Data Point: Probability of Winning the Liquor License Lottery
Florida’s public drawing for quota alcoholic beverage licenses has become increasingly popular in recent years, partially due to increased media coverage and social media chatter. The Data Point series analyzes the numbers behind state-level regulatory rules and efforts in Florida. This installation digs deeper into the probability of winning the drawing, better known as the liquor license lottery.
After an all-time record of 27,974 entries for 59 licenses last year, the Division of Alcoholic Beverages and Tobacco just revealed that 23,728 entries were accepted for the 51 currently-available licenses. It’s tempting to do the quick math to determine one’s chances of winning the lottery — 23,728 entries for 51 licenses means that there were 465.25 entries for each license. That’s marginally better than the 474.14 entrants per license the previous year, but deeper calculations are required to get a clear picture.
Quota liquor licenses are created and issued on a county-by-county basis, and cannot be moved across county lines. That means that if licenses are available in 30 counties, there are effectively 30 separate drawings occurring at one time. These variables can result in wildly different chances of victory, depending on what year and what county it is. The following examples are illustrative.
Leon County has long offered the worst chances of being selected, partially due to the high values of its licenses. In a year where 465.25 entries were submitted per each license available statewide, a massive 1,186 entries were submitted for Leon County’s single license. Leon County had licenses in the lottery three times over the last five years, and each year it had the highest number of entrants per license. Nonetheless, operators in Leon County will continue to enter despite the odds due to the robust opportunities for bars in the areas around the colleges.
On the other hand, the variables of the public drawing process also lead to some outlier results in the other direction. In 2014, only 92 entries were submitted for three (!) licenses in Polk County. Only 51 entries were in the pool for a Taylor County license that same year. Putnam County entrants in 2018 had a 1/59 chance of being selected. These historical examples have led some entrants to target small or rapidly-growing counties as a strategy, but part of the reason there are so few entrants is that demand for a liquor-serving establishment in the county is low. Moreover, given the growth of the entrant pool from 3,205 in 2012 to well over 20,000 in 2019, these types of outliers may be relics of the past. Perhaps it was only good while it lasted, or could entrant participation wane during the pandemic?
The key question is which county is the best to enter for? The answer ultimately depends on what the entrant wants to do with the license. There’s no strategy that guarantees a selection, of course, but having an understanding of each county’s history in the lottery provides some interesting context during the entry process.
The firm’s full liquor license lottery resource is available at quotalottery.com.