Average Profit

7.62x39Lover

Hi guys,

I am in the process of writing a business plan in order to seek capital for a gun store. I would like to know, how much profit do retailers make on handguns and rifles on average. As well as the higher end profits and lower end profits on various models.

allamericangunshop

OK ,
You may want to watch this closely :
You will get accused of begging for money as well as all kinds of misguided info and responses ???
Now :
to try and give an answer to the questions at hand :
New Guns : Its tough and for us hard sellers @ MSPR and not much money to be had on some items : and yet on a few really hot items , MSRP can be had , and for some unscroupeless (?) dealers its MSRP PLUS ???
We make and average ( on new guns ) between $35 and $65 each profit ?
and on Used Guns : Smoe items are much better than others ??? on an average we can double ( and sometimes triple ) our money ??? Either taken in on trade ( a learned adventure ) or bought outright ( bulk or numerous items deals are much better ) !
Other items ( cleaning kits , holsters , ect , ect ) are a toss up ,
Maybe MSRP on an average !
Ammo : Thats a different ballgame right now , MSRP at least , but be causious that you dont get the rep. for 'price gouging' !!!!!!!
Figure your overhead : rent , insurance , utilitys , supplies , ect.ect. and plan on MORE and hope for the best !
and :
By the way , if you have ( or find ) a way to reasonably raise the capital ? Please let me know : Im looking to expand my shop ???
Thanks & Good Luck !!!
d.a.stearns ............. a.k.a. ......... SKEEZIX .................
Gunsmith / LEO / Instructor
Athens , Tn














... www.allamericangunshop.com
... www.tnhandgunclasses.vpweb.com
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mark christian

The real money is made on used guns, consignments and accessories. Unless you plan to operate a major firearms store I advise against laying in a large stock of new firearms; put in enough of the popular guns so that folks have something to look at and then simply offer to order an item for the buyer. Before the newest wave of panic buying rolled in dealers were lucky to squeeze 5%-8% out of new gun sales so keep that in mind when things finally settle back down. The real money makers are little items like blister packs of bore brushes or cleaning patches which sell for a couple of bucks but you pay under a dollar for in bulk. While that does not seem like much it actually represents a 100% profit margin for an item which everyone needs and takes up virtually zero floor space. There is a lot to running a gun store, much more than the typically firearms enthusiast imagines. My friend Ron and I both spent several years working at a large gun store before we opened our own shop and we make a success of the business for twenty years before we decided to call it quits, take the money and retire at ages 45 (age 44 for Ron). I suggest that you either work part time in a gun store for a year or hire someone to manage your business who has several years of experience before you plunk down your money.

GONESHOOTING

stock up on the most popular ones that are selling, you want the impulse buyers. If they have to order, may go somewhere else and you may lose a sale. Owning a gun shop has got to be very expensive.

CS8161

10-15% on new....30-40% on used if bought correctly.

M1A762

As stated, the profit margin on new firearms is small. Big box stores get the preference from the wholesalers, so forget about having the current hot or trendy new guns in stock.

Used and accessories is where the potential for profit is.

There is another side to the business. If you are not able to accurately record who you buy guns from and who you sell them to there will be problems. The ATF will audit you eventually. Your records must be accurate and organized.

Your business plan should probably include the process of obtaining the FFL first. Everything hinges on being able to secure the FFL. You must have local, maybe county and state approval to open a firearms business before even applying for an FFL.

Good luck with your business.[:)]

toad67

In todays market the little fish don't * much of a chance at buying the good stuff. LGS has a hard time getting much of the higher demand items. He orders stuff all the time and moswt of it shows up 6-8 months later.

7.62x39Lover

Thanks alot for the info. You guys are always a wealth of knowledge. I am far from bringing anything to fruition right now, but I am gathering info. so that I can put together a good business plan. Thanks again.

11b6r

As part of your overhead, do not forget TAXES (it was the IRS that took down Al Capone) You may have income tax, sales tax, inventory tax, and property tax. Would strongly suggest that (a) you incorporate, and (b) find a good accounting advisor.

drsck

Several years ago I did just what you are doing. I had worked for more than 30 years in gun shops and sporting goods stores and thought it might be the way to go. However... I had just closed the doors on the last of three large retail sporting goods companies that I had worked for and was a little hesitant. So, I took a tour around the country asking other gun shop owners what they thought and what advice they had to offer. In a three week period I visited more than 300 gun shops from Maine to Kansas. All of them, with one exception told me the same thing -- DON'T DO IT!!!! The one exception was a wonderful guy in upstate New York who had been in business for several years. When I asked him if he'd do it all over in the market at that time, he said "yes-provided that the shop had both a trained and experience gunsmith on hand and a range, preferably both indoors and outdoors as he had. I went home and thought this all over, did the numbers using different percentages of profit ranging from 4% to 15% and came to conclusion that it just wasn't economically possible. For example, if you're doing an average of 10% profit (which is a high "average" in my experience), just to keep the lights, the doors open, the insurance paid and are renting a modest storefront, you will have to sell at least $100,000 in merchandise every month. Know many shops that can honestly say they do that? Well, I worked in a place that did, once upon a time, and even that wasn't enough. They went broke. Oh, and the one fellow who encouraged me to go ahead, his name was Turnbull--the father of Doug Turnbull, and he went out of business within 5 years. Best of luck.