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AR-15 Private Label
7.62x39Lover
Member Posts: 3,939 ✭✭✭
A mighty fine member of this forum has suggested that an alternative to opening a factory would be to have a manufacturer build me a line of rifles. Perhaps I would assemble them?
Can any of you guys offer some insight on how that would work? How much it would cost. Who could do it. I'm guessing Del-ton.
How much money can a guy make per rifle on something like this?
Minimum orders, etc.
Can any of you guys offer some insight on how that would work? How much it would cost. Who could do it. I'm guessing Del-ton.
How much money can a guy make per rifle on something like this?
Minimum orders, etc.
Comments
Sounds like doing a cannon ball off the high board into a pool with people already standing shoulder to shoulder.
About 15 years ago I tried to get my company to make special AR-15 plastic parts (add on). There were few in the market and we could have made a good profit (30-60%), but now everyone is making add-on parts and there's no profit in it. Same for the AR-15 model guns at this point in time. To many builders and to few buyers.
Spend some time costing out the assembly (many, many suppliers available for parts) and it will become evident "if" you should do this.
A mighty fine member of this forum has suggested that an alternative to opening a factory would be to have a manufacturer build me a line of rifles. Perhaps I would assemble them?
I think what Mark said was that instead of buying the tooling to manufacture your own PARTS, you subcontract out that part of the process to one of the existing bigger manufacturers.
You'd still be 'building' (ie assembling) the guns and marketing them, you just wouldn't be fabricating the parts in house. Most of the small AR makers do it this way. While a few make SOME parts in house, most just assemble parts made by others.
While I suppose its *possible* for you to just stick your name on guns entirely manufactured by someone else then market them, that is a tough row to hoe. What are you offering here that is going to make people want to buy your marked up guns, vs similar ones from a dozen other makers with more established reputations?
IE if you're buying them wholesale then selling them retail at market prices, you're going to be making LESS margin then the manufacturers just selling the same guns themselves.
quote:
Can any of you guys offer some insight on how that would work? How much it would cost. Who could do it. I'm guessing Del-ton.
How much money can a guy make per rifle on something like this?
Minimum orders, etc.
See above. How it works is, you figure out exactly what you want Del Ton to do for you, you pick up the phone, and speak with the CEO of Del Ton and see if he'll do it for you, then you negotiate a price. I'm sure he'll be delighted to sell you 1000 completed guns at a nice wholesale price, if you like. Do you have a plan on how to market and distribute them? If not, I think you might need to start there! (Oh, having a manufacturing FFL probably isn't optional here, either).
I can't give you the exact numbers (since I'm not privvy to Del Tons per-gun manufacturing costs), but again, this is a pretty competitive market. I doubt they're making much more than $100-150 per rifle MAX. Highest per-gun markup is going to be on premium specialty builds. . .not Del Ton mass-produced entry level guns. . .and the individuals plunking down the big bucks for those types of guns tend to be knowledgeable and picky. IE, if you want to "last" you'd have to deliver. . .you can't "fake it".
Ultimately, if you want someone else to entirely manufacture your rifles, you can do that, but then you're basically just a retailer. IE you buy the guns wholesale, put your "label" on them then sell retail.
Unless you're adding something super-duper special to the mix here in terms of branding, I don't think this is a viable business model.
IE, you've got to add something here that will cause buyers to pick YOUR rifles over those of 15 other more well established, well known competitors. Ideally, you'll add something that will make them want to pay MORE for yours. . .and that something will have to be something that a. doesn't exist in the marketplace already, and b. isn't easily copied by a competitor. Do you have an idea of what that could be?
IE, maybe R, Lee Ermey or Jerry Miculek can get away selling their own lines of AR-15s. . .purely based on the strength of their names. . .not sure that you can. Miculek does have certain name parts he markets (eg compensators, grips, etc). But even that guy doesn't build his own guns!
You might better be in the accessory market. Although it is overcrowded, innovation would still sell.
On the other side, you can get a quality usable AR from a known manufacturer retail in the neighborhood of $600.00.
When you consider marketing, insurance, distribution, warranty costs, etc, how low would your cost of parts have to be to compete if you chose this market?
If you had started the process and been on your feet running when the Sandy Hook school shooting happened you could have been sitting pretty today.
The AR15 market is all but saturated now. This is why you're seeing brand new entry rifles for sale for less than $500. The entire rifle, not just an upper.
No room for a profit margin today.