Liquor Store Feasibility Study in Colorado

Liquor stores take a share of Colorado's SBA lending far above their national share. The location quotient is 3.95x, liquor is 2 of 39 among Colorado's SBA classes, and among states Colorado is 2 of 53 for the class, on 690 approvals worth $531.0 million from FY2017 to FY2026. At $559,000, the median loan is the metric that differs from both Colorado lending generally and the class nationally, at 1.24x the national median for liquor stores.

Independent stores and one dominant lender

SBA 7(a) carries 666 of the loans and SBA 504 just 24, and franchise units are 0.14% of the book, so this is a market of independent stores. Hanmi Bank holds 360 of the 7(a) loans worth $300.4 million, by far the largest position; Bank of Hope holds 44, U.S. Bank, National Association 22, PCB Bank 17 and VelocitySBA, LLC 16. B:Side Capital leads the 504 holders with 17 loans. Hanmi's count is taken from SBA's present-holder records, so it can include loans bought from other banks. The middle half of loans runs from $350,000 to $973,750.

Strong outcomes on both measures

Cancellation after approval is 8.5% at both the floor and the ceiling, which means almost no Colorado liquor store approval in the FY2017 to FY2024 cohort was still waiting to fund. Losses are modest: the floor is 3.2% across 311 loans disbursed in FY2017 to FY2021, and only 0.64% came inside five years of approval, which places most Colorado liquor losses late in the loan's life. Approvals rose from 45 in FY2020 to 90 and $75.6 million in FY2021, and FY2026 brought 71 approvals and $76.4 million.

What a Colorado liquor store study must test

Demand testing should map competing stores in the trade area, and the most SBA-active counties are Arapahoe with 111 approvals, Jefferson with 107, Denver with 90, Adams with 85 and El Paso with 62. A buyer's study has to verify the seller's sales from tax filings and test how a new competitor nearby would affect them. Cost testing covers inventory, fixtures and, where it is bought, the building. Debt service coverage should rest on verified gross margin rather than sales alone, and the valuation has to support the goodwill in the price. The license transfer must be in the timeline before closing. The liquor store class has a clean industry code, with no caveat attached.