Do you want to start a gun shop business and want to know the cost breakdown? If YES, here are 13 factors that affect the cost of opening a gun shop. The buying and selling of ammunition is one business that is highly regulated by the government of various countries. It is a fact that if you open a gun shop, you would rake in huge returns on your investment because there are only a few people who are engaged in this line of business.
This is because the process of securing a license (Federal Firearms License – FFL) and permit to engage in this trade is demanding, and also because most countries restrict the sale of guns and ammunition to few locations and to only a few people they can easily control.
If you are looking towards opening a gun shop business, one of the major things your need to know is the locations that are ideal for the business. In as much as people consult experts to know the most ideal location to start a business, zoning of the business is still another aspect that must not be neglected.
Please note that aside from location, part of the criteria that would be used to access your gun shop is the safety mechanism that you have installed in your shop. You must ensure that your guns and ammunition are not displayed in a place where anyone can easily pick them up.
Even if you are going to display them in a glass shelve, the glass shelve must be secured enough to prevent people from picking it up. There should be other safety gadgets installed in your shop. The fact that gun powders are highly explosive makes it highly necessary to be safety conscious in your shop.
Over and above, the gun shops industry is very open for any aspiring entrepreneur who has acquired the required training, skills and perhaps professional certifications to start this business.
The Estimated Cost to Open a Gun Shop
When it comes to starting a standard gun shop business, one is expected to spend the bulk of the start-up capital on renting and equipping the store facility. You are also expected to purchase a wide range of guns, firearms, and ammunition and perhaps gun repair and servicing tools, secure the required license and permits, and pay your employees and utility bills.
In view of that, here are the key areas where you are expected to spend your start-up capital;
- The total fee for registering the business in the United States of America – $750.
- Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines, and other software) – $3,300.
- Marketing promotion expenses for the grand opening of the gun shop in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
- The cost for hiring a business consultant including writing a business plan – $2,500.
- Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – $2,400.
- The cost for payment of rent for 12 months at $1.76 per square foot in the total amount of $46,000.
- The cost for shop remodeling (construction of security tight safes, racks, and shelves) – $10,000.
- Other start-up expenses including stationery ($500) and phone and utility deposits ($2,500) – $3,000
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
- The cost for start-up inventory (stocking with a wide range of guns, firearms and ammunition and packaging materials) – $150,000
- The cost for counter area equipment – $9,500
- The cost for store equipment (cash register, security, ventilation, signage) – $3,750
- The cost of purchase and installation of CCTVs – $2,500
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephones, TVs, Sound systems, tables and chairs et al) – $4,000.
- The cost of launching a Website – $600
- Miscellaneous – $5,000
From the rough estimate as listed above, you would need a minimum of two hundred and ninety – two thousand, nine hundred and twenty USD ($292,920) to establish a small–scale but standard gun shop business in any city in the United States of America.
Please note that this is a rough estimate and we usually advise our readers who are interested in opening a gun shop to go to the market or directly contact suppliers of the types of guns, firearms and ammunitions they would need to get the real-time prices of these items.
The truth is that, if you are a good bargainer, you can get a better deal that will help you beat down the estimated price as listed above.
Having said that, here are some of the general factors that will influence the cost of opening a gun shop in the United States of America.
Factors That Will Influence The Cost Of Opening A Gun Shop
Table of Content
- The Type of Gun Shop
- The Choice of Location
- The Type of Facility
- Additional Service Offerings
- The Cost of Hiring and Paying a Business Consultant and Attorney
- The Cost for Branding, Promotion, and Marketing of the Gun Shop
- The Cost for Furnishing and Equipping the Gun Shop
- The Cost for Insurance
- The Cost of Registering the Business
- Sourcing Your Supplies and Ongoing Expenses
- Cost of Recruiting and Training Your Staff
- The Cost of the Purchase and Customizing of Uniforms
The Type of Gun Shop
A major factor that will determine the overall cost of opening a gun shop in the United States of America is the type of gun shop the owner of the business wants to start. We have strictly brick and mortar shops where guns, firearms, and ammunition are retailed, and gun shops with shooting ranges.
They basically sell small arms, such as handguns and shotguns, to individuals in an open shopping format. Other items such as ammunition and accessories for hunting are frequently sold on the premises as well, even including souvenir t-shirts.
It may also provide repairs for firearms and their parts. There are also online gun shops. The implication is that they come with different cost implications when starting the business.
The Choice of Location
Another major factor that will determine the cost of opening a gun shop in the United States of America is the location of the gun shop. In business, location is a key part of what determines the success of the business.
As a matter of fact, there are business consultants cum realtors who are specialized in helping people choose an ideal location for their type of business; a location that will guarantee them profitability and to breakeven within the shortest time frame. So, you will agree that location can influence the cost of starting a gun shop business in the United States of America.
The truth is that the location of your gun shop determines if you will be issued Federal Firearms Dealership License. Government officials must first inspect your shop to be sure that it is located in a secured location before issuing you a Federal Firearms License – FFL.
Please note that in the United States of America and in most countries of the world, zoning violations and citations can be very costly for a business. It is always preferable to comply with all zoning and land use laws before choosing a location for your business or you stand the risk of having the business closed down.
- The Required Licenses and Permits
In the United States of America, you cannot open a business without first applying for the required licenses and permits. You would need Federal Firearms License – FFL, building license, Federal Firearms Dealership License, zonal permits, and signage permits amongst others. As expected, these license ad permits cost money and will influence the overall cost of opening a gun shop in the United States of America.
Please note that you must pass several inspections before you can be issued your licenses and permits. In order to get the overall cost of licensing and permits associated with opening a new gun shop in the United States, we will advise that you reach out to your city government. You also need to consider state and federal requirements, so do your homework.
The Type of Facility
The type of facility you want to run your gun shop business from is also a major factor that will determine the overall cost of opening a gun shop in the United States of America. As regards the facility, you have the option of renting, leasing or designing and constructing your own facility from the scratch.
With renting and leasing a facility, you might just have to spend extra to modify the facility to fit into you have in mind, but there is a limit to how far you can go and it will be dependent on what the landlord of the facility wants. Let us assume that you want to construct your gun shop facility from the scratch.
It means that you will buy the land or a property, bring up your design and of course construct and equip the gun shop facility to fit into the ideal picture of a standard gun shop that you have in mind. You will agree that you are going to spend way more when compared to people that rent or lease a facility. This indeed will greatly influence the overall cost of opening your gun shop.
Additional Service Offerings
Another key factor that will determine the cost of opening and operating a gun shop in the United States of America is, of course, the additional service offerings of the gun shop. The fact that there are different types of gun shops means that these gun shops are designed to offer different services.
For example, a gun shop that operates online would offer shipping services while a strictly brick and mortar store may not. A brick-and-mortar gun shop may offer gun repair and servicing while an online gun shop may not. In essence, some of the additional services you are going to be offering will cost you more hence you must increase your budget for opening a gun shop.
The Cost of Hiring and Paying a Business Consultant and Attorney
As expected, if you want to get your business started on the right foundation, it will be a wise decision to hire the services of a competent business consultant and perhaps an attorney. A business consultant will help with drafting a workable business plan document for the gun shop, a marketing plan and strategy, a comprehensive SWOT analysis, and other advisory services that will help you with opening the business.
So also, an attorney will help you with registering the business, drafting contract documents, and offering you the legal expertise that will help you start the business on the right foundation. These services will cost you money and it will indeed influence the overall cost of opening a gun shop in the United States of America.
The Cost for Branding, Promotion, and Marketing of the Gun Shop
The cost for branding, promoting, and marketing the gun shop is yet another key factor that will determine the overall cost of opening a gun shop in the United States of America. Trust me, if you need massive results as it relates to competing and winning a fair share of the available market in your city, then you must be willing to pay for effective branding, promotion, and marketing.
As a matter of fact, it is not cheap to come by an expert in branding, promotion, and marketing that will help you compete with brands that are already determining the market direction of the industry in your city. So, if you add the cost of paying a branding and marketing expert, it will surely increase the cost of opening your gun shop.
The Cost for Furnishing and Equipping the Gun Shop
Another very important factor that will determine the cost of opening a gun shop is the cost of furnishing and equipping the facility. You will agree that aside from the basic facilities that are expected to be found in a gun shop, an investor that wants to open a gun shop may decide to spend more than expected to furnish and equip the facility to look unique.
Before you can open a gun shop, you should budget and buy bulletproofs for gun testing, safes, flat-screen TVs, sound system, DVD players, Satellite dish and decoder, office furniture (table, stools, and sofas), drawers, and cabinets, telephones, filing cabinets, educational resources, office equipment (cash register, security and fire alarm and protection gadgets, CCTV, ventilation, signage), amongst others. All these will cost money and it will influence the overall cost of opening a gun shop in the United States of America.
The Cost for Insurance
The cost of paying for insurance policy cover is yet another important factor that will determine the overall cost of opening a gun shop in the United States of America. In the United States, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from.
Thus, it is imperative to create a budget for insurance policy cover and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your own gun shop business.
The Cost of Registering the Business
The cost of registering the gun shop business is yet another cost that will influence the overall cost of opening a gun shop in the United States of America. Although the cost of registering a business and obtaining your business documents is affordable, it will no doubt add to the overall cost of opening your gun shop.
Sourcing Your Supplies and Ongoing Expenses
Another major factor that will determine the cost of opening a gun shop in the United States of America is the source of your supplies such as guns, firearms and ammunition, gun spare parts, bulletproof vests et al.
For example, if you have access to the manufacturers of the type of guns, ammunition, gun spare parts, and bulletproof vests that you need, it will sure cut down the cost of running the gun shop as against buying from third party suppliers. So also, if you have an in–house gunsmith in the shop, it will increase your profitability in the business.
Cost of Recruiting and Training Your Staff
The fact that you are opening your gun shop as a new business means that you are expected to recruit and train your staff to conform to the kind of gun shop you want to operate. The training will help you sell the corporate culture of your organization to the new employees. It will cost you money to hire expert trainers that will help you train and bring your new hires up to speed, and that will add to the overall cost of opening a gun shop.
The Cost of the Purchase and Customizing of Uniforms
Another factor that will determine the overall cost of opening a gun shop in the United States is the cost of the purchase and customizing of uniforms. As expected, your staff and security personnel are expected to have uniforms and they are expected to put these on when they are on duty. All these uniforms will cost you money which is why it must be part of your budget.
Please note that there are other factors not listed above that will surely influence the overall cost of opening your gun shop which is why we will advise that you work with a result driven business consultant in your city to give you the needed guide and info as it relates to the unique factors in your location that will influence the overall cost of opening your gun shop in the United States of America.
Frequently Asked Questions
How Do You Start A Gun Manufacturing Company?
Starting a firearms company is a much more involved process that requires a lot of small things and big things. It doesn’t really work like starting any other business. To start with you need to look into the laws in your area and maybe consult a lawyer, then you need to look at your zoning regulations.
Once you have an address, you need to contact the ATF and start paying the fees and getting all your red tape cut. You also need to file your articles of incorporation. You can also file an LLC to protect your personal assets. You need to get your milling machines, lathes, potentially even CNC machines. Next you consider money for overhead (your electricity and other bills – your materials would be considered overhead) and part of that is labor. Then you need to start seeking out customers.
2. How Can You Start A Gun Business?
- Find a location
- Get a license
- Maintain Records
- Conduct Background Checks
- Advertising and Promotion
3. What Would I Need To Start A Firearms Manufacturing Company?
- ATF license to manufacture firearms
- Your Location
- Getting FFL Approval
- Building, with material storage and room
4. How Can You Start A Firearms Business?
- Find a niche
- Do your homework
- Engage a Lawyer
- Get Insured
- Get the word out
5. Can You Run A Gun Shop Business Near A School?
No. There is a statute establishing gun free school zones
6. Can You Run A Gun Shop Business From Home?
Yes, in some states. And only if you run it strictly online.
7. How Do You Legally Start An Ammunition Business?
The ATF lists nine different types of federal licenses and several for dealing in explosives and ammunition. Before you apply, you need to know whether you want an ammunition vendor license or one to sell destructive devices.
Most licenses don’t allow the licensee to trade in or make destructive devices. Here are some of the licenses available:
- Firearms dealer
- A pawnbroker’s licenses for dealing in firearms
- A collector of curios and relics. This license lets you buy guns as a collector
- An ammunition vendor license. This does not allow you to manufacture armor-piercing ammunition.
- Gunmaker license
- Firearms and ammunition importer license
- If you deal in explosives, there are separate licenses for selling, manufacturing and importing them.
8. How Do You Start A Firearms Production Company In The United States?
If you can legally get a license, then you can start a firearms production company. This is actually the most complicated part. Once you have a license, you can start your firearms production company just like you would start a normal business. But note that not everybody gets given a license.
If have a letter from your landlord, a letter from the zoning board, are in a manufacturing zoned area or an unzoned area, then you can get an 07 FFL. The ATF offers the 07 FFL for manufacturing for only $150 per 3 year term but charges $200 for an 02 FFL for gun smithing.
9. How Do You Start A Weapon Development Company?
This is the sector with probably the heaviest regulation of them all when it comes to arms and ammunition. Starting a new business would take lots of capital and big lobbying budget, great connections, strong partnerships in government, research organisation and existing incumbents, and flawless security record.
Without approval from defence department, it’s basically impossible. But if you’re very rich, you can fund the defence department so you can be granted a license.
10. How Much Does It Cost To Open A Gun Shop?
200k is a good amount to use to become a well stocked dealer with a nice selection of guns, accessories, and ammo and reloading supplies.
11. How Can You Start A Legal Business Related To Guns?
Certain businesses will not even need a special licence. If you are only producing accessories that are not regulated like pistol sights, rails, magazines, cases, locks and so on, you will operate just like any other business, and you can start just like every other business.
Some of firearms industry is regulated, and you will need some sort of license. For example the manufacture, import, distribution or sale of firearms all require a licence. Lastly, not all persons are allowed do do business with firearms. It will depend on your immigration status, mental health history, criminal history and so on.
To start a legal business relating to guns, you need to;
- Learn the Law
- Attend Gun Shows
- Join Industry Associations
- Write a Business Plan
- Purchase Insurance Coverage
- Market the Business
- Hold a Grand Opening
12. How Can You Start Manufacturing Defense Ammunition?
This business is not available to private individuals
13. Can Gun Store Employees Open Carry?
Yes, gun store employees in the United States are quite often all armed and more or less allowed to open carry.
14. What Is The Estimated Amount Of Capital To Start A Gun Store Business?
Entrepreneur.com estimates the initial start-up costs for a gun store to be between $10,000 and $50,000. The cost will largely depend on commercial retails costs in your city though.
15. How Do You Start A Gun Manufacturing Business In India Legally?
The manufacture of arms and ammunition is presently regulated under a licensing system established by the Arms Acts (1959) and Arms Rules (1962) and is under Government domain in India. The manufacturing of Small Arms for armed forces/paramilitary forces/police, are confined to the Department of Defence Production.
Even after liberalization of the Indian economy and removal of licensing regime for major industries, the private sector is not allowed in this sector.
16. How Can You Market Your Online Gun And Ammo Store?
Because most social media and paid media ad platforms, like Facebook and Google, prohibit advertising campaigns for gun sales, you’ll need to focus your efforts elsewhere. You can advertise your online gun shop using SEO, which optimizes search engine results so that your store reaches the top. Content marketing is especially useful for improving your site’s SEO; consider writing blogs that gun enthusiasts may find valuable.
When it comes to offline advertising, you do not have much options available to you except referrals.
17. Who Are The Best Suppliers Of Firearm Products?
- Glock Ges. m.b.H.
- Smith & Wesson
- Sturm, Ruger & Company, Inc.
- Sig Sauer
- Savage Arms
- Springfield Armory, Inc.
- Heckler and Koch
- Winchester Repeating Arms Company
18. What Kind Of Profit Percentage Does A Normal Small Gun Shop Usually Make From A Brand New Gun?
In most gun shops, the markup is 10% to 35% for new and used guns. Many pawn shops are making 50% to 100% profit on their firearms. But in all, a lot of the profits depend on the owner.
19. Who Can Sell Firearms On The Internet?
Independent gun store owners and manufacturers can sell their firearms online.
20. How Much Would Be The Estimated Amount To Start This Kind Of Business?
Entrepreneur.com estimates the initial start-up costs for a gun shop to be between $10,000 and $50,000. The cost will largely depend on commercial retails costs in your city.
21. Why Is Selling Your Firearms Online A Winning Strategy?
Selling straight to your clients is a fantastic way to guarantee that the qualified taxpayers who desire your firearms can purchase them. By simply setting up an online shop for your guns, you might improve your reach and start an untapped revenue flow.
Not many traders sell, take, or have access to each firearm you create, nevertheless by adding local FFL’s from the logistics, a client will have the ability to pick their firearm locally and also offer an inventory to the retailer via ancillaries such as ammo, instances, cleaning kits, etc