Purchase a wine shop?-Help!

I have been offered the chance to purchase a small wine shop. I looks like a great opportunity. I am well aware of the current economic climate, but the shop is located in a university/medical community which seems to be somewhat insulated from the recession.( Countywide unemployment is 2.2% )I know many of you are or have been wine retailers. I would appreciate any guidance you may have to offer. Thank you !

CHEERS !

Art

yike!
1. how much do you know about wine?
2. how much do you know about retailing?
3. how deep are your pockets?
4. so why is it for sale if it is such a good opportunity?
5. who is currently selling wine in the area and can you realistically compete?
You need a business plan; and a bank - don't use your own money!
WARNING! WARNING! WARNING!

David- I have a fairly good working knowledge of wine and I have over 20 yrs. of retail experience. The current owner is a friend who wishes to pursue other interests. She is willing to finance 2/3 of the purchase and stay on in an advisory capacity for as long as necessary. There is one other specialty wine shop in the area, with two locations. She has competed well with them for 7 yrs.

Before you buy, ask the present owner to introduce you to all the distributor reps she deals with. Ask THEM what they think of the deal. Even though they'll lie to you--after all, they're reps--you may gain some insight. Talk to the delivery drivers, too. They know who's buying and who isn't, and may provide clues to the health of the business in the local market.

listen to what dave erickson said. the drivers know the real deal about how well everyone is doing. you've answered my questions quite satisfactorily; but it doesn't hurt to go a bit further. still, don't use your own money. that's what the bank is for.

still, don't use your own money. that's what the bank is for.

That is one of the reasons why we are in this housing crisis. People not using their own money to purchase things they could not afford.

That is one of the reasons why we are in this housing crisis. People not using their own money to purchase things they could not afford.

Errr......I think this has now gone beyond a housing crisis.

I have been offered the chance to purchase a small wine shop. I looks like a great opportunity.

After you've done all your homework and it still looks like a great opportunity, ask yourself if the prospect makes your heart sing. If it does and you can afford to take the chance, I say do it. If it doesn't, pass.

I have no wine specific business experience but my wife does have a business but without the retail store and many close friends are running small businesses and one of those is a retail wine store. The biggest issues I would be concerned about would be
1. Are you willing to live it. This is much different than working retail. The job does not end when your shift is up. Its a 24/7 situation. I know many people who think they understand this point but don't until they actually have to live it.
2. What is the distributor situation in your area and how much of the store's stock is coming via distributors that may be financially unsound. My friend that runs a wine shop in Ohio tells me that many of the smaller operations are dangerously close to closing up shop due to too much product and not enough cash. Ohio is an extreme case since the state minimum pricing created a situation where distributors had greater margin control and thus felt more secure with less cash reserves leaving them vulnerable now. However, the concern for you should be can you run the type of store you want and make a reasonable profit if your distributor options consolidate. Will product become more limited or margins squeeze. Does it still like a good opportunity if this happens.

If I had the opportunity and funds to do it, I would jump at such an opportunity. I think a soundly run business can easily survive and possible thrive in anything but the worst of financial scenarios. I wish you luck.

Thanks to all of you for your insightful advice. I have already condidered many of these concerns, but it's helpful to see them verbalized by others.