with distributors’ systems to make ordering easier, and to provide advance shipment notice (ASN) to make receiving inventory more accurate and less prone to shrinkage.|
|ID scanning||The system should scan and retain ID information for buyers and verify that the format of the ID is correct. However, it is often impractical to validate the IDs against government databases.|
|Employee auditing||One of the key management reports is the employee audit, which looks at profitability and transactions by employee. This helps protect the bottom line and helps prevent inventory shrinkage by holding employees accountable.|
|Security system integration||These stores in particular benefit from integration between the liquor store POS system and a security system, linking security recordings with transaction records.|
|UPC code database||Liquor stores carry small amounts of many items. Building an inventory from scratch could take weeks; the inventory system must include a UPC code catalog with descriptions for common items to save time in building the inventory.|
|Price maintenance and sale management||Prices in stores usually change by manufacturer or by class of item. The system should accept percent or dollar amount price changes across these areas.|
|Gift set packaging||One of the key promotions for liquor stores are gift sets. The liquor store POS system must support gift set sales for a single price but correctly decrease inventory levels for the individual items when a gift set is sold.|
Market Trends You Should Understand
- Software-as-a-Service (SaaS) & POS. When evaluating liquor POS software, there are two main deployment models buyers can choose from. With an on-premise deployment, buyers commonly purchase a software license up-front. Retailers are typically responsible for hardware maintenance and software updates. With a SaaS deployment, vendors maintain and host the solution, which is accessed via a Web browser. SaaS POS solutions are often a good fit for independent stores that don’t want to invest in IT or hardware. If buyers are interested in a web-based solution, they should ensure it has the features and functionality listed above to work in a liquor-store environment.
- Mobile Point of Sale. Vendors like Square and PayPal have made mobile payment processing a popular option for business owners looking for another option outside of traditional point of sale software. For liquor store owners, this is probably not a viable option, as ID scanning and liquor inventory control are necessary components, and many of these solutions lack these and similar functions. However, many vendors now offer mobile versions of their point of sale solutions, or additional modules that can run on tablets and smartphones. This is a better option for liquor store owners that would like to use an iPad, android tablet, smartphone or any other mobile device in the store.
- Integrated Retail CRM. Other than using social media, businesses can improve their marketing capabilities if they deploy a point of sale solution with integrated customer management features. mPower Beverage, for example, includes loyalty program management so store owners can provide rewards cards to its customers. In addition, this POS vendor allows users to store customers’ purchase histories, addresses, phone numbers and birthdays.