I am really tired of good gun shops closing.

[WillBrink]

I have noticed a bad trend of good gun shops closing. My friends shop closed last year. Now the new shop I have been going too has also shut its doors. He was also the only local Class 3 Dealer with a Silencer Shop Kiosk. The only shops left are the FUDD shops with questionable ethics, and the Bigger shop that still thinks a Basic AR is worth $1500 and thinks Bushmaster is the best thing on the market.

Is this a regional thing or is it also still looking bad in other areas?

It's applying to everything I like, audio stores, watch stores, mens clothing stores, etc where quality vs price is a big factor. Marketing and cheap chit beats quality pretty much every time sadly.

[Tx_Aggie]

The problem is todays gun buyers just won't support a traditional "non chain" gun store.

You can have the greatest place in the world, fully stocked with the most knowledgeable sales staff...but right now a Colt LE6920 dealer prices at $1276.00, that is the price "I" pay PLUS shipping if I want one. Also I carry all the operating costs of being a FFL.

The Retail price is $1499.00 and unless we are in the middle of a Biden WON the election or some other full on panic buy, NOBODY is paying $1499 for a Colt 6920. Dealers are damn lucky if they can bump that rifle up to $1350.00 which isn't even a 10% markup and a 10% markup was the kitchen table FFL standard fee back in the 80's. Btw even a 10% markup would be $1403 plus shipping and NOBODY is paying that.

The expectation of 99% of gun buyers on the internet is $1276 plus a $25 "transfer fee" for a "out the door" price of $1301. If a dealer actually has to pay a background check fee to the state or talks about sales tax most guys will walk until they find that guy who will do it for "dealer cost + $25" on any firearm.

And every year there are a dozen new FFLs who think they are going to own the market because they have some plan like "dealer price + $20" out the door and in three years or less they will also be out of business because it's unsustainable.

The problem is buyers can't get guns at dealer price without the participation of a FFL and there is no drop shipping so what everyone wants, which is essentially the Amazon business model, can't exist because of the 1968 Gun Control Act.

So gun stores go out of business because even at $25 a sale they simply can't get enough volume to cover their operating expenses, they don't sell as many guns as pizzerias sell pizzas and they never will. The only good news is now Wal Mart and a lot of other discounters no longer carry guns so maybe a few long time gun stores will be able to hang in there. But I think how many there were when I was a kid and nearly all of them were long gone by the time I left South Florida, and that was in South Florida where there was a huge gun buying market.

Most went from stocking dealers with walls full of the newest popular models to sad looking display cases of shit that never sold and a half dozen boxes waiting for a customers to come in and do "transfer paperwork" for $25 in the till.

It's just what happened. Add to the fact that the difference between dealer price and retail price is no longer something like 40%, because that is how manufacturers and wholesalers are surviving and the point of purchase FFL makes less money selling guns than just about anything else he might sell.

This squares pretty well with the time I spent managing an small independent gun shop.

We did some business in NFA items, almost entirely suppressors, which helped make up for the slim margins on everything else, but it was a struggle (and margins on suppressors aren't exactly good either). Large online ammo vendors selling at essentially wholesale prices doesn't help either, and makes ammo as much of a loser as gun sales. Margins on accessories are better, but you'd better have a large selection on hand, because a customer can nearly always find what they want for less (often without paying sales tax) online and have it delivered to their home within a couple of days for free.

Distributors will also gradually raise their wholesale pricing on your account, further eating into margins. We had the advantage of being in what amounted to a buy group with several other shops owned by the same group of people, giving us some leverage in terms of total sales that we wouldn't have had otherwise, Still, one of the owners was almost constantly in the process of re-negotiating pricing with one distributor or another.

As you said, doing transfers and selling new guns at essentially no mark-up is not going to cut it. A shop really needs another source of revenue to have any hope of success.

[Renegade]

SteyrAUG has it covered.

I know dealers around here who do 2000 xfers a year and carry zero inventory. Folks go to big box stores to finger-phuck guns, then order from Buds or grabagun for delivery to xfer FFL.

[Adrenaline_6]

Luckily my LGS is one of the, if not the biggest store in Central Florida, but also is not a chain. Their inventory is huge and their prices are fair. I know that sounds weird, but I think that's what got them where they are in the first place.

I just bought a Tikka T1x from them the other week. Sure, I did some internet shopping and could have got it a little cheaper doing it that way. A little less than $50 probably. I chose to support my LGS instead. Their inventory is amazing. The full gamut of quality of AR's from KAC (when in stock), BCM, and DD down to the S&W, RR's and Bushy's. They have Barrett on display. They also have the suppressor kiosk as well. They have a huge line of safes when you walk in, optics, knives, the handgun selection is amazing too.

I would hate to see them go under and lose that kind of store and atmosphere. It's like a candy store for us guys. All internet would really suck.

[VIP3R 237]

Firearms and ammo are a loss leader. As Steyr said, you cannot survive on 10% margins which is about internet standard during non panic buying times. You need other items to cover your operating costs such as clothing where your margins are 100% or more.

[SteyrAUG]

They all have something they're good at and that's what keeps people coming back.

That's what it takes, because if you think you are just going to sell guns ordered from the same wholesalers as everyone else...you ain't gonna make it.

Most make their biggest profits on used guns, not surprisingly, but this is where the get a bad reputation as well by offering 30% of what a used gun is actually worth. And even then it's still hard to compete with deep pocket discounters like AIM, CDNN and about a half dozen others.

Gun stores needs to have a range if possible. That's one way to be sustainable.

Sent from my SM-G965U1 using Tapatalk

And depending where you are located that might be impossible. Code and zoning requirements for a new manufactured range would blow your mind.

There's a joke about the FFL who won a million dollars in the lottery, when asked what he was going to do with the money he said he planned to keep working until it was gone.

[SteyrAUG]

Firearms and ammo are a loss leader. As Steyr said, you cannot survive on 10% margins which is about internet standard during non panic buying times. You need other items to cover your operating costs such as clothing where your margins are 100% or more.

Ammo is a dead market. Shipping costs from suppliers are higher than markup potential. For the last 10 years I bought all my ammo at Wal Mart because it was the same price as my dealer price plus maybe ONE DOLLAR and sales tax was cheaper than shipping costs to me.

Wal Mart simply had more buying power so they could sell ammo for essentially the same price as I could order ammo. Factor in that ammo doesn't require a FFL and that half of my distributors sell to end users so I end up being in competition with my own suppliers and that is such a no win situation it isn't funny.

For years I got along because my niche was being a MIL / LE supplier. Not that there is money to be made selling to military and law enforcement because they can order directly from the manufacturer and usually get a better price than I can, but being able to actually order items normally not made available to the private market (for a long time Colt required LE letterheads for 6920s, 6520s, etc.) and factory SBRs from any manufacturer.

Of course Glock came along and F'ed that up with el cheapo BLUE LABEL Glocks and Red Label Glocks that non special people were supposed to buy. Problem is you didn't need to be LE and firemen, paramedics and for all I know High School life guards technically qualified for the program and everyone knew someone who would order one for them so Gen 3 Glocks were forever $399 and if you tried to sell any Glock for $450 you were a SOB "ripoff artist" trying to charge 10% ABOVE RETAIL. So I just stopped selling Glocks completely.

Every years there was some new "dead market" where profits were impossible. I used to do group buys of suppressors "at cost" just so I could break into the 6 or more or 10 or more magic number to get ACTUAL dealer prices where I could buy a few for myself in hopes of selling them with something more than a $50 markup. So basically I'd have to give away 6 or 10 "at cost" to order another 6 or 10 at the same price so that I could try to sell them. But I had already just satisfied the most active part of the market in my zip code and provided them with an "at cost" suppressor. Never mind that if I sold the other 10 "inventory" suppressors with only a $50 markup that did nothing but offset the cost of being a SOT for that year because that's $500 a year on top of all my other operating expenses.

Sometimes it's a giant joke.

Machine guns? Boy there is a rigged market. My customers pay the exact same market prices I do. So they look around and see Uzi's are about $7,000 and then ask me if I can do better in the hopes that I'm going to somehow sell them the same Uzi but for $6,000. There is no "dealer price" on transferable machine guns but that doesn't matter. Then there is the fact that while "in transfer" I'm technically the owner so if they want to order some piece of crap at great price from some shady dealer I'm actually in the middle of that mess.

I once had a big NFA guy sell a customer a HK sear with a huge crack in it. Of course he had the customers money and it was now in my name and the customer wanted no part of it understandably, and guess who is technically the current owner. I tell NFA buyers over and over and over that "Hey I deal with these people on this really short list because they have never F'ed me over and I'm not comfortable dealing with anyone else"...only problem is reputable "you know what to expect" guys are not the cheapest game in town and everyone wants to pay $1000 less than the going rate.

It's no longer good enough to get a really great gun at a fair price. Buyers aren't happy unless they stole it, they love to brag about how they get some LNIB gun for $200 below dealer price. They really don't feel like they've done well unless they feel like they really gave somebody a good screwing. Dealers...same way...they are never happy unless they bought an M1 Garand off some old timer for $500 and then turned it around and flipped it on the net for $2500. And that is why most dealers are never happy because the opportunity to screw over both sides of the deal are harder and harder with the internet.

Guns have become cars. It isn't a good deal unless you burned somebody, doesn't matter if you are buying or selling. Nobody thinks, I paid what it was worth but it was a good deal because now I have a reliable car and the price was fair. Now car dealer is satisfied that he hardly made any money but it was fair because the car he sold had a lot of problems and there was going to be a lot of ongoing maintenance.

I got into the biz because I knew guns from the time I was a kid and even when I was 12 I was going to gun shows and negotiating my own deals. Everyone knew what the gun was worth but if it was one I needed for my collection I had no problem paying a fair price because that is just what it was worth. I didn't experience the joy of "robbing an old timer gun dealer blind and getting it for a song", I experienced the joy of researching the rifle I needed for my collection, understanding the difference between manufactures and what makes one example worth more than another example and then finally finding one and being able to add it to my collection.

And if I was a regular buyer from the same dealer and every four months bought another WWI or WWII firearm from him, sometimes I'd be offered an incentive price to buy TWO guns I needed for my collection. Sometimes I did, sometimes I didn't, it was mostly a matter of did I have that much money in my gun buying budget.

They say the internet made people and purchases less polite, probably never been more true than in gun sales.

[ThirdWatcher]

The nearest large city is over a hundred miles from me so I’m stuck with small town prices and a lack of variety. I got tired of paying twice as much for defense ammo as what it would have cost if I ordered online. In addition, it didn’t take long for me to get tired of some gun pusher trying to sell me crap that was “just good as”what I really wanted (because it was in stock).

[Arik]

That's what it takes, because if you think you are just going to sell guns ordered from the same wholesalers as everyone else...you ain't gonna make it.

Most make their biggest profits on used guns, not surprisingly, but this is where the get a bad reputation as well by offering 30% of what a used gun is actually worth. And even then it's still hard to compete with deep pocket discounters like AIM, CDNN and about a half dozen others.



And depending where you are located that might be impossible. Code and zoning requirements for a new manufactured range would blow your mind.

There's a joke about the FFL who won a million dollars in the lottery, when asked what he was going to do with the money he said he planned to keep working until it was gone.

Actually ordering from CDNN/AIM would be more for me. After the shipping and transfer fee it's not worth it when the same product here is about the same price.

Here's a recent AIM sale
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And the same at a LGS
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[teksid]

I feel lucky. I’ve got about 10-12 LGS’s within 10 miles of me.