I have been looking to get my FFL and a business license so i can then start selling firearms. what i don’t know yet is what the prices are that the dealers get.
My question is what are the prices that firearms dealers get compared to consumers prices?
or
how much does a person with an FFL license buy guns for?
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Josh,
When you start – you are not going to have all the accessories – grips, holsters, magazines, sights, ammo, cases etc etc etc that anyone who buys a new gun needs. You should already have developed a relationship with a local gun shop for this – and – know what their margin and mark up is. So – put this one your ‘to do’ list before your apply for the FFL.
What you need to do is buy a few copies of Shotgun News. Get signed up with some of the bigger distributors – you’ll need to open an online account and get your login and password. Some will give you limited access until you have the FFL – and – some will not give you the time of day until you provide a signed copy. Keep track of who plays nice with you. Distributors that do not play nice forget that gunsmiths are not a very loyal group – and go out of business quick.
Most FFL dealers like you are looking to start with – they will have two prices. If the buyer hands you cash – you charge $50 over cost + shipping. If the buyer gives you a down payment and you have to use even a single penny of your own money – then it is cost + 30% and shipping. If you do not charge at least 30% for a gun that ties up your money the IRS will close you down – because you are not ‘actively persuing a profit’ and they will make a determination your business is actually a hobby. Most all distributors have the guns priced so that 1.30 X cost + shipping is never more than MSRP.
So, to answer your question – the dealer price is usually 30% off of MSRP or more. Now, you never, ever want to price a new gun above MSRP unless it has compelling accessories that are totally obvious. Men will drive all around town for 5 days – waste hours of time – and $100+ in gasoline just to save $2 on a gun. Don’t ever forget this. That is why your average gun shop makes little or no money on the gun – and make all their money on sales of accessories and services.
Hope this helps.
It depends. A high volume dealer gets a darn good price break (cabela’s etc) But an average shop that sells local, really does not have much of a break on firearms. When I ws in business, we averaged $50.00 profit per firearm. Some much more than that, some less. But that was our goal. Money is really made in the accessories and gunsmithing area.
shoot safe