Do's and don'ts of running a gunshop?

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Investors won't put out their money or loans for a business returning such a low profit margin. $200 profit on an $800 item nets a mere 20% margin.

Volume makes a huge difference. Its not a direct parrallell but after overhead the profit margin in most grocery stores hovers around the 1% mark. Of course they sell a massive volume of products, they also make a fortune. Selling more stuff for less is often a better option than selling less for more. Of course guns will never be a high volume business because the market is limited. A lot of people own very few guns, even more own none at all. On of the big problems is that guns are too well made and those who own very few of them probably wont ever need them to be replaced.
 
One humble suggestion: ensure that the writing on the tags of long guns stored in vertical racks behind the counter is visible to those on the customer side of the counter.

I can understand not wanting situations in which every customer that walks through the door paws the merchandise, but I hate those places that can't bother to make the writing legible (i.e., dark enough, large enough, etc.) across the short distance of the counter. Magic markers are wonderful things - please use them. Not everybody has 'super-eagle-sniper vision' and can see your scrawled notation in pencil on a tiny tag hanging behind the rifle. :scrutiny:
 
Well, I've already bashed what I don't like in this thread, so this time, I'll describe what I like.


There's 2 gunshops in my area that I give my business to. Both of them are "moonlighters" and open from late afternoon to evening. Both shops are simple, but have good stuff. No money wasted on flashy decoration. Prices are good. Not internet great, but good enough to where I will not complain about buying. Both do transfers for $20 or less. This is compared to the rapist gunshops with outrageous prices that charge $50-$100 for a transfer.


They are a little weird, but nothing extreme. Friendly overall. BY FAR the most knowledgable about firearms. They know more about firearms than I do - I like that. I hate being in a shop where I know more than the guy working there, because THEY are often the ones to say something stupid about some type of firearm during their sales pitch.


I like shops that deal. ALL of the time, the dealer is higher in price than the internet, but if they merely show me that they'll come down in price, and come close to being reasonable to the net prices..I'll buy from them, since they are local and I had an opportunity to handle the item in person. Like the above poster's Trijicon story. I'll pay $100 more than internet price for that because of the customer service, but I won't pay $300 more. It varies from item to item how much more I'm willing to pay for CS or for quick gratification. When it comes to pistols, if they dealer can come within $30 of my cost to buy online (and they have a few rare times), ship and transfer, I'll buy it from him instead. I will not pay $100-$130 more for that pistol though. I'll go through the trouble to buy online and ship and transfer. $130 is a lot of money, buys me a case of ammo or a nice dinner with my woman.


Major dislike:

Shops or Ranges that have "no concealed weapons or loaded firearms allowed" signs are absolutely out of line imo, and deserve not a single red cent of my money. We have threads here to boycott restaurants and other businesses that are anti-concealedcarry, yet there's an aweful lot of shops/ranges that have the same exact policy.
 
I've traded 2 guns before and didn't get 50% of sales price on trade on either one.

The 2nd deal I think I got screwed royally, but went ahead with it anyway because I was in a hurry. My loss. Here are the specifics:

Traded a $900 MSRP rifle wearing a $700 MSRP scope. No scratches, mint condition. Was offered $650 on trade for a $800 MSRP rifle marked at $1050. Bought a $400 scope and asked if the price was firm. Was offered 10%. Ok, no problem there. But after the screwing on the rifle it didn't make me feel better. Maybe I should have said "No thank you". Probably should have.

Nevertheless, I've not been back. Will not go back either. I'm a person of habit. When you sell to me, you have the opportunity to get my lifetime business. The way you deal with me on my first visit will determine if there will be a 2nd.

The place I'm buying from now is run by 2 gentlemen. 1 is an elderly man who grins every time someone walks in. The other is his son who doesn't smile much but will show me whatever I ask for and answer any question I ask. He is to-the-point and doesn't converse much, but that is ok. At least he is not full of BS. Both of them ask if they can help me as soon as I walk in. If I'm just looking, they let me look as long as I want without hovering over me. I'll do business with them again.
 
Rigby, DOn't take this as a slam BUT:

Your $900MSRP rifle, probibly $700 dealer cost
Your $700MSRP scope, probibly $300 dealer cost
Both are not MINT, MINT is not used, never touched by human hands. Your gear was used... even if shot once, or even taken out of the box. You don't mention the type of gear, but maybe the dealer knew that it would not move.... subtract another 10-30%.

So your $1600MSRP kit looks like $1000 best case, $700 worst case.

Plus what were you buying? A hot seller? Why deal (ie LOSE MONEY) on a gun that you can get full price for?

Selling used guns (unless rare/collectable) is rarely a winning proposition when selling to a dealer. You could have gotten more if you went with a private buyer.

Nothing you said leads anyone to belive that you were taken... you just did realize the value (or lack thereof) of your gear.
 
Well, looks like I got less than worst case scenario then.

The thing that really pissed me off was when I realized he was selling an $800 MSRP gun for $1050 + giving me worst case scenario on trade.

Like I said, I admit I could have gone elsewhere. From now on, I will.
 
DO have reasonable prices - a $200 markup on an $800 item is NOT reasonable
in most areas of the retail business, markup is 150% over cost. my first job was with a major retailer, for example we sold oakley products. store cost was $65, price tag was $130. an article of clothing that has a tag for $50 cost us $15.
the same is not necessarily true with the gun industry though. guns typically have strict MSRP, which is to be viewed as a 'maximum', not bare minimum. if a gun costs the store $800, and they sell it for $1,000., you are getting a smoking deal.

i won't divulge what the average markup is on guns, as most of you think you know what guns cost because you looked over your buddys shoulder while he had his RSR catalog open.

why is it that you 'thrifty shoppers' think a gunshop should sell you a gun marked up only enough to afford a happy meal when all is said and done?
 
i won't divulge what the average markup is on guns

I will. The info is all over the net anyway and telling them you're intentionally hiding it only makes people suspicious.

That 4" Sprindfield XD 45 (ACP) you see plastered everywhere ends up costing the dealer $455-$460 ($20 or so of which is freight).

You can pay your local dealer a "haggled-to" price of $550 or so, or you can 'steal' one off the net for $500, then pay $25 freight and another $20 for the transfer fee. Total margin for the local guy - 16%. Total margin for the internet guy - 8%. Price to you - $550 either way.

Since your into the gun for the same money either way, doesn't it make sense to find someone local that you like doing business with? Keeping them supported and in the black can only be good for keeping your purchasing dollar as healthy as possible.

Brad
 
I've worked in retail, and I've worked behind a gun counter. I know what the things cost. Guns are much like computers - the money isn't in the core system, it's in the accessories. Computers are marked up 5-10%, accessories about 150-200%.

As for the Dissipator example, you're not going to convince me that a 25% markup on an item is reasonable when it KEEPS THE ITEM ON THE SHELF FOR YEARS.

Spiff wrote,
why is it that you 'thrifty shoppers' think a gunshop should sell you a gun marked up only enough to afford a happy meal when all is said and done?

Apparently I was not clear in my initial post. What I'm trying to say is that you cannot possibly justify a markup that doesn't move the weapon. I would have bought the thing for $900 and I told them so. They'd rather keep it on the shelf, gathering dust, for what is now several years. Marking it down would have lowered their profit margin, sure. But if they priced it at $900 instead of $1000, they would definitely have sold one and in all likelyhood could have sold others, therefore making the $200 from two sales that they haven't made at all since the thing has been sitting there.

If you sell me what I want for a reasonably competitive price, you make money on the sale of the item AND from the accessories I buy with it. I need some mags, maybe a case, definitely some ammo - all things that are marked up much more than the firearm. Price the gun too high, and I buy none of these things.

The point is that making a sale with a low margin is better than making no sale at all.


Brad, I completely agree with you. I buy locally when I can, but there's just no part of me that feels the need to spend $1k on an $800 item. Come to think of it, with the exception of my C&R stuff I've bought all of my guns except my Yugo SKS (pre C&R license) and my AK from local shops.
 
All those ideas are great but they take $$$$$$$$...

here in San D there are several gun stores across a broad spectrum of decency. The crappy hole in the wall with weirdos wandering around and horrible customer service charges a full $50 per gun less than the one a couple of miles away with the air conditioning, the nicely swept range, and the employees with a college degree. It also charges $7 for the range instead of the nice place with charges $15. Its membership is half the price of the other.

So all those things can be had provided customers are willing to pay for them.
 
As for my biggest gripe about gun shops: transfer costs. I got my FFL mainly out of spite, because I couldn't find a dealer who would transfer a gun for under $30. I don't know what they should cost, but I know about how much time it takes to address an envelope/send a fax, log a gun in and out, and fill out the NICS online form. The total time of work put into a transfer is under 10 minutes, and the only cost to the dealer is time. At $30 that comes out to $180 an hour.

Boy, do I agree on this one. Particularly when it's a private FFL holder. He operates right out of his home. Why does he need to charge so much to do a transfer:confused: It's not like he has a big overhead like a gunshop owner does.
The ones here want $25 to $40 for a long gun and $40- $60 for a handgun.
Some want 10% of the purchase price:what:

Maybe I'm missing something here. I just don't get it
 
Some FFL holders want to make a little money for going through the hassel of getting one. I charge 10.00 but if I did not make money selling Ranger and Federal Tactical ammo I would charge 15 or 20 for a transfer. There is no money in selling new guns so a basement FFL only has transfers to mske money on.

If someone wants me to put money out of my pocket for a gun I will have to charge 6.25 sales tax. If it is a simple transfer meaning the customer paid the seller and all that I have to do is paper work and pay for the back ground check than the ten bucks is all that it will cost.
 
Why does he need to charge so much to do a transfer

It's called "Free Market" or "Whatever the market will bear" :D

With it getting harder and harder to get (and keep) a "Kitchen Table" FFL01 (i.e. non-storefront), some folks feel they are justified to charge more for their services.

Dean
 
Profit

Make 20 bucks off five people-five happy customers who will be back to spend more money and good word of mouth advertising.
Make 100 bucks off one customer-one unhappy customer not comming back who will cost you a lot of money in bad mouthing you and you shop.
To be sucessful and to do it the way everyone wants you to do business you have to be a muliti billionaire,who does not need the money in the first place,just happens to have a REAL love for firearms and people.

992
My .02 worth.:) :) :)
 
6. If you don't want the customer farting with something that's right out there in the open? Put up a sign, damnit. Don't wait until the guy picks up that gun and then snap at him about it. If he ignores the sign, then point it out to him.

Oh hell yeah. This goes for gun shows especially. If you don't want me to touch your guns, then put up a BIG sign that I can see. Too many times I am handling something and the person behind the bench yells "DON'T TOUCH MAH GUNS" and points to a sign that is 1,400 feet away written on a 3x5 notecard that says "Don't touch mah guns."

And besides, it's a damn gunshow. Don't bring guns to a gunshow and put them out in the open on a counter unless you want people to handle them. Either stay home or get a glass case or something.

Also, how come all gun shops have the automatic rifles behind the counter? I'd like to actually pick up and put an AR-15 to my shoulder one of these days, but they're never out in the open.
 
Oh hell yeah. This goes for gun shows especially. If you don't want me to touch your guns, then put up a BIG sign that I can see. Too many times I am handling something and the person behind the bench yells "DON'T TOUCH MAH GUNS" and points to a sign that is 1,400 feet away written on a 3x5 notecard that says "Don't touch mah guns."

And besides, it's a damn gunshow. Don't bring guns to a gunshow and put them out in the open on a counter unless you want people to handle them. Either stay home or get a glass case or something.

So if someone came up to your house and started running their hands all over your car - opening doors, taking the valve covers off, sitting in you clean seats with greasy shorts on - you'd be okay with that?

It's someone else's property. Gun show or not, good old common sense and COURTESY!!! dictate that you politely ask the owner if you can handle the gun. Anything else is just self-centered laziness or absolute disregard for other people's stuff.

Brad
 
Some don'ts-

Mainly, keep your personal unbased opinions to yourself. When I turn 21 I plan on buying a 1911 for my first handgun. Talked to the guy a little bit just last week while scoping out gun shops in my new town if he could order the one I decide on. His reply? "Colt is going out of buisness and will be closed in a few months. Besides you have to do so much to them to get um ready for carry it isn't worth it. And them kimbers there'll shoot rings around any Colt." Ok, but I didn't ask you that. I asked you if I decided on a specific model in production if you could order it for me when the time comes. I don't care that you think Colt is going out of buisness. I don't care if you think Colts need a lot of work to make them worth anything. And I certianly don't care if you think a Kimber 1911 will shoot circles around a Colt made 1911.

Second, don't be rude and learn some customer service skills. I have lost count of the number of gun shop workers have been flat out rude to me, and I don't even take up much of their time due to the fact I research most of what I want to know on the internet before I head to the gun shop. When someone asks a question answer it for them politly. If you work with people you know perfectly well the customer is not always right. But you also know that if you want them to do buisness with you you'll kiss their behind and make them think that they are right. At least you know this if you are any good.

Third, don't consider yourself mightier then thou simply because you are working behind the counter and I am in your store. If I ask you to see a certian gun, that is the one I want to see. Don't try selling me on the fact that it is to much gun for me or that I would be happier with something else. If you think my hands are to small for a full sized 1911 keep it to yourself. If you think they are to big for a pocket gun keep it to yourself. If I like autos don't try selling me that wheel guns are better cause they never jam, and if I want to see a wheel gun don't try selling me on auto because they have better whatever. If I ask for your help lay out what I want to achieve and ask for opinions then feel free, otherwise keep your trap shut don't treat me like a moron and show me what I wanted to see.

Fourth, prices. I understand you are in buisness, at the moment I am working on putting together costs and what not so that I can start up my own soon. I understand you have bills to pay and what not, but when you are charging me a lot more then what the guy down the street is you are either trying to rip me off or really need to reorganize the way you are doing things cause they aren't cost effective. Small differences are one thing, but large differences are another.

Fifth, fees. Nothing bugs me more then someone overcharging fees to make it no longer worth it to buy a gun and have it transfered then to buy the gun from the shop. Charge a fee worth your time and be done with it. Charging fees in excess of fifty dollars, and even more so then a high flat fee percentage fees on the price, will make me take not just the buisness of this transfer but of all my gun buys elsewhere. You are not entitled to an amount I paid the seller, it has absoloutly zero to do with the service you are providing me. You aren't selling me the gun, you are preforming a background check on me, and while the two are connected the service you are offering and the one the seller is offering are two different things.
 
So if someone came up to your house and started running their hands all over your car - opening doors, taking the valve covers off, sitting in you clean seats with greasy shorts on - you'd be okay with that?
Very poor analogy.

You're not in someone's home, you're in a store that is open to the public. You're not looking at something without permission, it's been set out specifically for you to look at. If they don't want you to touch it, they can put it behind glass or put out a sign.

It's not reasonable to compare going into someone's house with entering a public business, nor is it kosher to liken handling someone's personal property in their home without permission to handling merchandise in a store.

Dissassembling stuff is another story, I fully agree that one should ask permission before taking things apart.

Lupinus,

I fully agree.

Somehow gun store clerks get words twisted around.

You say:----------------------------> They hear:
Could I see that gun? -----> Which gun do you like more than this one?
Can you order me a Colt?--> Please tell me how Colt is screwed up?
I'd like to buy a Ruger.----> What guns do you make a higher profit on?
Could I buy a box of 9mm?-->Explain in detail why your opinion is better than mine.
 
Lupinus,
I agree with your first 3 points.
However my feeling on #4
but when you are charging me a lot more then what the guy down the street is you are either trying to rip me off or really need to reorganize the way you are doing things cause they aren't cost effective
I would say why don't you just go down the street? (or does that shop have other problems you like even less?)
And #5,
Charge a fee worth your time and be done with it.
I would say maybe he has decided that his time is worth $50.00 or whatever.:D I have a suspicion that the $50.00 might be pretty close to what he would make on the same gun if you bought it from him instead of some mail order/on-line source. (It's not in his best interest to help you beat his prices.)

Dean
 
hotpig said:

I got it now. In order to run the best shop possible I just need to focus on a few things.

I need to hire customer orientated employees with verifiable "expert" knowledge in all fire arms, reloading, accessories, and State and Federal laws.

I need to be open 24/7

I need to stock every firearm that has been and is currently produced.

I need to sell these guns at or below whole sale.

I need to give trade in value at or above the whole sale cost of new guns.

I have to stock all calibers and brands of ammo and shooting accessories, and sell them at cost.

I need to spend the big bucks on a importers license in case a customer wants something that can not be found in the US.

- Nobody in this thread is demanding employees that know everything about firearms.
- Who said that? We're only asking that stores stay open past 4 pm on saturday.
- Nobody in this thread is complaining about stock, beyond saying that a store should have more guns than you have at home.
- Nobody in this thread is complaining about fair prices.
- We've established that it wouldn't make sense for store owners to do so, and few people in this thread are complaining about that.
- Nobody in this thread has complained about that.
- Only one person in this thread has complained about importing from other countries.

I know you're being sarcastic, but you're using a strawman argument. For most of your points, no one in this thread has complained about any such practices.
 
I would say why don't you just go down the street? (or does that shop have other problems you like even less?)
Ah but the same could be said for the rest. Why not go to the shop that doesn't act smarter? Doesn't push other guns you didn't ask about? It all wraps together into one big happy customer pie. And over charging is no different then pushing or rudeness, its bad buisness practice. I'm not implying he doesn't have the right to charge what he wants, but that doesn't make it a good idea.

I would say maybe he has decided that his time is worth $50.00 or whatever. I have a suspicion that the $50.00 might be pretty close to what he would make on the same gun if you bought it from him instead of some mail order/on-line source. (It's not in his best interest to help you beat his prices.)
Because his 15 or 20 minutes isn't worth fifty bucks even mechanics don't value their time that much and its a lot harder then making a phone call and some record keeping. But it isn't so much the price it is if the price is fair or high, agian this goes into the same thing mentioned above. He has the right to do it but that doesn't make it a good idea or a fair buisness practice. And even then, my main rant is agianst the charging of a percentage of the price as the fee. The price between me and the seller has squat to do with him he is charging for his service not the gun and the price for the gun therefor has nothing to do with it and he isn't entitled to it. I've even seen ones try charging both. Agian, their right, but bad buisness.

And while I agree that they don't have to help you beat their prices I can't say I agree with it being agianst their interest. A happy customer is a happy customer and one who returns. If he charges me a fair transfer fee he is still making money for doing very very little. And when I have more buisness I am going to remember "Hey, it was John and AYZ Gun Shop that didn't rip me off on that transfer a few months back out of spite, I'm gonna go buy that gun I have been wanting from him." And my ammo, accesories, etc. It may be just about one gun, but for the guy where guns are really a hobby and spends a lot of his money in the area it most certianly in the shops interest to keep him happy even if the customer isn't buying the gun from you but someone else because he is going to be buying the ammo for it from you for the weekly range trip. And one customer isn't one, it is ten. One customer tells ten of his friends about it.
 
I really don't expect every gunshop to want to help a customer to import a completely legal but hard to find model of gun into the country. But it was my understanding that any FFL can initiate a Form 8 without any need for an importer's license. The problem is when virtually none of a state's FFL's wants to do one, it makes it nearly impossible to fulfill one person's supposedly legal option, to import a gun for personal use rather than profit. In a more ideal world, legal importation shouldn't have so many roadblocks imposed by most, if not all of the region's FFL holders. It's not necessarily the gov't. regulations either, but rather the multutude of FFL holder's that act as the roadblock.

Before you get too excited about importing guns, you need to use the correct form. It is a from 6 for importation. I have never seen a form 8.....

Anyway, for a dealer to import a weapon for resale, they need an importers license. Those run about a $1000 a year. Now granted, one may slip under the radar ut if it does not, you face some serious fines and all sorts of un-pleasantries with the ATF and possibly ICE.

But YOU can do your own form 6, without a dealers assistance. All the blocks are detailed on the second page of the form in nice easy to read formats (for a change).

So when you get a dealer that says they don't want to be involved, don't get mad. Do it yourself. Why do you want his help anyway? If he has not had good luck with it or done it before he will not be of much use to you anyway. What you need to do is go to an importer and get their help.
 
Providing there are no ITARs, sporting purposes, or banned country restrictions they are actually very good. I know lots of people who have done it for hunting guns from Europe and South Africa, and even more people who have done them for military vehicles.

If you are military, there is even an express form you can fill out while in country for that side by side you got in Turkey.
 
And your chances of getting a "home-done" Form 6 approved are?.........

If done properly, 100%.

I've worked in the transportation industry for a while, prior to my current job, I worked for a regional trucking company, (prior to that I worked for an importer and before that I worked for an overnight delivery service. They used to be Silver, but are now Red and Yellow). I was the Assistant Operations Manager as we were also a US Customs bonded warehouse and an Air and Ocean Freight breakbulk facility for a Customs Broker/Freight Forwarder (NVOCC). They had a couple of customers who just used the Freight Forwarding portion of this business and did their own customs entries. It can be done, the learning curve can be somewhat steep, as several of their initial shipments went General Order and they had to pay various storage charges and fines ("What do you mean this is Quota merchandise and the Quota is filled ?") They quickly learned that it was much easier to pay the guys who were familiar with the Customs Regs ("A Binding Ruling ?!?!?!?, that means that it's binding on YOU, not US Customs.) and the HTS to get your freight cleared and released. As we used to advise, there's a reason why people hire Surgeons..... Sure you can do it yourself, but the process may be painful and the results may not be to your satisfaction.

I've listened to to similiar customer gripes that I'm hearing here.
"Why do you charge $35 for Haz-Mat, it's only a extra form or two that you have to fill out." Yeah, until your package has a leak or spill and then I'm looking at least $5,000 for Safety-Kleen to come and haul away the salvage drum with your goo in it. If it's really bad, then I'm looking at an Emergency response situation with a the fun State and Federal fines tacked on. Oh, and I'm probably unemployed now, but at least I'll get three squares a day while I'm in prison.

"What do you mean that my NIB Jennings that I've put only 1,000 rounds through is worth $25." As buddy of mine who used to sell real estate would always say: "I would much rather tell someone that their spouse is cheating on them and their kids are gay/joining a cult/crack-addict prostitutues then to tell them that their house is worth less then what they think it is."


"I could rent a U-haul and ship it myself for cheaper the what you want to charge me." Try Ryder they're probably cheaper. If you don't like my rates go shop another carrier, because chances are this is not a lane that I'm interested in which why I gave a high-ball price or you think I'm too expensive because you figured out that Diesel is 3 bucks a gallon, you're shipping your freight 1,000 miles, and trucks get 5 miles to the gallon, therefore it should only cost you $600. You don't think I should pay the driver, dispatcher, CSR and dockmen for their time or that I should make my truck and trailer payments this month, much less actually be able to show my accountant and the bank that I actually made a profit (so that Uncle Sam can tax it to zero.)

I really can't wait for you "experts" to go and open up a gun shop. I'll be a steady customer, as I want to pay $10 a bag for lead shot, 209 primers for $10 per thousand, kegs of powder for $5 per pound and wads for $2.50 per bag of a thousand.......right up until you go out of business. (oh, and I won't hang out at your shop, sucking down free coffee and regaling your other customer with tales of my daring-do as a *HANO* qualified-Space Shuttle Door Gunner during the Spanish-American War. ;) )

I will grant you that not all of your suggestions are wrong or way off-base. Yes, basic politeness, common sense and customer service are keys to the success of any business. But expecting any business to give you new price for a used item is asinine. It's a business, they're not there to do you favors. Their thing to to provide goods and services and make the most profit at the highest price that the market will bear.


*HANO* - High Altitude, No Opening :p
 
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