Buying / Opening a Gun Shop

[NHKen]

I've been in the reataurant business all of my working life. My wife and I are thinking about selling the restaurant in the near future and heading south. I'm thinking about either buying or opening a gun shop in whatever locale we land in.

I know how TIGHT the margins are in a restaurant. Does anyone have any experience in the firearms business?
Any hints or advice for me?
Thanks!

 

[zzzippper]

I'm no business major and have no experience but I can't imagine two more risky ventures.

 

[wbraswell]

I admire your thought, but I just wouldn't want to risk that much with a business that so many politicians want to shut down.

 

[weatherby]

I'd ask do you know a lot about guns,ammo,accesories etc and gun values ahead of time ?

All I can say is the learning curve if not would be very steep

 

[Gunslinger808]

How do you make a Million in the gun business?
Start with Two.

Owner of two gun shops here, One in Mesa, One in Florence.
Your profit comes from accessories, not so much the firearms sold.
For every dollar made on a firearm, you'll make Five on optics, ammo, and other gear.
I'm also a dealer in NFA items and work quite a bit with the LEO community, so I've sort of got an edge.
Also, you really need to learn your clientel.
Do they want "tactical" stuff, will you cater more towards the hunting crowd, offer gunsmithing services, on and on.

You think you deal with needy, greedy, and obnoxious types in the restraunt industry, just wait till you come over to the dark side.

The biggest thing to me is, KNOW YOUR PRODUCT.
If you are not familiar with everything you sell you are at a disadvantage.
If you sell AR15 type rifles, you need to know the differences that barrel length and twist rates make.
If you sell handguns, be prepared to be able to explain the difference on grip angles between Glock and the XDm.
You'll need to know how to take apart and clean every firearm in inventory, and explain it all to a novice or talk at length about it to the knowledgable.

It's really not something you can just throw money at and expect to see a profit.
Just like the restraunt industry, it's all about knowing what you sell and presentation.
Otherwise you're setting yourself up for failure.

 

[Mcwsky09]

How do you make a Million in the gun business?
Start with Two.

Owner of two gun shops here, One in Mesa, One in Florence.
Your profit comes from accessories, not so much the firearms sold.
For every dollar made on a firearm, you'll make Five on optics, ammo, and other gear.
I'm also a dealer in NFA items and work quite a bit with the LEO community, so I've sort of got an edge.
Also, you really need to learn your clientel.
Do they want "tactical" stuff, will you cater more towards the hunting crowd, offer gunsmithing services, on and on.

You think you deal with needy, greedy, and obnoxious types in the restraunt industry, just wait till you come over to the dark side.

The biggest thing to me is, KNOW YOUR PRODUCT.
If you are not familiar with everything you sell you are at a disadvantage.
If you sell AR15 type rifles, you need to know the differences that barrel length and twist rates make.
If you sell handguns, be prepared to be able to explain the difference on grip angles between Glock and the XDm.
You'll need to know how to take apart and clean every firearm in inventory, and explain it all to a novice or talk at length about it to the knowledgable.

It's really not something you can just throw money at and expect to see a profit.
Just like the restraunt industry, it's all about knowing what you sell and presentation.
Otherwise you're setting yourself up for failure.

Excellent advice.
I know a few folks who have been small business owners and some of the biggest challenges they have had was dealing with employees - especially part-time vs full-time etc. Since you have already run a (presumably) successful business I would imagine you have at least some idea how to handle the challenges of personnel and doing the books etc.
I wonder if it wouldn't be beneficial to get a job in an established gun store and see how things work from the inside first. Or find one owned by someone who may be looking to retire in a couple years with no heirs willing or able to take it over and take it on as an apprenticeship short of deal.

 

[NHKen]

Excellant points....and an excellant idea Mcwsky09...
Yes, I deal with anywhere from 12-40 employees depending on the season - it's always a huge challenge. Great discussion!

 

[Gunslinger808]

I wonder if it wouldn't be beneficial to get a job in an established gun store and see how things work from the inside first.

This would be an excellent option.
It'd be a great way to gain the insight you'd need to run a shop of your own.
One thing I can't over emphasize is to learn the forms used, and also the laws of the state you want to open in.
Federal laws are pretty consistent, but state laws all vary.
What's right for Arizona may not fly in Colorado.

 

[Rastoff]

Gunslinger808 said it best. One of the best ways to go broke is to open a gun store.

He's right, the margins on guns are tiny. Most dealers around here are making about 15% on guns. That's not enough to keep the doors open. Then, if you set your markup at 20%, people will complain how you're trying to jack the prices up on them.

Of course, none of this is news to you. Inventory costs money. In the restaurant business, excess inventory goes bad. In the retail business, excess inventory takes space. The trick is learning what your clientele base wants.

I want to try a new concept in a gun store. I want to open a retail store, but not carry any guns. Do transfers only. This way a customer can shop on line and just have the gun sent in and I'd do the transfer. This will save on inventory and eliminate the problem of some gun sitting unsold for years.

Then, sell accessories, apparel, ammo and so forth which offer up more profit potential.

 

[gdnagle]

Had a buddy years ago that owned a gun shop. He made his money buying and selling used firearms and fishing equipment. You need to be aware that there are high B&E rates at least for him. He had to go to his shop at least 3 times a week. Of course his shop was rural without many neighbors. Plus everything Gunslinger808 said. You also need to have a backup business in case your ever shut down. Also like Rastoff said with the amount of online firearm sales and their lower prices it's almost like you can't compete but you can still make money on transfers. Plenty of insurance just in case and excellent security with cameras is also good to have. Don't think it could never happen to you. The next shortage would probably put you out of business without a backup plan. Maybe a indoor range with your shop could also help. Good Luck.

 

[Trooperdan]

I spoke with the owner of a large gun store with an indoor range and he told me if he depended on profit from gun sales he would go broke.. said the range was his profit center.

 

[b_san]

How about a restaurant WITH a gun store...

 

[Dezfan]

Sir, would you like fries with that semi auto pistol?

 

[pharmer]

People always need to eat. They don't all need or buy guns. The retail gun business has improved as a result of elimination of 3/4 of the FFL's but the internet tells everybody just what price people are paying for anything. Joe Joe

 

[Jessie]

I've thought about doing it myself. Not after this pep talk though.
We need more gun stores not less. Any business is tough to start as you probably know already.
The best advice I've heard was Know your products!!
The idea of working at a gun store for a while is sound.
Don't be discouraged.

 

[the ringo kid]

Ive nothing intelligent to add but, having food and entertainment available--sounds like a good angle to me.

 

[Kanewpadle]

Couple of thoughts come to mind. How old are you? I definitely would not open a gun shop if I was middle aged unless I had DEEP pockets.

And you mention relocating. I highly suggest researching the guns laws in the city AND state you will consider moving to. Not all laws are the same. Some are very restrictive.

A gun shop with an indoor range would be ideal. However in warm weather the range will slow down.

Unfortunately privately owned gun shops are taking a beating from the internet and big box stores. I have never bought a gun from the internet or big box stores. Never will either. I want the mom and pop gun stores to survive. More gun shops means more to choose from at competitive prices.

As far as gun sales are concerned, customer loyalty is almost non existent.

If you're making good money now, stay where your at.

 

[redneckemt]

How about a restaurant WITH a gun store...

Used to be one on I24 in Tennessee. You walked in the front door turn left and there were guns. Turn right and have a seat. The gunstore is now on both sides now. They made more money selling guns than food.

Reminds me I need to go to the Outpost.

 

[Marine Corps Air]

1. The doors are always open in the Great State of Georgia. We're still "firearm friendly" here!

1. Gunslinger808 and Mcwsky09 are right on target! Great advice.

My advice:

a. Find your niche (market need) and fill it. You can't be all things to all people. You'll go out of business trying.

b. Visit as many gun shops and ranges as you can. Find out all that you can about the business, what works, and what doesn't.

c. If possible, work in a LGS or at a gun range for 6-12 months before you decide where to locate and when to open your doors. . You won't be able to buy a better education anywhere.

d. Find and hire an experienced accountant or CPA. They can be outstanding business advisors. Always keep and maintain current, accurate business records.

e. Focus on customer service. It's a lost art in America. It's the repeat Customers that will drive up your profits. They'll also tell their gun-buying friends and gun collectors.

f. Hire one or two knowledgeable, honest people who know guns, accessories, hunting, etc who will work hard for you behind the counter. Customers go to gun shops where they can obtain important firearm information before they buy.

g. Know all of the laws that govern your business - Federal, BATF, state, and local.

h. Build a network with other business owners. You'll never know it all, but you'll have colleagues who will assist you in solving your business and financial problems.

I. Cash is king! Always, always keep your eye on the cash coming in, and the cash going out!

 

[diamonback68]

Open a combination gun shop and hotdog stand.

Customer #1
"Thank you for purchasing your new Smith&Wesson sir, while you're here, how about trying one of our delicious hotdog."

Customer #2
"Enjoying your delicious hotdog sir, let me show you this latest S&W semi-auto we just got in?"

Best of both worlds.