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Old 01-19-2015, 10:39   #1
The Gun Slide Guy
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Choosing inventory for a new retail gun shop.

If you had $100,000 to purchase inventory for a new gun shop what would you stock initially?

Additional info- Shop would be located in Southwest Missouri, so you need to cater to the concealed carry crowd, the deer and turkey and waterfowl hunters as well as the tactical crowd.

NOT including accessories and related items, what FIREARMS would you stock? With the goal of economic viability in mind. Keep in mind, you need the shop to succeed, so we shouldn't just stock what WE like.

Post a master list, or just a few must haves.
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Old 01-19-2015, 11:28   #2
DaleGribble
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Quote:
Originally Posted by The Gun Slide Guy View Post
If you had $100,000 to purchase inventory for a new gun shop what would you stock initially?

Additional info- Shop would be located in Southwest Missouri, so you need to cater to the concealed carry crowd, the deer and turkey and waterfowl hunters as well as the tactical crowd.

NOT including accessories and related items, what FIREARMS would you stock? With the goal of economic viability in mind. Keep in mind, you need the shop to succeed, so we shouldn't just stock what WE like.

Post a master list, or just a few must haves.
I think I'd want more than 100K of my own money to open up a gun store in this time of reduced demand.

Either way, good luck and I hope your store is tremendously successful for you.
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Old 01-19-2015, 11:35   #3
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Yeah, I would say this is absolutely the wrong time to be getting into the gun selling game. It can only go down-hill from here, and I'd even say it has started going down already.
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Old 01-19-2015, 11:56   #4
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Kinda up to you, to be honest. What kind of population surrounds you? If you're in an area with a decent number of people that have a lot of money, and there's no gun store that caters to them, you can possibly get away with trying to grab their business and selling higher end stuff. You could also have an online presence. Osage County Guns is a pretty well known gun dealership due to their online presence.

If you're in an area where there are a lot of middle class people, stock up on GLOCK, XD, Ruger, and S&W pistols, maybe stock an "I like it so I'll try to sell it" gun like an HK or two, but don't put a shelf full of HK45s out in an area where the mean income is $20,000 a year, or you're going to be working against yourself.

If I had the means to open a gun store, and had $100,000 to work with, I'd spend $10k on guns to stock on the shelves, set the rest aside for operation cost, and become known as the "I can order it for you" guy.

Put some XDs, GLOCKs, the middle of the road service pistol plastic fantastics we talked about on your shelves, stock a few Ruger 1911s, a few Rock Island 1911s, some 870s and Mossberg 500s, some Marlin .22 rifles, a 10/22 or two, maybe some Ruger American in .308, 7mm, and .243. That will cover you for the folks walking in off the street who don't know a ton about guns, they can get an affordable, quality gun and you've helped them protect their household and/or get interested in shooting as a hobby. Good karma, yay.

The folks coming to check you out who are already into guns may ask you "Hey, do you plan on stocking any Sigs or HK in the future?" You can tell them, "I can order you any gun you want. You want an HK Mark 23? I'll have it here by next Tuesday."

You want to keep low inventory on the shelves and move what's there. I'd stock up with a middle class buyer in mind and establish myself as a guy who can get you anything with people looking to spend more.

As far as lower end guns go, I want to throw this out there and let you think about it:

-Hi Points will probably move off the shelf quickly. Be honest and tell the customer that it's not a high volume shooter, but it is a solid choice for no-frills protection, and they will probably sell (I know a few folks in the gun selling world who say they sell more Hi Points than anything).

-Never, ever, ever sell a Taurus handgun. Look at me. Focus. *snapping fingers* Don't do it. You can carry their revolvers and sleep at night, ok? The revolvers are decent. Don't ever carry their auto loaders. Don't ever sell anyone a Taurus 1911, lest the gods of gun dealerships smite thee with great fury.

EDITED: I'd also like to re-state that to make it, you're almost absolutely going to have to have a super strong online presence.

Last edited by s&wfan; 01-19-2015 at 11:57..
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Old 01-19-2015, 12:05   #5
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Think about this..
Two reasons businesses fail:
1. Undercapitalization..where I think U R
2. Do not know enough about the business..
Under these conditions it is a dream and hobby, not a business.
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Old 01-19-2015, 12:08   #6
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That isn't nearly enough money.
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Old 01-19-2015, 12:10   #7
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I would do some research into the types of guns that are sold well in that specific locale. If it's the hunting type then stoke up on shotguns, bolt action, lever guns, etc.

If it's the tactical type then, well, you know what I mean.

Cater to your prospective clientele.
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Old 01-19-2015, 12:10   #8
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Yeah, I would say this is absolutely the wrong time to be getting into the gun selling game. It can only go down-hill from here, and I'd even say it has started going down already.
Yes, bad timing.

Ammo and gun prices are coming down.

There will be a shake out in a lot of areas. All those new AR mfgs that popped up will have difficult time.

Most things can be bought on line for less then a gun shop.

If a gun shop doesn't have a good gun range, they will have a hard time surviving.
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Old 01-19-2015, 12:17   #9
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Where I live sounds a lot like where you are. Rural and not much money.

As stated above, I don't think it's a good time to open a retail shop. There's just little to no money in it and lots of financial risk. It's also a time where everyone is racing to the bottom.

Seems like virtual store fronts are the easy way to get into the business. Not much more that I can add that what wasn't started above.

You buy a domain name, create a web page, and then hook up with a large wholesaler who handles the inventory and shipping. You just have the gun shipped to you when ordered and then forward it on to the buyer's FFL.

You can also make money in transfer fees. Folks that order online need to have the weapon come through an FFL. Just have it shipped to you and charge $20-25 for the back ground check.


But if you really wanted to have a shop, you'll need to stock what sells. Around here, that's cheap hunting guns around hunting season, Hipoints and Cobras always on hand, and more used guns than new all the time.

Maybe around tax time you could stock a few revolvers, 1911s and black rifles.

Depending on your market, Glocks are always a sure thing but the mark up is small.

As the previous poster said, you can also position yourself as the guy who can order everything else.

That being said, if you can order it then so can I, the end user. I might even be able to beat your price after shipping and transfer fee.

Unfortunately for retailers, the internet and local gun trading forums are gradually putting them out of business. Even service doesn't mean much when ultimately the owner can return a gun directly to the manufacturer for warranty work.


My understanding is that mark up on all guns is fairly small. Any real profit is made through accessories. Again, a savvy shopper is just going to hop online for what they need.

Last edited by longbedbob; 01-19-2015 at 12:22..
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Old 01-19-2015, 12:21   #10
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Very tough question but will give some insight:
First do some market research ( accept you will not please everyone) and figure out what demographic is going to recurrently spend money in your shop ( weekly target shooters are going to be the key here- figure out if idpa/ipsc is popular in your region or is sporting clays/ trap?) and tailor the inventory to these types.
Second you need to set yourself apart. In my region there is one big independent gun shop that is very well stocked ( millions in product) they have to have thing in stock to bring customers in instead of going to cabelas and gander mountain.
It is definitely a hard time in the gun business unless you have a niche
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Old 01-19-2015, 12:24   #11
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Follow up - my experience is if you have limited inventory but still operate a store front and play the "I will/can order it" game you will fail.
On site gunsmithing is big too.
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Old 01-19-2015, 15:30   #12
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I will tell you what moves well in our area, according to the LGS where I shoot. Understand, he is a range first and foremost, with a decent selection of firearms as well.
#1. 50% of the handguns and long guns on the rack are used consignment sales. He found out having a lot of new inventory sitting on the shelves is a good way to not make payroll.

#2. Ammo is the leading seller, and is very much dependent on the seasons. Back before deer season opened he bought 2k in .308, .270, .3006, .243 and 7mm Rem., all two and three boxes of different brands and bullet weights. Within two weeks he had sold all of it. When he re-ordered, he went heavy on shotgun turkey loads and deer slugs, with a few few of the more common .308 and 7mm Rem. cartridges. He still has half of them on the shelves, as most deer hunters buy a single box for the entire season.

#3. Good quality handguns at below 400 prices. Rugers abound, and are the hardest thing for him to keep in stock. Saturday I suggested he look into the Canik, said he will check them out. He had some Shields, said they move really well.

For our area, Glocks are not a big seller, has the same G17 and G21 he originally bought when he opened last February.

#4. Make sure the clientele know you can get anything they want, as a special order, 100% down at time of order. He had a Contender .243 sit for 5 months because someone ordered it and changed their mind. That is a chunk of change to have tied up on a single inventory item.
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Old 01-19-2015, 15:44   #13
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The gun shop I work at is also a range. 95% of customers come into the shop to shoot and then look around. Our biggest seller is the shield by far and then small pistols, glock 42, lcp. We don't sell a ton of glocks or S&W M&P but I think there is very little mark up on those guns. People also like to buy .22s
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Old 01-19-2015, 16:52   #14
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I worked in a gun shop in the past. One of my duties was ordering new stock from the distributors. You wont make much money from new gun sales. The markup isn't there. The real profit margins are on used guns. Nowadays many local shops keep good used guns off the shelves and list them on Gunbroker. They get far more money online than they would from the locals. These are tough days for small shops. You need to keep overhead down. It's tough to pay rent and a few employees based on gun sales. I had an owner of a local shop tell me he was selling around 100 guns a week during the recent panic. Now it's 15 a week if he's lucky.
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Old 01-19-2015, 17:19   #15
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I interviewed at my LGS a while back. Very interesting discussion.

My LGS (and it is doing OK, so I assume these comments are industry standard) doesn't make their money on weapon sales. The margins are too thin, thanks to internet sales. Ammo used to be a profit area, but reduced availability has limited THAT revenue stream.

So the store's profit areas are the accessories - the holsters, gun cases, cleaning supplies, all the ancilliary stuff.

But the REAL income is in the pawn area -a continuing source of stable income-with a lot of returning business. You may want to consider adding a pawn option to generate revenue.
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Old 01-19-2015, 17:39   #16
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But the REAL income is in the pawn area -a continuing source of stable income-with a lot of returning business. You may want to consider adding a pawn option to generate revenue.
A couple of things have even changed the pawn business - TV

Storage Wars

Pawn Stars

People are bidding up storage auctions.

Pawn Stars have caused a lot of people to bring in fakes and junk. You really have to know your business and where the profits are - people that pawn stuff and don't pick it up. I think the pawn business also needs an internet/Ebay presence to move the stuff.
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Old 01-19-2015, 18:01   #17
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I wonder how things work between the distributors and the dealers. I have to guess that some guns may be more easily ordered in multiples and that it may be easier to get some XXX if you also order a few YYY guns. The range that I frequent has a couple cases of guns. They seem to keep popular handguns, similar to what I would expect would be what someone wants as their first or second handgun; Glocks, Springfields, Rugers, S&W M&Ps or J frames, that type gun. They also have a few Springfield 1911s including a TRP once in a while. My sense is they have some sort of special relationship with Springfield as a couple years ago they had the big Springfield show truck come there for a day. A TRP would typically be the most expensive pistol they would have at what I would guess is about twice what their average gun is. One day I went in and they had a Sig X Five in the case, the (a?) bright blue one. I asked them about it and they said the owner wanted one so they got two.


I wish you the best with the business and I am guessing that inventory will not only be complicated from the customer standpoint but also from the distributor standpoint.
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Old 01-19-2015, 18:11   #18
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Quote:
Originally Posted by Pier23 View Post
I interviewed at my LGS a while back. Very interesting discussion.

My LGS (and it is doing OK, so I assume these comments are industry standard) doesn't make their money on weapon sales. The margins are too thin, thanks to internet sales. Ammo used to be a profit area, but reduced availability has limited THAT revenue stream.

So the store's profit areas are the accessories - the holsters, gun cases, cleaning supplies, all the ancilliary stuff.

But the REAL income is in the pawn area -a continuing source of stable income-with a lot of returning business. You may want to consider adding a pawn option to generate revenue.
Used guns usually make for good profits. Unlike NIB guns where everybody and their brothers know what the dealer costs are, used guns are kind of up in the air.
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Old 01-19-2015, 18:13   #19
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I wonder how things work between the distributors and the dealers. I have to guess that some guns may be more easily ordered in multiples and that it may be easier to get some XXX if you also order a few YYY guns. The range that I frequent has a couple cases of guns. They seem to keep popular handguns, similar to what I would expect would be what someone wants as their first or second handgun; Glocks, Springfields, Rugers, S&W M&Ps or J frames, that type gun. They also have a few Springfield 1911s including a TRP once in a while. My sense is they have some sort of special relationship with Springfield as a couple years ago they had the big Springfield show truck come there for a day. A TRP would typically be the most expensive pistol they would have at what I would guess is about twice what their average gun is. One day I went in and they had a Sig X Five in the case, the (a?) bright blue one. I asked them about it and they said the owner wanted one so they got two.


I wish you the best with the business and I am guessing that inventory will not only be complicated from the customer standpoint but also from the distributor standpoint.
Usually a shop would have a few high falutin' guns to act as dude magnets. They'd come and ooh-aahing over the guns but end up buy a bunch of lesser guns. No difference from a car dealer having some sweet Corvettes in the showroom so that they guys buying pickups, sedans and mini-vans can go ooh-aahing about.
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Old 01-19-2015, 18:16   #20
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I was at a gun show in Florence SC last week. I talked to a few dealers about gun sales etc. That was my second show I attended that weekend. I was trying to find a Wiley Clapp GP100. I was surprised I couldn't find one. I mentioned this to a couple of the dealers. They said they have really scaled down their inventory of new guns. Especially guns that aren't fast movers. They said online sales have really hurt them. They can't compete with the pricing. They said the big guys online might be selling guns for just $15 or $20 bucks above cost. Local shops can't match those prices. I drove several hours that weekend and paid $16 to enter the shows looking for my gun. No luck. I went home Sunday night and got on Gunbroker. I had my gun purchased in 15 mins. I like to support the shops but buying online really is convenient.
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