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  1. #1
    gmaske's Avatar
    gmaske is offline Senior Member
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    Gun Business Questions

    Does anybody here sell guns for his day job? I've got a unique opportunity and have a bunch of questions. The first would be how do you go about getting a FFL?

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  3. #2
    Baldy's Avatar
    Baldy is offline Senior Member
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    Here's the BATmens home page. You will have to go up there and start reading up on what you have to do. To much to try tell in a forum.
    http://www.atf.treas.gov/index.htm

  4. #3
    gmaske's Avatar
    gmaske is offline Senior Member
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    Thanks for the link. Here's the deal.....There is no active comercial FFL with in aprox. 50 miles of me. That encompasses four fairly good sized upscale towns. I'm trying to figure out a way to capitalize on this in some way. I don't think a "Gun Shop" would be profitable but there must be some way to make a nice side income off of this situation by maybe doing a custom ordering service of some type or other with some kind of regular add running in the right media. A store front would be kinda fun but I don't think I could move enough stuff to make a living at it unless I offered other sporting goods. The trouble with that is I'd have to compete with a large retailer near by that doesn't carry guns or ammo. I just don't know what I might be getting myself in to here as far as overhead and stuff. I guess it's one of those things that pops into your head when you see a hole somewere. I'd like to explore it some before I just blow it off as another hair brained half baked idea.

  5. #4
    Steve M1911A1's Avatar
    Steve M1911A1 is online now Senior Member
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    The markup on guns is horrible. If you take in 30% gross profit on a sale, you're doing very well. "Normal" retail-goods businesses should take in 100% gross. (Your operating expenses, advertising, rent, and your salary all come out of that gross profit.)
    I gave up my FFL because BATFE had embarked upon a campaign to eliminate "kitchen table" gun shops. At first, mine wasn't run out of my home, because I already had a leathersmithing business with a real business address. But when I retired from that I kept my FFL and worked out of my garage workshop, and finally they came after me. Nicely, I must say.
    At that point, mine really was a hobby business with slow turnover. With the FFL rising from $30.00 to $300.00, it really didn't pay to stay in business anyway, so I didn't fight it.
    You will need a business address. Figure the separate rent, phone, utilities, and so on, into your calculations. You'll have to sell a lot of guns, or a lot of accessories (at a higher markup), to stay in business.
    Good luck.

  6. #5
    Mike Barham's Avatar
    Mike Barham is offline Senior Member
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    Steve is on the money, especially with having a storefront. A lot of companies won't even deal with you without a brick-and-mortar storefront and a Yellow Pages ad. Less than that, unless you have a tremendous online presence, and you'll basically be looked at as a risky (for credit terms) fly-by-night operation.

    Steve is also correct on the margins on guns. Accessories are generally more profitable than the guns themselves, so be prepared to invest in a lot of them.

    Also remember that most small businesses fail due to undercapitalization.
    Employed by Galco Gunleather - www.galcogunleather.com / Veteran OEF VIII

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    All opinions, particularly those involving politics and Glocks, are mine and not Galco's.

  7. #6
    Dsig1's Avatar
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    Also, your wholesale costs from manufacturers will be based on the amount of product you move, thus affecting margin. If you are net savvy, and can develop a presence on the online sites, you can increase your volume but with even narrower margins. One dealer in PA is the #5 seller on Gunbroker.com and his margins were in the 12% to 16% range but it added enough volume to reduce his wholesale costs so margin improved. He also sells high volume some lesser known/popular brands such as FN. The real margin is on trade in and resale. That is the opportunity at much larger margins. The guy who buys a $275 Bersa 380 (16% margin) for a first gun and starts going to the range and in a few months wants to trade it for a Glock 19 $525. You buy back the Bersa for $125, sell the Glock (16% margin) and resell the Bersa for $230 (84% margin).

    I would advise doing a lot of local market research via word of mouth. Are there any local ranges? If so, go there and ask questions. If not, that may be the reason for the lack of a local gun shop. No place to shoot so product doesn't move. Go to the local sherriff's offices and discuss it with them. They will know how many CCW permits are issued and may have registry records where you could get a feel for volume in the area without receiving confidential info.

    Good luck on this. Make sure to do your homework though.

  8. #7
    gmaske's Avatar
    gmaske is offline Senior Member
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    You guys paint a discourging picture. Looks like unless I'm very motivated and lucky it might turn into a money pit. I've got a local public range that is less than 10 minutes from my house. I live on the western slope of the Colorado Rockies so per capita there is a higher than normal interest in shooting and hunting. I'm gonna keep this idea alive for a bit and do some snooping around on the subject. The only place that sells Rifles in my area is Walmart. This place would seem to be prime for a full service gun shop. Trouble is I have zero experience in the retail industry.

    Steve, You said they came after you.....in what way other than the FFL increase?

  9. #8
    Gunerd Guest
    The BS of red tape and the atf will make ya drop it like a hot tater. Small time dealers are going by the way side of mom &pop stores. Every year there are less and less. Find a new vocation or hobby.

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