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7/29/2014 4:02:36 PM
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ReallyLongAction
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Posted: 12/29/2010 10:41:26 AM
We've talked , many times, about the profit margin (or lack thereof ) on firearms. But, whats the profit margin on ammunition , and gun accesories like cleaning supplies, holsters, etc?

The reason I ask, is that I was at a gun show the week before last, and notiiced the "ammo guy" was , as usual, "ass & elbows" busy. By far, he was the busiest guy at the gun show. I thought to myself "Boy , he must be raking in the money".


I'm not asking this question because I'm planning on starting a business, or anything. I'm content in my present line of work. I just started wondering how much of average markup there was on that stuff.
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Posted: 12/29/2010 10:43:25 AM
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Posted: 12/29/2010 10:43:44 AM
It might be a bit complicated to give a short answer to a question like this.

I would assume that the discount structure for dealers depends on the volume of business they do with the manufacturer or distributor/supplier.

I've wondered about getting my FFL in order to get discounts.

I'm interested in the answers you might get to your question.
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Madcap72
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Posted: 12/29/2010 11:01:54 AM
15% markup on guns, 30% on accessories is about "Normal".


The store I worked at was 29% (at or over MSRP for most guns) on guns and 40-60% on accessories, working on the "Sucker born every minute" price structure. It had started at 22%, then creeped to 29 during the Obama scare. Problem is, they never dropped price when the scare went away.

If you find a gun at a store for sale priced at the MSRP, you're getting gouged a fair amount.
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strat81
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Posted: 12/29/2010 11:02:17 AM
My guess is that it's probably too difficult to answer.

Looking at gun shows, the web, and retail stores, prices are all over the place for any given product.

Dealer costs probably vary based on volume, closeouts, specials, etc.

Overhead will vary based on business model, locality, and business acumen.

One company, IMO, that has a great business model is AIM Surplus.
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Posted: 12/29/2010 11:03:44 AM
After visiting some of the small-town gun shops across the US.........I'd say about 140%
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Madcap72
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Posted: 12/29/2010 11:04:41 AM
Oops, that was sort of a canned answer.


Ammo, probably 20-30% Mark up, just really depends. If the ammo guy is paying employee's then it cuts into the net.


Retail small business really does not pay that well, it's definitely more about being your own boss.

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riflecrank
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Posted: 12/29/2010 11:15:05 AM
If your thinking about making a kill'in in the firearms business your dreaming. The market is flooded with every conceivable accessory and part. Profit margins are very low and competition is extreme. In the firearms business people think that they are getting ass raped if you have a 25% profit margin. Not to many places can stay in operation at that profit level.
AeroE
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Posted: 12/29/2010 11:27:05 AM
We have one store here that sells very few guns due to the low margin, not to mention market saturation right now. They make their money on accessories and reloading supplies, and that is an intentional plan.

Here's an example that is one gauge. I can buy Ruger 10/22 magazines for just under $12 each wholesale. The lowest retail price I know is $16, and I saw one for $22 yesterday.

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DesertStormRanger
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Posted: 12/29/2010 11:33:03 AM
Originally Posted By riflecrank:
If your thinking about making a kill'in in the firearms business your dreaming. The market is flooded with every conceivable accessory and part. Profit margins are very low and competition is extreme. In the firearms business people think that they are getting ass raped if you have a 25% profit margin. Not to many places can stay in operation at that profit level.


I am in the IT hardware business and 5 percent margin is considered above average. We are talking 60k items as well not a 10 dollar box of ammo

ReallyLongAction
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Posted: 12/29/2010 11:39:07 AM
Originally Posted By riflecrank:
If your thinking about making a kill'in in the firearms business your dreaming. The market is flooded with every conceivable accessory and part. Profit margins are very low and competition is extreme. In the firearms business people think that they are getting ass raped if you have a 25% profit margin. Not to many places can stay in operation at that profit level.


Not me. I'm happy where I'm at. I was just curious, thats all.

EFB16ACRX
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Posted: 12/29/2010 11:42:29 AM
15% seems average on guns. Ammo varies but around 20-25%. Accessories vary wildly. Some stuff like holsters its way up like 75-100% some stuff its almost nothing.
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EFB16ACRX
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Posted: 12/29/2010 11:44:31 AM
Originally Posted By AeroE:
We have one store here that sells very few guns due to the low margin, not to mention market saturation right now. They make their money on accessories and reloading supplies, and that is an intentional plan.

Here's an example that is one gauge. I can buy Ruger 10/22 magazines for just under $12 each wholesale. The lowest retail price I know is $16, and I saw one for $22 yesterday.



keep in mind some dealers like to only deal with one distributor whether or not they have the best prices on anything. Why, I dont know. When i was working at the shop down the street i tried to save him money all the time but he liked getting everything from 2 places.
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sigp226
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Posted: 12/29/2010 11:57:02 AM
Originally Posted By Madcap72:
15% markup on guns, 30% on accessories is about "Normal".


The store I worked at was 29% (at or over MSRP for most guns) on guns and 40-60% on accessories, working on the "Sucker born every minute" price structure. It had started at 22%, then creeped to 29 during the Obama scare. Problem is, they never dropped price when the scare went away.

If you find a gun at a store for sale priced at the MSRP, you're getting gouged a fair amount.


That depends on the maker. Some put the MSRP fairly high, which then means that the buyer is eating a large chunk of Pittman Robertson, even if he buys the gun at a discount. Some other makers list an MSRP for their guns at 15 or 20%. Nighthawk, LWRC, and Les Baer are a few who publish a very low margin MSRP.

Regarding ammunition, expect around 30%. Optics and mounts run about the same. Cleaning kits and other stuff are marked up more.

Some asshole is going to start crying about the nerve of stores to seek a 30% margin on ammunition. They're making too much money. I refer these people to the gun department at The Salvation Army.
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PAEBR332
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Posted: 12/29/2010 12:01:38 PM
Gross or net?

HUGE difference between those two.
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Lungbuster
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Posted: 12/29/2010 12:19:31 PM
i just bought a Benelli shotgun, the owner of the store told me he profited $16.00 from the sale.
ReallyLongAction
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Posted: 12/29/2010 12:54:03 PM
Originally Posted By PAEBR332:
Gross or net?

HUGE difference between those two.


Fair point. I know that he doesnt have a storefront , and I never see anyone but him working his table , so I dont think he has any employees.

Scince the guy only sells at gun shows, and he's a one man operation, I'd have to think his overhead is (relatively ) low.
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Posted: 12/29/2010 12:55:58 PM
I don't shop at dedicated gun shops anymore because the markup is so high. I shop for ammo at Walmart or online (PSA) or at my local Sportsmans Warehouse. Sportsmans has had some unreal killer deals on guns lately. Too bad I havent had the cash to buy any!