The bargain chain opened in the old BHS store in the Mander Centre last week and bosses have requested to sell alcohol seven days a week between 7am and 11pm.
But councillors have listed their concerns which are due to be discussed in depth at a meeting next week.
Members are worried that granting the licence might lead to an increased risk of disorder, anti-social behaviour and children buying alcohol.
They have suggested that the hours of sale be reduced to 8.30am to 8pm, with no single can sales of lager, beer or cider.
A full-time security guard should also be employed at the store in Dudley Street, members have asked.
A spokesman for B&M said: “B&M is prepared to modify its application to take account of some of the very valid concerns raised.
"It is prepared to modify its licensing hours and to add additional conditions to its licence application, in order to ensure that granting the licence would not undermine the licensing objectives.”
As the location of the shop falls within a ‘Cumulative Impact Zone’ (CIZ) – an area considered to be at higher risk of incidents of crime or disorder taking place – the application has raised concerns from both public health and licensing officials.
Wolverhampton Council’s principal public health specialist, Parpinder Singh, said: “Our department objects to this application on the basis that the premises falls within a CIZ.
“Therefore, it undermines the licensing objectives surrounding the prevention of crime, disorder and public nuisance.
"It is also the opinion of the Public Health department that the applicant has not provided us with enough evidence that will offset the presumption that this will be refused.”
Wolverhampton Council’s section leader for licensing, Elaine Moreton, said: “This application is for the sale and supply of alcohol off the premises between 7am and 11pm, Monday to Sunday.
“This raises a number of concerns for the Licensing Authority purely because the premises is situated within an area where a Public Space Protection Order is in place.
“A number of generalised conditions have been suggested by the applicant’s solicitor, but really these do not address the concerns we have regarding any additional incidents of alcohol-related anti-social behaviour taking place within the area.
“As a result we would require further clarity with regard to the shop’s operating schedule in order to justify why this application should not be granted in the first place,” she added.
B&M stores sell everything from household goods, wallpaper, curtains, furniture and toys to food and drink.
Wolverhampton Council’s statutory licensing sub-committee is set to make a decision on the application next Wednesday.