Liquor Store Feasibility Study in Delaware

Over-indexed in a small state

Liquor retail is a bigger part of Delaware's SBA lending than of the national mix. The location quotient of 1.40x shows it, and the class lands at 7 of 39 in Delaware's own ranking, though the state ranks only 31 of 53 on raw loan count, a result of Delaware's small size. SBA's FY2017 to FY2026 files hold 28 such loans totalling $16.4 million gross. The loans are small even for the class: the median of $186,750 is 0.41x the national median, and the middle half lies between $50,000 and $812,750. Delaware liquor lending therefore looks like a set of modest purchases and refits rather than large real estate deals.

Lenders and geography

SBA 7(a) accounts for 27 loans and SBA 504 for 1, and franchise share is 0.00%. Three institutions appear in the 7(a) table: Manufacturers and Traders Trust Company with 7 loans and $2.3 million, TD Bank, National Association with 6 loans and $340,000, and Wilmington Savings Fund Society FSB with 5 loans and $7.0 million. That last lender made fewer but far larger loans. The page draws on SBA's holder field, not on any statement of practice. New Castle County has 20 loans, Sussex 7 and Kent 1. Yearly volume ranged from 6 in FY2018 to none in FY2019.

Outcomes held back

Delaware liquor stores get no printed cancellation or charge-off rate. The cohorts fall short of 30 loans, so any percentage would hinge on one file. The blank does not mean none occurred, and rates elsewhere on the site are floors.

What a Delaware liquor store study has to test

A licensed-retail plan hangs first on the license itself: whether one is available or transferable at the site, and what the state's rules and local approvals allow. After that comes demand, which for a store means households within convenient drive time, the competing outlets, and traffic that passes the door. Because Delaware sits beside larger neighboring markets, the study should also address how much custom might leave the state. Costs should be set beside the $186,750 median, splitting inventory and working capital from build-out and any purchase of a going concern. Debt service coverage has to hold on conservative margins, with inventory turnover shown. An appraiser will often value the business rather than a building, so goodwill and lease terms deserve a plain explanation.