I'm considering starting a home based gunsmith/FFL business as a side gig (currently work full time but its not exactly exciting or time consuming). Recently separated from the Navy and had been thinking about this for a few years, just moved too much to be feasible.

The idea would be do regular transfers, NFA transfers, minor gunsmithing (think AR assembly, scope mounting, bore sighting, cleaning, etc). Mainly locally, but potential to do online sales if this works out. By appointment only, no retail sales (zoning prohibited) or walk in sales. Ideally, pop up as a close dealer on google, gunbroker, and silencershop. Transfers locally are all over $20+ at big shops, and my house would be located south of the big town with nothing nearby. I know I'd rather head to a homebased FFL rather than a big shop for a transfer. Buy used guns, estate sales, etc. Plus if sleepy Joe gets new gun control passed and people need an FFL for uppers, bleh. Plus getting arms into the hands of the people make me happy.

Mainly based out of my garage workshop and home office in my spare time. Also a way to use the home based office/business tax advantages for a lot of the stuff I would normally buy as business expenses. I've seen a few threads with specific topics or questions but this is meant to be more general, or even talking me out of it (I've spent nothing other than time thinking so far).

1. Zoning. House is zoned and allows home-based businesses, including gunsmiths and FFL. 1.6 Acre lot a few miles outside of town.
2. Establish LLC. Get FEIN. Register LLC with state. Apply for county business license. Apply for FFL. Apply for SOT after July of 2022 (or maybe this year).
3. License type: 01 since I'd likely not get into manufacturing or making anything. Vs an 07 since I could then "make" silencers, SBRs, and MGs with the appropriate SOT. Have a 3d printer and drill press at the moment. Likely an 07 and SOT to make MGs for advertising and research and devolopment.
4. Insurance. I've seen the separate threads about insurance between 4-7k/year.
5. CPA. Or bookeeping software to track expenses
6. FFL software. fastbound, etc.
7. CC processing. or start cash/check only at first?
8. Business checking/credit card suggestions? Have personal accounts at USAA, Chase, and AMEX already.
9. Website, social media, marketing, etc. Phone number via google voice, business over text/email mainly.
10. Risk of having name address posted as gun shop for theft, violence etc. Have cameras, would get monitoring, also be armed while doing business, larger safe eventually.
11. How hard to change location later if I moved? Assuming zoning etc was still good.

A quick run of the numbers seems like I'd be pretty close to or exceed the standard deduction for filing single (divorced last year), reducing my taxable income, and generate some income with fairly low effort seems like a good way to occupy my time, at least for a year or two, and get some people armed up. I'd be interested to hear your thoughts, comments, or suggestions.

Good luck to you. We started our shop as a side business, but we stay pretty busy with transfers, minor gunsmithing, and sales of firearms, accessories, and tactical gear.

Yes you are now a target to some. We don't go out of our way to advertise, but Google has brought a lot of people our way. Most seem normal enough, but there are some strange ones out there. Whoever is working in the shop is armed at all times, cameras are running 24/7, and some are visible/signage to remind people they are on camera.

Most people are happy to pay cash, but we use authorize.net via AmEx for our card processing. They aren't the cheapest, but they know what we sell and don't have an issue with it. We had one account shut down with Square. Avoid companies that are not friendly about guns. Not worth the hassle when they find out.

Once we had our license in hand I preemptively sent it out to all the major online dealers and informed them of contact info, and our hours of business. This allows customers to select you as a preferred dealer since the license is already on file. GunBroker alone has brought a lot of people our way.

 
"By appointment only" doesn't jibe with "no retail sales" or "walk in sales".....what are you going to do at that appointment?
Do you mean appointment only, because you don't plan to have 8am-8pm hours that you are open to the public?




Getting listed on FFL locators is easy. Having a premises with a million people within twenty minutes is a bit more difficult.



After you do a few thousand you may wish you could raise your transfer fees.





Does nothing nearby mean no one lives there? Thats called a recipe for failure. Where will you draw your customers from?



Why?
I'm homebased and you would be surprised at the number of people scared to ring my damn doorbell....even though they have an appointment.



As written often in this subforum, write a business plan. Remember, used guns and estate sale guns can be bought by anyone, not just FFL's. You'll face competition from every dude in the county.



You look like you've thought this through more than most.



Free parking?


You don't need to have your county business license before FFL application. Don't forget your sales tax permit if applicable.



I would get the 07 now if you intend to manufacture in the future. An 07 can do everything an 01 can do.



I've done it and it was a headache. You cant do business at the new location until your change of address is approved. Took FFLC about six weeks to switch my address.



Fairly low effort= a hobby. It takes effort and really little cash investment to do transfers. But sitting back expecting people to flock to you instead of a brick and mortar gun shop isn't the best plan.

Answers in blue. I appreciate everyone's responses. Even if they aren't specific to my situation, but a general "i would have done this different" or watch out for this pitfall.

You darn well better find out how they determine "retail sales".......because from your description that's exactly what it seems like you are going to do.
1. Generating extra traffic? Yup, thats the people coming to drop off or pick up their transfer.
2. Retail sales? Yup, thats those same people paying you a transfer fee or paying you for gunsmithing.

ATF will contact your local zoning authority or ask you to provide proof that your business activity is legal at that proposed premises.

I have a suspicion you think "by appointment" means its not a retail sale in the same manner as a a typical brick and mortar gun shop. It's exactly the same type of retail sale. There are plenty of businesses that operate "by appointment" (dentists, hair/nail salons, auto repair, etc). This is why you may need an attorney versed in your city/county zoning laws. Ask the zoning authority how they determine "retail sales" before you go one step further (in writing). Another option is a zoning variance.

Here's the zoning quote regarding home based occupations:

"6.No traffic shall be generated by such home occupations in greater volume than would normally be expected in a residential neighborhood and any need for parking generated by the conduct of such home occupation shall be met by providing off-street parking space and located in rear or side yard.

7.On the premises, retail sales are prohibited except for the retail sales of products or goods produced or fabricated on the premises as a result of the home occupation."

Gunsmith is specifically called out as an allowed home based occupation. As is direct product distribution :"13.Direct sale product distribution (Amway, Avon, Jaffra, Mary Kay, Tupperware, etc.) provided there is no production on premises." Seems the same as being a vortex or FCD dealer and selling parts would be allowed too.


The home is directly off a two lane road with a 45/55mph speed limit, so its not even in a traditional residential neighborhood. I do appreciate the feedback about it. I've contacted the business license division to see if they would issue one at the address.

That wording would seem to allow it no problem.
Good luck!

My city I operate in has the same language, was not an issue getting my business license to operate as a home based 07/02. I can’t have equipment etc all outside and can’t have people lined up like it’s a strip mall parking lot in front of my house.  Unless you think hundreds of people a day are coming, you’ll be fine.  

I appreciate it. Zoning said I was GTG as long as I meet the business license reqts. I expect 1/maybe two at a time parked in my driveway. No equipment save for a normal garage workshop. Bench, drill press, 3d printer.

I can tell you from my recent experience getting home based 07. No problem getting permit but states no walk in traffic. The ATF made me sign a statement before issuing license saying I would comply with local code. Now one code enforcement officer described that as no face to face transactions. NO sales, no transfers, no dropoffs and so on. If the ATF does a review and shows those happening in my bound book it gives them the ability to revoke. I also know another different city same situation.

No problem, you're welcome.  Unless Karen calls you in for too much traffic, you'll be just fine.

I'm not sure why they would give you a license then. The license only gives you permission to do business at the address listed. I guess maybe gunshows too?  Does walk in cover "appointments"? as in come over at 9 and pick you stuff up?

How else are you supposed to do business from home? People mail you stuff?

Completely agree and was stated that can do gun show sales and online only to be within the no walk in regulations. The whole industry both wholesalers and ATF are making it harder to run home based. Had a rep google my address and refuse to give me allocations. We have a good ecommerce site and mainly depend on it for now. Had to rewrite the business model because of it.

RSR won't allow firearms dealer accounts with home based but I do a ton of accessories sales through them so it's fine for now. Lipsey and Zanders don't care.

Do y'all have a business checking account too? In addition to a CC? I think I'll just get the AMEX blue Business cash card to keep business expenses separate and easy to track.

USAA doesn't allow business checking accounts. So do I really need a separate checking account since money would be going from personal checking, to business checking, to business CC.

Yes. We use Cap One. I have all of my personal and business accounts linked in the application which makes it really easy to transfer money back and forth.

Comingling funds from personal accounts > your business accounts isn't a good idea.
An LLC, similar to a corporation, affords some degree of protection from liability for the acts or debts of the LLC. Google "piercing the corporate veil" for how easy it is for a plaintiffs attorney to show that you personally and your LLC are really the same business entity. Poof goes the limited liability you thought you enjoyed.


Example: You make business cash deposits to your personal checking>write a personal check to your business>.........not good practice.
Business income gets deposited in a business account. Business expenses paid from business checking or business credit card.
Everyone wants to be an LLC or Corp until its time to act like an LLC or Corp, so start out right.

@OP let me know if you're near Marietta. I have a home based FFL back in Texas to do my work and transfers and wouldn't mind another. Especially if you can 07 some SBR/SBS stuff and sell it back to me

Thanks. For the time being, some of the expenses (especially at the beginning) are coming from my personal funds. I'm keeping track of them separately for now. Using a seldom used CC until business paperwork comes back.

I'll for sure get a separate checking account and CC once my LLC paperwork comes back. Even then, there would be times using my own funds to pay business expenses so there would be transfers from my personal checking to business checking.



Near is relative. I'm about 40 mins SW of the airport in Newnan.

Also, here's me being a dummy. I need to check both 01 AND 07 on the application correct? Doesn't seem like 07 covers the dealer portion, or does it?

ETA: NVM. I see that 07 covers it all. Mailing the paperwork today.

07 covers both 01 and 07. 07 has more "freedom". Also, 08 also covers "dealer". Davidson's in AZ is a 08, they can sell and import.

Thanks. Sent the paperwork yesterday. Got approved for a business CC too (Amex Blue Cash back). Once my articles come back, I'll get the checking account.

Good luck to you. Sounds like it's coming together for you.

That’s great for you, they wouldn’t let me. Lipsey’s, Zanders and several others have no issue.

There are several Distributors that require photographs from the street of your retail business.

Yes and some Google Earth your location beforehand and make a decision too.  LOL.

I am in a similar situation with applying for my FFL. Differences are that I have no zoning in my township, and one thing I didn't see you mention in the OP is where you will do business. I have a 10x30 shop attached to my garage that I am securing as my gunship. Just installed two safes and re-enforced the door. My main concern now will be separating and marking personal guns vs business guns. I plan to use one of the safes for business use/customer guns awaiting transfer.

I feel that having a separate room/building from my home will keep my family from being in the way of thieves, but my bedroom balcony overlooks the entrance to the shop to help with security.

I think its time to quit dragging my feet.

when I was an FFL they told me to mark it with a tag that says "not for sale".

Mainly out of my garage and I've got a small bonus room right off the garage door I'm planning to use as an office. I've got a small safe already for my personal guns, and will likely purchase another larger one for the business guns. I'm waiting on an actual need for more storage before buying another safe.

My LLC paperwork came back, business CC is in possession, I'm applying for the business checking now that LLC papers are back. Once the FFL (they charged my card today) is approved, I'll apply for the county business license and SOT. In the meantime, I need to work on a logo, business cards, IG/FB pages updated, and a website.

Variety of ways

1) Tag them as HB says

2) Store your personal guns in your home,  not your shop.

3) Do not have personal guns, put everything on your license.

I do #2.

As far as the by appointment only model goes, I've been trying to transition to by appointment only since last fall because of the boom in transfers and ammo sales over the last year. Being the only FFL with any ammo on the shelf caused a big uptick in referrals and business overall.
The problem is that the number of customers was causing problems with my transfers and the neighborhood. I'd have multiple guys standing in the yard waiting their turn  while I was doing transfers or sales. I tried to implement a by appointment only system way back then and got a lot of pushback from people. One guy walked in on a transfer and tried to say that by texting a generic message that he'd be stopping by at some unspecified time, he'd made an appointment. When I disagreed with him he left and hasn't been back. Another guy stood in my place and said that he was a local resident and that if he drove by and my car was in the driveway, he shouldn't have to make an appointment. And he couldn't be convinced otherwise.
Never had a problem with the long time customers who were used to me juggling a full time work schedule with the FFL business. The newer people who've come on in the last year are problematic. They seem to assume that as a smaller FFL I sit in my shed like the Maytag repair guy twiddling my thumbs waiting for them to walk in the door. They don't understand that my FFL schedule consists of one transfer after another, mixed in with ammo sales.
There's also been an increase in the number of people who think that it's perfectly acceptable to call me in an intoxicated condition at 2 AM to discuss a transfer they want to do. For the first time in nearly thirty years as an FFL I've had to fire customers this year
Edit fir the TLDR folks, there are a good number of people who will want you to have the availability ( for their convenience) of a full time FFL while getting the savings that a hobbyist FFL gets them on prices and services

Thanks. I appreciate it.

How long does the ATF take to schedule interviews/approve the FFL? Hopefully sooner than a silencer haha.

Now that you say that, it seems like much less of a concern. My personal guns will stay in the house. Just because a gun is owned by rhe business doesn't mean it's for sale. For some reason I was missing that point and most of my guns will become business property anyway.

Thanks. Not to hijack the thread, but I am on a similar journey.

Not hijacking. Its a good discussion point. I think I may end up with 2 safes

Ended up with business checking/savings with Navy Federal.

Class 3 creative gave me a decent quote for logo, simple website, business card design, but hesitant to spend that much ( a few thousand) before my FFL and business licenses get approved.

I fully understand it. I've passed on businesses solely based on a crappy website. I want to wait until all the licenses are approved

Interview with the IOI was last friday 7/9. Should be about 30 days until approval.

I wasn't sure what to expect, but the guy was about 50, long hair, beard, tattoos, wearing some type of vetbro molon labe shirt. Not sure if wearing ironically or not.

Talked mostly about the 30 item list he had to talk about and correct some items on my application. Overall painless. My dog survived.

FFL came in the mail yesterday, 7/19. Applied online for SOT. Need to send in the copy of FFL for my county business license and send copies to major online retailers. So far: gunbroker, PSA, Aim, AIM, Buds gunshop, Primary arms, Geissele.

After a few days riding the Fed ex bus, my first gun to transfer is in today, and should go out today.

Did you register with FBI NICS?

Yep. Took awhile to find the right email address. The form has the wrong one. Waiting on my registration information.

So right now its only NICS exempt transfers with a GA weapons carry license.

Who do you guys use for domain registration/web site hosting?

I went to HostGator after BigDaddy tried to deplatform ARFCOM.  I would not have anything to do w/ Google.

Thanks. I bought the domain through google and have  simple under construction message with my contact information for now. but at least the QR code on my business card goes to a real site now.