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Old June 18, 2010, 04:15 PM   #1
SimpleTexan
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Is another online store needed?

Hey everyone - this is my first post, so hope I'm doing it right.

I am thinking about getting my FFL and opening an online store to sell new handguns. I know the rules and will run a physical presence out of my home in the evenings, although my focus would really be on Internet sales. I would run an up & up business, have a business license, get approved by the city to run a business out of my home, establish an LLC, and set up wholesale accounts with the major distributors.

My question is, is there a need for this business? I've seen various online sites where one could buy a new handgun, but I think I could run a good business. My goal would not be to undersell everyone, but to offer great service and good prices. I wouldn't expect to get rich by any means, but to hopefully make a decent second income.

Thoughts?

Thanks in advance,

Ken
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Old June 18, 2010, 04:29 PM   #2
teumessian_fox
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The only "need" for such a business would be if you could sell at such a loss that it would make it a bargain for buyers.

Seriously, the margin on firearms is so low as to not make it worth your while. If you specialized in used, the internet has made everybody so aware of gun prices that even that market is doubtful.

Maybe accessories?
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Old June 18, 2010, 06:39 PM   #3
Brian Pfleuger
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I doubt that there's a "need" for such a business. The internet is already LOADED with firearms sellers.

That said, if you're just looking for a side-show, sort of a hobby,not your main source of income or, on the opposite end, if you have tens of thousands of dollars to immediately establish a large availability and high-volume prices then you might be able to make a go of it.


Side note, I personally believe that an FFL is worth having for your own personal use. If you pay a dealer for 3 or 4 guns over the life of the term of your would-be FFL then you'd be better off to just have your own. Not to mention the discounts that many business, like MidWayUSA, give to FFL holders and the fact that you will not only not be paying transfer fees but also be getting direct pricing on your guns.

I just began the process myself.

BTW, you don't need to "run a physical presence out of your home in the evenings". All you need is a physical address that is the home base address at which to do business. ATF doesn't care if you're open 150 hours a week or 0. The only thing that matters to them is that the address at which your FFL is registered is a place where it is legal for you to run a firearms business.
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Old June 18, 2010, 07:38 PM   #4
ScottRiqui
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Quote:
The only "need" for such a business would be if you could sell at such a loss that it would make it a bargain for buyers.

Seriously, the margin on firearms is so low as to not make it worth your while. If you specialized in used, the internet has made everybody so aware of gun prices that even that market is doubtful.
Agreed - the margins for new guns are so razor-thin because as a seller, there's not much you can do to "add value" to the transaction for the customer.

The 1911/Sig/Glock/Whatever you sell is going to be fundamentally identical to what everyone else is selling, and thanks to the internet, customers know what everyone's price is.

Unless you become a factory-authorized service center, you can't handle warranty claims for the customer, so you're going to have to send your customers to the factory, just like all the other sellers.

Customers aren't going to fork over 20-25% over cost just so a seller can take a gun off a shelf and hand it to them.

I got out of the custom computer-building business years ago for the same reason - it largely turned into a commodity market, and when the parts you're offering are the same as the parts everyone else has access to, it's hard to differentiate yourself.
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Old June 18, 2010, 07:49 PM   #5
rjrivero
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VOLUME

With the margins on firearms so low, the only way to make a living selling them is by sheer numbers.

200 guns a day keeps bud's gun shop the fore-runner in online sales.
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Old June 18, 2010, 08:14 PM   #6
SimpleTexan
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Thanks.

Thanks for all the replies. I guess I pretty much already knew what everyone said, but wanted to make sure. I've wanted to set up an online business for some time, and I started wondering if combining that with my liking of handguns would make sense. I'm thinking not really at this point. I'll just keep thinking of other ideas!

Thanks again.
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Old June 19, 2010, 12:08 PM   #7
poison7fl
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Also, it is very hard to set up an "online only" gun store. 99.9% are not approved. The ATF rarely approves FFL's without storefronts anymore.
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Old June 20, 2010, 08:00 PM   #8
dogtown tom
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Quote:
poison7fl ....Also, it is very hard to set up an "online only" gun store. 99.9% are not approved.
Uhhh......if you mean a gun store that exists only in cyberspace, then it SHOULD BE 100% are not approved. Federal Firearms Licenses are issued to a single physical address. No physical address for the licensed premises? No FFL.

The overriding requirement of qualifying for a Federal Firearms License is that the applicant have a "licensed premises". Meaning the FFL that plans to sell firearms via internet or mail order sales only needs to have a licensed premises where all records are kept. Such licensed premises is not required to be open to the public, but "business hours" are required- meaning hours that the FFL will devote to his firearms business. (these are also the hours that ATF will use when you have your compliance inspections.

It is easy and common to make online sales only- as long as the FFL has a licensed premises. I have yet to sell a single firearm from my licensed premises or at a gun show- all my sales are strictly online through GunBroker, etc.

Quote:
poison7fl ....The ATF rarely approves FFL's without storefronts anymore.
Absolutley horsepoop.
This internet myth gets repeated so often that people start to believe it.

ATF doesn't give a rats hiney whether the applicant has a storefront or not- as it IS NOT REQUIRED by any ATF regulation or Federal law. What ATF DOES care about is whether the proposed licensed premises will be operating legally under all state, city, and local laws and requirements. (meaning if you aren't zoned for a home business or fail to obtain sales tax or business permits you're outta luck)
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Last edited by dogtown tom; June 20, 2010 at 08:12 PM.
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Old July 26, 2010, 08:35 PM   #9
steelbird
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Specialization?

If I had the cash, credit, etc etc etc....
I was thinking it would be kind of interesting to set up a store that specialized with archaic firearms and weaponry - with nothing more advanced than percussion type long arms and small arms. Civil War repros, flintlocks, and so on. I'd also include edged weapons, crossbows, large longbows, and maybe small versions of and plans to build of siege weapons like catapults, trebuchets, and the ballista. Maybe throw in some clothing, accessories, etc. Service would come from having knowledge of these things and how they work - since so few people actually know what a trebuchet is, to begin with.
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