Business Idea - Your Opinions Please

[FLMike]

Hello folks,

I'm a new member to this forum, though I've spent quite a number of hours browsing through the topics. Obviously there are a number of people here with firearm knowledge and experience. I thought I'd bounce this off the forum:

I'm a security professional, weapons / shooting enthusiast, firearm owner. I've been working on my collection for a couple years, and have 8 pieces to date. I'm a Glock "fanboy" though I own and enjoy other models as well.

I've been interested recently in the idea of getting my FFL, opening a small gun shop, where I would offer a limited selection of weaponry, and a few services. I've done some research (some of which on this forum) and am aware of some of the hurdles. I have an idea that for new items, I would like to offer Glock exclusively. Used / trade it items would be a variety obviously.

My idea also includes offering Glock accessories and gunsmithing - as I plan to take the Glock gunsmith course whether my store idea comes to light or not. I would also offer simple firearm safety courses, CCW training, and first aid / CPR / AED training. I am already certified to provide the firearm and first aid training. Of course, FFL transfers would be provided as well.

Anyhow, as I said this is just an idea of mine at this point. And I would value feedback from the forum. I know there are experienced people here, and perhaps also some people who have something similar going on.

Thanks,
Mike

 

[docnyt]

If that's what you love doing and can profit from it, go for it. I would like to add that an indoor range may add value, assuming your locale allows it.

 

[kingpin008]

I'm all for competition in the marketplace, but keep in mind that you're going to have to be able to compete both pricewise and in the types of services you offer with other shops like:

Lone Wolf
TopGlock
Glock Meister
Glock World
Glock Store

These outfits are already well established, and offer a HUGE range of items and services. To keep your local customers shopping at your place, you're going to have to find something that you can do better or cheaper than they can, or else. The same goes with the local shops that already offer a RANGE of different brands, as well as transfers, safety/CCW/etc training, and gunsmithing. Find a way to undercut them, or offer something nobody else does, and you're golden. Otherwise, you'll sink faster than the Titanic.

 

[longdayjake]

I am a business owner but I deal with mostly internet sales. The very first thing that you should do is make up a business plan. That will include all of the costs of starting your business and then the overhead once it is running. Look at FFL fees, insurance, insurance again, insurance one more time, possible legal fees, storefront rent, advertising, product cost, utilities, and a big cost that a lot of people overlook is storage space (in a gun store glass cabinets are essential and expensive). There are many other costs involved that you need to look at but I can't think of off the top of my head.

Then you need to look at the market in your proposed location. The problem that I see with your plan so far is that it will be mostly a glock store with a little bit of glock gunsmithing thrown in. Well, I have yet to meet more than a handful of people that ever needed a glock worked on. So, if you are hoping to make a lot of money smithing on glocks you had better hope that your area has a lot of glock shooters that break their guns. Secondly, if you will be competing for business you should know that Glock does not allow you to advertise new guns below a certain price. So, it will be unlikely that you will be able to draw customers looking for new Glocks simply based on price. So, you will probably have to offer something other than just new Glocks to get customers in your store. Most small gun store owners will tell you that they make most of their money in the used gun department and that new guns are a very small markup and they would not survive if they only sold new guns. If you are going to offer classes you should find out the demand for it in your area.

To be frank, the way the banks operate right now you can have the best business plan in the world where you would make 10 million a year and they still won't give you a loan. If you are looking at getting money to do this from somewhere other than your own pocket you WON'T get any from a bank. You will have to look at a private investor/investors.

 

[FLMike]

Thanks guys for the responses. That does give me some things to think about.

I had not thought about the minimum sales prices imposed by Glock, that's a good point and would absolutely affect me - as I was in fact going to use price as a tactic to draw customers. I'm not sure that I would ever be able to compete with some of the online guys. I've dealt with Bud's several times, all positive experiences I might add, and they have some pretty killer prices. I have also done business with Glockmeister several times, their product line and service are outstanding. As a matter of fact, my next Glock purchase will be though their new LE purchase program - hard to beat it.

I do need to put together a solid business plan as you said, and I'll need to do some more research and thinking about services too. Perhaps I need to lean out my vision of selling a full line of new Glocks, and focus more on the used.

Issues I'm working on getting information on now is zoning, insurance, and building requirements. Of course anything that I would lease would need to match whatever zoning and building spec requirements imposed by the fire marshal (ammo) and ATF.

This is something that I would love to do for sure, but surely not something that I'm going to rush into. If I do it, I want to do it right.

Thanks again guys!

Mike

 

[Roan]

I think you should rethink basing your business around a single product line or manufacturer. You may be convinced that Glock, for example, is the single most potent and important weapon on the face of the planet and that it is the silver bullet to solve any problem. Even if this is absolutely true, it still doesn't matter, because what you believe or know has no impact on the beliefs and desires of your customers. Right now, you want to share your excellent Glock experiences with your customers, and sadly, this is the wrong frame of mind when considering a business. Instead, you need to figure out how to make money. This may seem a little mercenary, but that's how business works.

Therefore, you need to examine products not for technical excellence but for profit potential. Glocks will probably fall into this category, but I would be surprised if this was the only product one needed to survive.

The next thing you need to consider, and one that is often overlooked, is the aspect of time. There is only so much time in the day. If you want to maintain regular business hours, all gunsmithing will have to be done after business hours or you have to hire help. Are you really willing to work 12 hours a day, possibly every day, for profits that will be extremely meager for the first years your business is around. Don't forget your paperwork, such as taxes, FFL paperwork, gunsmithing paperwork, inventory, and so forth, all of which will likely need to be done after business hours as well.

Opening a business is a daunting task. It should not be considered lightly and it should be considered in full understanding of the monumental task that starting a business entails. That doesn't mean that there aren't rewards, but if you need income from this business to survive, it might be a better idea to approach an existing business to offer training through that establishment.

 

[jlg]

Getting your FFL is easy - $200 and some paperwork and fingerprinting.
Getting set up as a Glock Dealer is more difficult. You have to have a storefront, with a sign out front, posted hours and a decent on-the-shelf inventory or they won't even consider you. You can always buy through wholesalers but the pricing won't be as good and so your profit won't be either.

On the plus side, if Glock does accept you and you order their Stocking Dealer Program, you get great pricing on whatever 15 guns you choose from the program and they'll send you through their armorers school for free.

There isn't much profit in firearms anymore, especially with all the online stores selling for little to no profit and counting on bulk sales to make their money. Make sure you aren't depending on firearm sales to pay your bills. The guns draw people in but the money is made on non-firearm items.

 

[FLMike]

@ Ronan:

You are right about the product line, 100% When I started thinking of what product line, or manufacturers that I thought would generate the most sales vs cost to me, Glock really stood out. I am a huge fan of Glock, I own a few, though I also own other manufacturers and really enjoy them too.

With Glock, I was thinking fairly low initial cost to acquire product line vs some other manufacturers. What I didn't think of, and now have to take into consideration is the minimum sales price required for new Glock firearms. Another suggestion from earlier in the thread was to offer more of a used variety in increase revenue.

I guess at the end of a long story is I'm considering ways to get into a business I feel that I would enjoy, at the same time staying within a budget that is manageable for me during the initial start up. I would love to be able to start out with a full product line and offer higher end models - but that is just not fiscally possible. I am probably being to much of an optimist, but I was looking towards something I could grow over time. I should probably do some research into some other manufacturers of similarly priced handguns, and what their dealer req./min orders are.

Good point about the amount of hours that would be required, as I try to put a business plan together, I'll need to take that into consideration.

Thank you for the feedback. After the comments I received today, I have some new things to think about, and some things to rethink.

Mike

 

[FLMike]

Thanks Jlg,

I did some reading up on the FFL, I actually had some questions about that and was going to call the ATF to see if they could clarify. The way I read it, for the Class 1 dealer license, it would need to be 'attached' so to speak, to the place you intended to do business from - so I was under the impression you would need a store front to acquire the FFL. I did talk to someone to has the FFL, and uses it for transfers and internet sales from his home - however his home happened to be zoned for that activity and of course that had to be verified. It seems easy enough if you have the clear background and can jump through a few hoops, but that was a portion I was unclear on.

You're right too, I'm going to have to consider what kind of income I'm going to be hoping to generate. I recognize that this at least initially can not replace the income I generate now - so need to determine if this is something that I can manage as an additional source of income.

Mike

 

[kingpin008]

Mike - Don't let all the new info/stuff to think about dissuade you. I'm in the same boat right now, starting to consider the steps necessary to open my own specialty bakery. It seems so simple at first, then you bounce the idea off a few people and they point out eight million things you'd never even thought of. :banghead::banghead:

One thing I've found that helped me a lot - sit down and really be honest with yourself about why you like the idea you have so much. If it's because you'd get to deal with your favorite firearm and fellow fans all day, then chances are you have your head in the wrong place. I kinda did this too, but in the FFL business, it's WAY different. There is SO much more to it than just stocking the shelves and a bit of paperwork. I'm sure you already know this, I'm just trying to illustrate a point - it's absolutely critical to have a solid, realistic idea of what you're capable and willing to handle before you get too far in.

Anyway, good luck with your future plans! Hopefully you come to a workable solution and get it going!

 

[jlg]

Mike, you are correct about location. You can use your home (as long as the area you are living in says it's okay to run a business out of your home...check into that first) but if you're serious about getting set up as a Glock Stocking Distributor you'll need an actual storefront.

Most firearm wholesalers require you to have a storefront as well. With a home based ffl you can make some money doing transfers for people and you may be able to make an occasional sale but it's going to be hard to compete with the internet sites when you can't buy things direct or can't get set up with some of the cheaper wholesalers because you don't have a storefront.

Call the ATF Distribution Center and they'll send you out a packet with all the info you need to file for your FFL. Here's their number: (301) 583-4696

Also, the Glock MAP Pricing is Minimum Advertised Price. You can sell it for less you just can't advertise it for less.

Good luck with your dream. Don't let the new questions disuade you. Just make sure you think everything through before you jump in. The majority of small businesses fail in the first year because they didn't think everything through and didn't set up a business plan.

Also, don't start out the gate buying a huge inventory or fixing your shop up supper nice. My shop isn't much to look at and I only keep about a dozen firearms in stock and my customers don't mind at all. Customer Service is more important than any other factor.

 

[Sebastian the Ibis]

If I were in your situation trying to make a run as glock dealer/gunsmith. I would offer Glocks with the grip cut down to the next lower size, i.e. G17 with a shorter grip that takes G19 mags, or a G19/17 that takes G26 mags. But then you as the seller/modifier offer the same glock warranty that otherwise would have been offered by glock had you not voided it.

I know a couple people that have done this and really like it. I think a G17 site picture with a G19 grip would make for an ideal carry gun. I've been thinking about doing it myself but don't want to risk wasting $475 to try. However, I would probably pay my LGS $525-550 for one that was already cut down and they are warranting.

 

[pikid89]

^ i dont hink i would try to run a shop selling cut up glocks...as a smith you could offer such a service
but to have pre cut glocks sitting in your case sounds like a bad plan...think of how many glocks are sold compared to how many are actually cut down

 

[blakdawg]

As a potential buyer, I'm not sure the "Glock only" angle is a big draw.

If I'm in the market for, say, a S&W, you've just told me to go somewhere else.

If I'm in the market for a Glock, OK, you're on my list, but you're going to have to have something pretty special for me to choose your shop over someone else that'll sell me the same gun for less $, or is closer to my house, or whatever.

I own several Glocks (not gonna say how many on a public forum) and have a lot of respect for the brand and the design - but I'm not enough of a Glock fanboy/partisan that I'd spend a lot of $ or drive a long ways to buy from a "Glock only" store.

When I'm buying, I care about convenience (close to me? have what I want in stock?), price, customer service, and I would prefer, given a choice, to patronize a smaller locally owned business.

The problem I see with being a Glock smith is that I wonder if it's a lot like being the Maytag repairman - e.g., bored. Mine all seem to work fine with minimal effort on my part, no gunsmith required. If one of mine did break, my expectation is that if it wasn't my fault, it'd probably be repaired by the Glock factory for just the cost of shipping to them as a warranty repair.

So I don't know if I'm ever going to need a Glock gunsmith. Someday I'll want to get my night sights replaced, or add some to mine that don't have them - but if I go to a GSSF match, my understanding is that they'll have a smith there who'll do that for free (I buy the parts from them).

I think it'd be tough to get the numbers to work on a store selling only guns - most small businesses, if run well, can return somewhere between 30 to 50 percent of the gross income (gross revenue minus cost of goods sold) to the owner.

You said you want to compete on price - so let's say you can make $50 for each gun sold.

Let's say that you want to make $50K per year (actual cash in your pocket, before taxes) - and you can run your business to hang on to 40% of your gross income, which is really pretty optimistic.

$50,000 divided by 40% is $125,000; $125,000 (target gross income) divided by 50 (income per gun) is 2500. So, if you make $50 per gun sold, you'll need to sell 2500 guns/year to bring home $50K. If you close up for 2 weeks per year for vacation (ok, unrealistic for a small business, I know that's 50 guns per week - 7 per day if you're open 7 days, 10 per day if you're open 5 days per week.

That's a pretty busy gun store - gross receipts of $1.25M, and if you want to have two weeks' worth of inventory at $400 per gun, that's $40,000 you've got sitting in your safe.

If you can manage to get $100 per gun in gross profit, you've only got to sell 1250 per year, or 25 per week, and inventory will be only $20,000.

Perhaps someone who's an FFL (or even a Glock dealer) can suggest more realistic numbers - the numbers for wholesale price and gross profit are guesses based on what I've read on message boards.

 

[danprkr]

I'd think that if you're going to be exclusively Glock (or any other brand) you need to be in a huge market to have enough single brand business to make a living, and you'd better be THE EXPERT on that brand in your area. Otherwise you'll not have enough traffic to make a living. Not knocking the idea, but I live in Austin an area of about 3 million, and I doubt there are enough dedicated Glock guys to keep you in business. Move to Dallas/Fort Worth or Houston and MAYBE.

Just my .02 worth.

 

[HD Fboy]

Couple of comments:

Who is your customer base? How do you plan to get them in the door and separate their money from their wallet?

How long do you expect it to take for your business to become financially viable?

Where will you get the start up capital?

How will you pay your living expenses during the start up phase?

Being able to work in the area which is your passion can be a double edge sword. The passion can become a job. and if it doesn't work out the passion will become sour.

The Business Plan comments are very important.

I am not being a naysayer here, just been there done that unsuccessfully and successfully.

 

[Patriotme]

I like Glock but I'm far from being a Glock fanboy. As I sit here thinking about a gunstore that only sells Glocks and Glock accessaries I kind of lose interest. I like a bit of variety when I go browsing for guns. I'm actually planning to buy a Glock this year and the idea of going somewhere with a single product kind of bores me. If the price was right I'd definately go there for a gun purchase but I don't know if I'd be back.
There's a couple of local stores with a decent selection of guns. Usually when I go in I'll buy a mag, box of ammo or some cleaning supplies while I'm there. Maybe I'll buy a gun from one of them (I've bought from everyone in my area at some time) every year or two but I go in there to look and they are going to make some money off of me no matter what. They get me in the door with their selection. Maybe I'll see a "Gotta have it" gun on the wall or in the case. Maybe it will happen six months later. The thing is that they are getting me in the door with their range of merchandise.
Having a store that merely sells Glocks is going to get me in the door when I'm ready to buy a Glock but after the first visit it's unlikely that I'm going back in to browse. It would be like tire shopping. I'll stop by when I absolutely need to.
You know who has the greatest idea in the world in regards to sales? Motorcycle shops.
They always have one really hot woman working in there that is willing to talk to customers. 20 doofs per day will stop by to talk to the friendly hot chick and buy a piece of chrome or t shirt while they're there so they won't look like a stalker. Something to think about if you do some hiring.
One more thing about Glocks. Everyone can work on them. There's video after video on YouTube about how to work on the trigger, you can just drop in a Lonewolf barrel and you can buy parts everywhere. A friend of mine with almost no handgun experience recently bought a Glock and has jumped into the shooting sports with both feet. He's already modifying his Glock and it runs perfectly fine.
I remember when Bass Pro Shops opened 1 1/2 hrs away from my city. Every hunter, fisherman and gun person I know visited them within 2 months. Their selection got people in. You need to at least get people to visit from across town.
What is your hook going to be? What is going to keep those of us that buy waaaayyyy too many guns coming back to your store instead of the local competition? I don't know what kind of local competition you have but you will have to find some way to differ from them.
Man....this is running long.
You seem to be pricing your product at those that can afford $500-$600 handguns. There's a lot of people out there that buy the $300 stuff. Your current business model is going to turn away a lot of customers.
What are you going to do about used merchandise? Are you going to take trades or buy used guns? If so you are no longer excusively selling Glocks but you will probably have a rep as the guy that only sells Glocks so those looking for a less expensive (new or used) handgun might skip your shop.
I wish you luck. I think that you were very smart to throw your idea out there for all of us to criticize. Maybe you'll get one or two ideas that will work for you. You're definately polling your desired customer base and that's a step in the right direction.
BTW, what state are you in?

 

[oneounceload]

Instead of "Glock only", you might be better served by focusing on handguns and gunsmithing for ALL types, having classes, range, ammo/accessories, transfers, etc.. You can always add long guns, but having a choice is what people want - let them compare Glock to XD to XYZ brand side by side

 

[22-rimfire]

In opening a new retail store, I would try to be as diverse as my resources allowed in terms of offering products to the public. Inventory costs. The recent interest in small 380 ACP handguns is an example... your would have totally missed this developing market as Glock does not offer a product that really fits this market

I believe internet sales are really cutting into sales at local gun shops. They are being reduced to just transfer agents and I don't think you can survive in a business on that basis unless it is part time run out of your home where zoning restrictions often come into play.

There is one shop near me that primarily sells EBR's. They sell handguns too. But, their prices are a little high and I seldom go there. I have nothing against the shop or the guns. Their focus is simply not my focus. But if I want to see a great selection of EBR's, that is where I go. So, in your case, if I want a Glock, then I would head to your shop.

What you want is for a prospective customers to always go to your shop first. I generally visit a couple gunshops and the past has shown that their prices are fair. Hence, I go there first and usually end up buying there because I don't visit 5 gunshops looking for common guns. I already know about what the price should be.

 

[cjwise5]

i have owned a tactical store for about 4 yrs now. online and a storefront. my advice is: if you can keep it small and do it out of your house, then its a great idea. i had to close my store this year. the simple fact is what we see as necessity (guns and gear), most people see as unattainable wants. just don't barrow any money in this economy, you'll most likely never make it back. my two cents.

 

[dogtown tom]

A "Glock only" store reminds me of the old Saturday Night Live skit about the store that sold only Scotch Tape.

If you look at the successful businesses in retail you will see those that try to cover everything: like WalMart, and those that have carved out a niche: SunGlass Hut. But even Sunglass Hut carries more than one brand of sunglasses.

 

[youngda9]

Get your FFL right away, that would be your first step anyways. While you work out the details of a larger operation, you can use transfer revinue to get your feet wet to see if you like the buisness, make some contacts with potential customers/investors, and that will provide a revinue stream right away.

 

[KBintheSLC]

Examine your competitive environment very closely (both online and local). Look at their strengths and weaknesses. If you can come up with a competitive edge over the vast list of competitors in that field, you may stand a chance. I agree that you should start small... maybe gunsmithing at home and selling gear online from your garage. If you get neck deep in a costly retail space lease, it will be years before you see any returns.

 

[ForumSurfer]

Post #16 gave some good info.

A "Glock only" store reminds me of the old Saturday Night Live skit about the store that sold only Scotch Tape.

Yeah, I have a large variety of local gun stores where I'm at. If someone opened up a glock only store, I doubt I'd even drop in. Glock-centric...yes. Let's say I need a new holster for my glock. You may definietly have the holster because, well it's one of the few things you sale. Jim-Bob's Ye Olde Gun Shoppe just a few blocks away from you also has the same holster....but he also sales reloading supplies, AR parts, ar accessories, shot gun accessories, ammo for everything under the sun, flashlights, rifles, different pistols from other manufacturers that I may or may not have seen in person, etc. Even if you undercut Jim-Bob's price, it likely won't be more than $5. Personally, I'll spend a couple of extra bucks just so I can look around at all the other stuff.

I don't know about the gunsmith bit, either. I've stripped a glock down to a pile of parts that can't be disassembled any further. You don't need a glock armorer to do it for you or to replace any parts. You don't even need any crazy tools, just a screwdriver and a punch (or a paperclip or whatever) and a youtube video for the first go around. That's why I bought the dang thing.

Either way, good luck! I'm not trying to be negative...just offering a point of view from someone who would be your target consumer.

 

[22-rimfire]

The simple fact is what we see as necessity (guns and gear), most people see as unattainable wants. just don't barrow any money in this economy, you'll most likely never make it back. my two cents.

I agree with this as well and it is spoken by someone who "knows".

Investors want a return. Capital is tough to get and repaying it can be even tougher.