Why are gun stores so overpriced?


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Alex45ACP
April 24, 2005, 02:38 PM
All the gun stores in my area charge way too much. How do these places manage to stay in business when their products are so overpriced?

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BryanP
April 24, 2005, 02:38 PM
Overpriced compared to what, exactly?

DontBurnMyFlag
April 24, 2005, 02:47 PM
actually according to the MSRP on websites, gun stores are nicely priced. however, when compared to gunbroker, and gunsamerica and gun shows well yea gun stores are overpriced. it just depends what you compare it to.

example MSRP of beretta storm is 800+ on the website
at a gun show it was 500 brand new
on gunbroker 480
at my gunshop 600

albanian
April 24, 2005, 02:54 PM
I think I know what you mean. Internet is always going to much lower than a brick and motar store and sometimes gunshows have better prices than local stores. I have found that some stores are basically good places to spend my money and others are basically rip off joints. Even the good stores will sometimes have outrageous prices on certain items.

I have a local favorite that sells used handguns (which is my personal cup of tea) for very good prices. They charge insane prices for some other things like ammo and holsters. They have good prices on used shotgun bbls and new stocks and grips so as long as you know what they are charging way too much for, you can still shop there and be happy. If they only charged a little too much for the ammo, I would buy it there but the prices they ask, it is cheaper by far to just order from Natchez and pay shipping. I mean it is like half the cost.

There is one gunstore that everthing they sell is as MSRP or above. It is the largest store in town so they must be selling to someone but I don't buy from them anymore. Every once in a while I will see something there that I want and I buy it but later I found I got ripped off. It sucks because it is the closest store and the biggest so I like to stop by once in a while at least just to look.

MikeIsaj
April 24, 2005, 02:59 PM
I'm going to assume you mean compared to gun shows or the big box, mega we don't care about you beyond your wallet chain stores.

A gun shop is by nature a small business specialty shop. As such they cannot begin to compete with the big stores in purchasing power or overhead costs. There is an economy that dictates when you by ten thousand of something, you get a better price than when you buy 200 of something. If you get it cheaper, you can sell it cheaper. Then there's insurance and other overhead costs that also get cheaper when you do things on a large scale. Most utilities provide electrical service at a different rate to a large building than they will to a small store or to a residence. They do this because they can provide a different product that is cheaper for them to produce and distribute to a large building.

Remember when comparing prices at different stores, also compare the service. I buy weapons exclusively at gun shops. I do this because the extra money paid is worth the extra service and general expertise found at the small business. As I've said before, I consider the extra dollar or two I pay for ammo at my local gun shop a fair trade for all the free advice I get.

Werewolf
April 24, 2005, 03:01 PM
Hmmmm...
Guess it depends on where you live. With one exception all the gunstores in OKC have prices that run 70 to 75 percent of MSRP and that beats online site prices (especially after you add transfer fees and shipping) by a huge margin.

Gunstore prices here aren't overpriced and from what I've seen gunstore prices in Dallas are even cheaper than here in OKC.

mustanger98
April 24, 2005, 03:09 PM
The gun shop I deal with now prices their guns $15 over wholesale. If they special order one, and they have more me three times in the last year and a half, they go wholesale + $15 + $12shipping + sales tax. And it's cheaper than that caveat emptorium I quit going to three years ago.

Zach S
April 24, 2005, 03:21 PM
I think the one I frequent is 10% over cost, minus shipping. Pricing is decent IMO, pretty darn good compared to one pawn shop in particular that had a beat up G36 tagged for $600...

IME most of the guys that ask too much are open to haggling (me for example - well, not for guns, I dont sell them), and guys with competitive prices are pretty firm. Of course, there always exceptions.

redneck2
April 24, 2005, 03:24 PM
if you think it's so profitable, start your own shop and you too can make the BIG MONEY...yes, you can

hire employees
pay wages
pay property taxes
pay sales taxes
pay employee (FICA) taxes
pay liability insurance
pay utilities
pay mortgage payments

and best of all, have $500,000 tied up in inventory...

then have customers come in, handle a new $2,000 Browning shotgun and whack it against the counter and gouge the stock...so that the next customer can work you over on the price

or special order stuff that customers never pick up

or stock stuff that costs you more than Wal-Mart sells it for. Neat thing is, the customers buy stuff at Wally World because you're the "rip off artist", then expect you to fix it because the guy behind the counter at Wal-Mart worked in the housewares section last week and lawn & garden the week before

or have shoplifters come in and steal you blind because you're rich (after all, you own a store)

and you get to do all this while only working 80 hours a week

the real answer is that Wal-Mart sells cheap by short-changing their suppliers. Sell to Wal-Mart and you might get paid...partially..after 90-120 days. Oh, not getting paid??? Take them to court...yeah Why do you think you almost never find the same thing in Wal-Mart twice in a row???

Go to Wal-Mart and look at the nice Colt and Kimber pistols...oh wait, they don't have any. Well, at least you can look thru the used guns...oh wait, they don't take trades. Well, just look at the Leupold scopes. Oops, none of those. Try to get your new rifle bore sighted. The clerk will just look at you like you've got two heads.

Dude..Wal-Mart sells junk to hillbillies.

Majic
April 24, 2005, 03:28 PM
All the gun stores in my area charge way too much.
What do you think they should be charging and why?

lee n. field
April 24, 2005, 03:43 PM
Cost of doing business. Out of gross profit the gun dealer needs to pay for his building, insurance, employees' pay and expenses, advertising, etc.

sm
April 24, 2005, 03:49 PM
Fellow walks into a Auto Parts Store. "How much for a carburetor" he asks the Parts fella .

$15

"Fifteen bucks!, Well the Parts Store down the way says they only charge $12".

Go buy it from the other Parts Store

"They are out".

Yeah well - I quote $12 when I am out also...

Larry Ashcraft
April 24, 2005, 04:01 PM
MSRP on a Henry Golden Boy is $409 (IIRC)

Dead dealer's cost with shipping to Colorado: $300.

Gun store price: $359.

To me, a 20% markup is way too low. I don't know how they do it.

Actually, I do. Gun stores make their money on accessories and ammo, not guns.

marshall3
April 24, 2005, 04:11 PM
Don't buy ammo or anything at WalMart etc. Support your local gun shop. They aren't getting rich, and we need these guys!
PS: I don't have a shop, neither do my relatives! :)

redneck2
April 24, 2005, 04:32 PM
Perhaps my above rant seems excessive. I worked in a gun shop part-time a few years ago

If you'd give me that shop with the stipulation I had to work it like (as hard as) the current owner for the next 10 years, I wouldn't take it for free

Edmond
April 24, 2005, 05:23 PM
In my Chicagoland area, the gun shops are at least 25% of what the online places sell for. Their accessories are also expensive as well. I called to ask about some nite sites for a P229 and this one place wanted $120 + an installation fee!

I find the sites online for $65. Who do I buy from?

I found an FFL who does transfers for $20.

Even asking the local shops to do a transfer will get you nowhere. Some shops want $50 or 20%, whichever is greater and others want to charge you sales tax.

Art Eatman
April 24, 2005, 05:34 PM
The owner of a small gun store might well be married and have a couple of kids. The Gummint says he's in poverty if his gross income is less than (roughly) $25K a year.

That's $25K net/net/net after all store overhead. Near-poverty.

Say he has an inventory that's cost him a half-mil to build up. That's not all that hard to do if you've been in the business for any length of time.

At least one clerk: $20K or more. Rent, $12K or more. Utilities, $5,000 a year, maybe. Phones/computer/FAX costs. Accountant. Insurance? Aside from liability, at least $1,000/yr premium. Liability? Maybe another $1,000? And, possibly, the cost of a line of credit for operating capital from his friendly banker.

So he absolutely must make an average of somewhere around 25% on the overall sales, minimum, just to keep the doors open and eat better than poverty level.

And that's just a quickie rundown of numbers I've seen for various small businesses; I don't even pretend it's exact.

Could be worse. He might have gone into the jewelry bidness.

:), Art

Kamicosmos
April 24, 2005, 05:41 PM
I trend I have noticed at the shops in my area is that everything is tagged with full retail price.

You have to haggle, which I hate doing. But, I assume that they make some easy sales where someone comes in and just pays the full tag price.

Also, the big stores (Cabela's specifically) has everything tagged at full retail, and they WILL NOT come down at all.

I try to buy from my local guys whenever I can. It's hard with cabela's having everything under the sun, especially reloading stuff, but I do give my guys a chance.

Old Fuff
April 24, 2005, 06:00 PM
A lot of people believe that if a dealer (no matter what kind) sells a gun for say $800.00, that's what he gets too keep, and he's made a lot of easy money. Not too many working guys take home $$$ like that, or so they think ...

But that money doesn't all go into the dealer's pocket. He had to buy the gun in the first place, and depending on where he is and what the competition is he can expect to make anywhere from 10% ($80.00) to 30% ($240.00). Now this may look like big money to a working stiff, but he forgets that isn't all money in the dealer's pocket. He still has to pay for all of the costs of doing business (called "overhead") so he'll be lucky to take home maybe 1/4 of the total profit ($20.00 to $60.00) from that $800.00 sale - and it's unlikely he makes very many of those in a given day.

So there isn't a whole lot left to support himself and his family. That's why in some areas it's getting harder and harder to find a local dealer, and as competition goes the prices at the remaining shops usually goes up.

MikeB
April 24, 2005, 06:14 PM
I never won the lottery, but I guess all my luck went into having really good gunshops around. I can very rarely find a better deal online or anywhere else than I can at two or three different local FFL's. I don't recall ever paying anything close to a MSRP; of course I do buy a lot of those fired once handcannons. I also usually check pricing on gunbroker, gunsamerica and the like for anything I'm interested in and invariably the local FFL's have a better deal.

Of course I suppose buying a lot of guns from them helps a bit with the pricing too.

Standing Wolf
April 24, 2005, 06:18 PM
What's really needed is a great deal more competition to push prices down and selections up. The only way to get more competition is to get lots more people to take up shooting.

Monkeyleg
April 24, 2005, 06:50 PM
My friend owns a couple of businesses, one of which is a gun store. He tries to get 17% over his cost on a gun. His markup at his furniture store is just about 100%.

At the gun store he has three full-time employees who make $30K-$40K or more a year.

He also has a range with a super air recirculation system. It costs him an incredible amount of money just to turn it on.

He probably has one of the best selections of Ed Brown pistols in the country, but that means he has a lot in the way of carrying costs to have them.

The shops with no selection who say they'll order anything can sell for a lot less than a shop that has a great selection.

You can have price or selection, but usually not both.

mustanger98
April 24, 2005, 07:01 PM
The caveat emptorium I mentioned that I quit doing business with- they had a big selection, but when I tried getting them to order something they wouldn't do it. The manager would say he would, then I'd go a while asking has it come in yet- and I'm talking about after a week or two I'd start asking. After about six months of waiting, the manager finally said he didn't order it. I don't know about ya'll, but I get tired of being messed with like that. Otherwise, after all the money I'd spent with them on the stuff I do like, and I guess it's because they couldn't sell me stuff I don't like, they got to where dealing with them was like dealing with a caveman and a used car salesman. I never recommend them to anybody.

The shop I go now- they don't get into milsurps, but they told me if I want to order it, they'll recieve it and won't charge me to do the transfer. :cool: I let 'em know when I see where they beat the competition's prices too, because if they can keep on underselling the competition, I can keep on telling folks they got lower prices. They know that. When I recommend, I recommend this shop.

Husker1911
April 24, 2005, 08:25 PM
Edmund "Even asking the local shops to do a transfer will get you nowhere. Some shops want $50 or 20%, whichever is greater and others want to charge you sales tax."

In my state, a shop is required to charge sales tax. A legitimate shop, that obeys the rules and pays their taxes. Yes, it's true many basement or part-time dealers will fudge on the tax. That's their perrogative, should they choose to deliberately break the law. But to criticize a shop for obeying the law seems pretty lame. Seems like you're cursed if you do (by some customers or posters) and cursed if you don't (by the state whenever you get caught).

No_Brakes23
April 24, 2005, 08:39 PM
Well, just look at the Leupold scopes. Oops, none of those.
I saw a Leopold at Wal-Mart just the other day.

Just sayin...

JohnBT
April 24, 2005, 09:29 PM
I haven't been in a Wal-Mart five times in my life, but I drove through a little town Thursday and there it was on the side of the road and I needed a break. I went in to see if they had any 28 ga. shotshells. Not only did they not have any 28 ga. that I could see, but there wasn't anybody in the working in the sporting goods department.

I guess that's how you hold down the overhead.

Me? I like seeing the gun I'm buying. Looking at guns on the net is fine, but being able to handle them is invaluable. It does lead to impulse purchases though. :)

John

mustanger98
April 24, 2005, 10:30 PM
I like seeing the gun I'm buying. Looking at guns on the net is fine, but being able to handle them is invaluable. It does lead to impulse purchases though.

Sounds like what my brother-in-law's dad said.

(exchange takes place in a gunshop)
him: "let me see that..."
dealer: ***hands him the pistol***
him: "I wish you hadn't done that"
dealer: "what?"
him: "I wish you hadn't handed me this gun"
dealer: "why?"
him: " 'cause you just sold it."

My Daddy told brother-in-law's dad that sounded like me. :uhoh: :neener: :uhoh:

Alex45ACP
April 24, 2005, 10:45 PM
I understand they have to stay in business, but come on. When they're charging $650 for a G17, that's a little ridiculous.

Boss Spearman
April 24, 2005, 11:10 PM
I have yet to pay the MSRP listed on the manufacturer's website for any new firearm.
The shops I've gone to have always been lower than the listed MSRP.

Commissar Gribb
April 24, 2005, 11:49 PM
the shop around here is a total rip off. Practically armed robbery. He sold my friend a 91/44 mosin nagant for $160 back when he didnt know what a bad deal was.

this mosin wasnt even much to look it. izhmash arsenal, chipped worn laquer finish, worn bluing...

Since I found an FFL down town that only charges $15 on a transfer, I dont go to the shop anymore.

Monkeyleg
April 24, 2005, 11:51 PM
Alex45ACP, that price is indeed high. A G17 around here is just shy of $500, and the shop is getting 15-17%.

Of course, I don't know of many shops that get MSRP.

Mike128
April 25, 2005, 12:32 AM
I guess it's where you live. Before the internet the local gunstore in MD had a monopoly. I never knew how much they were ripping me off until I moved Iowa.
When I moved to Iowa for grad school. I couldn't believe my eyes. The prices on new guns where lower than used guns at my old store in MD. The people actually talked to me instead of down at me. I learned a lot about rifles and guns just BSing with the clerks, and spent a lot of money. Even the big name Scheel's store was cheaper than in MD.
Now that I'm back in MD I can't even go into the local store. Some guns are above MSRP "because it costs extra to ship onto this side of the Bay". The transfer fee are $65 for long guns. 140gr Accubonds cost $25 a box. A used Kimber Varmit ($1100) cost more than a new one did in Iowa. No haggling allowed. "This is my price, take it or leave it." I ask you, why should I go to this store? I like to keep money local and in small business but there is a limit.
Thankfully, there is a new store that opened. They know my name and take care of me. When I do a transfer they don't even charge me because I buy so much other stuff. It's normally $30. That is the store that gets my money.

Beav
April 25, 2005, 11:08 AM
I was quoted $900+ for a Remington 700P at one of the local shops here. I will never buy a firearm from them. The next shop quoted me $800 for a 700P but could only offer it in .223. I had to explain to them what a 700P was for christ sakes. The last shop needed time to get a price since they thought it was an LEO rifle. They called me back to let me know they were still looking but that was it. When I went there to pick up my new rifle they had a 700P for sale!

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