Thinking of Getting an FFL

[Dr.Wayne]

I just basically wanted it to skip the middle man from gunbroker.com and then I thought maybe I could make afew dollars in the process and get to play with some cool toys along the way. The LLC is $300, youre supposed to have insurance on your business which is $20/month, then the FFL is $200 for the basic rights. It would be cool to have, but when you start talking about $500 thats like having a new top of the line Sig P320. Can someone talk me into getting this FFL, I looked into it and I'm about 99% sure I could do it out of my home. I called the city zoning board and they said it wouldnt be a problem, and I dont have a HOA. Real issue is the $500 bucks to get it, then what exactly am I going to do with it if there is really not profit to be made on guns? What does everyone think?

[n5wd]

I think that if you're doing it to get rich, you're probably making a mistake. If you want the FFL as a way to get access to some toys that you might not be able to play with, otherwise, then maybe it's for you, if you've got a lot of time to fill.

Having a firearms business is really not very hard to do, and there aren't many insurmountable obstacles in doing so. The trick is to not spend all your money on the business before you can make some money selling things.

[OldCannon]

I just basically wanted it to skip the middle man from gunbroker.com and then I thought maybe I could make afew dollars in the process

um, no. Let me explain...there are generally two kinds of guns on gunbroker: Guns that nobody wants, and guns that everybody wants. The first kind are easy to get as a home dealer through the VERY small selection of distributors that will sell to you. Of course, what you discover is that the margins on the guns is about $1 for every $200 in cost. Then you have to remember that you're obligated to "mark up" those guns if you sell locally to the tune of 7-8.5% (sales tax). Then you get to play the "I'm stuck with this inventory" game and you decide to sell the guns on Gunbroker...for less than you paid for them. Cue the sad trombone sound.

Then there's the second kind, which you will discover that, although the few distributors you have DO indeed list them, the inventory always shows zero with an "A" next to it, which means "Allocated," which means "Unless you're buying tens of thousands of dollars of inventory from us every month, don't even ask." If you DO get lucky, then you have a good chance to sell the gun at a decent margin and make some money, but those kind of opportunities as a home dealer are rare.

If you run a home biz, the real money is in transfers. Lots and lots of them. You can also make great money by showing your inventory at gun shows, but making the REAL profit by selling overpriced accessories like MREs, nylon holsters, and old first aid kits. You can tell who the smart gun show guys are, because they stopped selling guns, but still sell MREs, nylon holsters, and old first aid kits

Also, if you can't be home all the time during normal delivery hours, you can expect heartache and angry customers. Probably both.

and get to play with some cool toys along the way.

You don't have to be a gun dealer to do that :)

P.S. - if you want to run a business that has good profit margin, open a women's shoe and accessory bag store. Just sayin.

P.P.S. - Dont get me wrong, you CAN make a profit as a home based FFL, just not really by selling guns.

[Dr.Wayne]

I just basically wanted it to skip the middle man from gunbroker.com and then I thought maybe I could make afew dollars in the process

um, no. Let me explain...there are generally two kinds of guns on gunbroker: Guns that nobody wants, and guns that everybody wants. The first kind are easy to get as a home dealer through the VERY small selection of distributors that will sell to you. Of course, what you discover is that the margins on the guns is about $1 for every $200 in cost. Then you have to remember that you're obligated to "mark up" those guns if you sell locally to the tune of 7-8.5% (sales tax). Then you get to play the "I'm stuck with this inventory" game and you decide to sell the guns on Gunbroker...for less than you paid for them. Cue the sad trombone sound.

Then there's the second kind, which you will discover that, although the few distributors you have DO indeed list them, the inventory always shows zero with an "A" next to it, which means "Allocated," which means "Unless you're buying tens of thousands of dollars of inventory from us every month, don't even ask." If you DO get lucky, then you have a good chance to sell the gun at a decent margin and make some money, but those kind of opportunities as a home dealer are rare.

If you run a home biz, the real money is in transfers. Lots and lots of them. You can also make great money by showing your inventory at gun shows, but making the REAL profit by selling overpriced accessories like MREs, nylon holsters, and old first aid kits. You can tell who the smart gun show guys are, because they stopped selling guns, but still sell MREs, nylon holsters, and old first aid kits

Also, if you can't be home all the time during normal delivery hours, you can expect heartache and angry customers. Probably both.

and get to play with some cool toys along the way.

You don't have to be a gun dealer to do that :)

P.S. - if you want to run a business that has good profit margin, open a women's shoe and accessory bag store. Just sayin.

P.P.S. - Dont get me wrong, you CAN make a profit as a home based FFL, just not really by selling guns.

I like that signature you have, you can transfer me your customers? Tactical Tone Enterprises, LLC.

[Dr.Wayne]

Approximately how long does it take from the time you submit the application till the time you are holding the FFL if everything is in order?

[Scott B.]

If you submitted everything correctly, your local/regional ATF office will schedule an IOI (industry operations investigator) visit. That's where the investigator sits down and checks to see if you're ready to be an FFL. They'll also go over the standard practices they expect you to follow. It's a good, informative process. Been through one for myself and sat in on another.

The IOI will tell you if they intend to sign off on your application. After that, it's a waiting game. Ballpark from start to finish, 30 to 60 days?

Free tip. When you send the copy of the application and fingerprints to the sheriff's office, add a note saying "ATF form xxxxx enclosed" or something similar. Had the first packet returned unopened from the sheriff's dept because we, "Didn't specify which prisoner the envelope was for." Got a good chuckle out of that.

[trashysquid]

I just basically wanted it to skip the middle man from gunbroker.com and then I thought maybe I could make afew dollars in the process

um, no. Let me explain...there are generally two kinds of guns on gunbroker: Guns that nobody wants, and guns that everybody wants. The first kind are easy to get as a home dealer through the VERY small selection of distributors that will sell to you. Of course, what you discover is that the margins on the guns is about $1 for every $200 in cost. Then you have to remember that you're obligated to "mark up" those guns if you sell locally to the tune of 7-8.5% (sales tax). Then you get to play the "I'm stuck with this inventory" game and you decide to sell the guns on Gunbroker...for less than you paid for them. Cue the sad trombone sound.

Then there's the second kind, which you will discover that, although the few distributors you have DO indeed list them, the inventory always shows zero with an "A" next to it, which means "Allocated," which means "Unless you're buying tens of thousands of dollars of inventory from us every month, don't even ask." If you DO get lucky, then you have a good chance to sell the gun at a decent margin and make some money, but those kind of opportunities as a home dealer are rare.

If you run a home biz, the real money is in transfers. Lots and lots of them. You can also make great money by showing your inventory at gun shows, but making the REAL profit by selling overpriced accessories like MREs, nylon holsters, and old first aid kits. You can tell who the smart gun show guys are, because they stopped selling guns, but still sell MREs, nylon holsters, and old first aid kits

Also, if you can't be home all the time during normal delivery hours, you can expect heartache and angry customers. Probably both.

and get to play with some cool toys along the way.

You don't have to be a gun dealer to do that :)

P.S. - if you want to run a business that has good profit margin, open a women's shoe and accessory bag store. Just sayin.

P.P.S. - Dont get me wrong, you CAN make a profit as a home based FFL, just not really by selling guns.

This was a fantastic post...super informative. I, too, was thinking about starting some kind of FFL business, but this post gave me a lot to think about...especially the $1/$200 ratio of profit/cost, and the apparent lack of wholesalers that work with small time dealers.

[OldCannon]

Just to throw more cold water on things...my "net profit" from gun sales last year was $500 (about 25 firearms sold). That comes to about $25 profit per firearm.

Now throw in your overhead cost of a monitored security system, the cost to secure/store firearms, insurance for your business, monthly fees for phone/internet, etc. -- that's no way to make a living

Truth in advertising: The theoretical "profit" comes in transfers, which have no actual cost burden on the transferring dealer. But even when factoring that in, my overall "profit" for the year was about $1100. If you want to really make money in this industry, you better be ready to SERIOUSLY hustle and sell and transfer a LOT of firearms each week. I'm lucky enough to have a full-time job that permits me to have a more easygoing pace for my gun business.

[jiannichan]

Hmm, I've been thinking about doing this for a while and thought maybe I will decide to go for it after I get a house. Now that I have a house, I told myself that I will wait until I get my office/gun room ready. I was thinking of just doing it and making money only on transfers. I figure since I work 3rd shift, it would be easy for me to schedule to have people come by to pick up their transfers. After reading this whole thread, I am really considering it now.

[Kenneth77]

I was looking into getting mine as well and after doing some looking i found on the ATF site that it said that they were not issuing anymore to people that didnt have a store front , i will see if i can find it again but thats why i said forget it .

[OldCannon]

I was looking into getting mine as well and after doing some looking i found on the ATF site that it said that they were not issuing anymore to people that didnt have a store front , i will see if i can find it again but thats why i said forget it .

Where?! This is absolutely UNTRUE!

[GeekwithaGun]

I was looking into getting mine as well and after doing some looking i found on the ATF site that it said that they were not issuing anymore to people that didnt have a store front , i will see if i can find it again but thats why i said forget it .

Where?! This is absolutely UNTRUE!

I have a friend who recently got his FFL and works out of his home.

[Ryan]

I was looking into getting mine as well and after doing some looking i found on the ATF site that it said that they were not issuing anymore to people that didnt have a store front , i will see if i can find it again but thats why i said forget it .

My personal dealer is no longer or will no longer be an FFL dealer because of exactly this. He told me that ATF will not be renewing anyone that doesn't have a B&M. And since he is not going to invest in a building, he will no longer have his FFL once it expires.

So I'm not sure who to believe or what's going on.

[loktite]

googlefu shows the current word is that ATF will not be issuing new FFL licenses to home based business, however will be doing renewals for the time being. RSR group is no longer shipping firearms to homebased or "kitchen FFL's" as of 6/21.

http://www.thetruthaboutguns.com/2016/0 ... -shipping/

**ETA** -- I too think the part about the ATF will not be issuing new FFL licenses to home based is a crock. I do believe that RSR is no longer selling to home-based FFL, but I think that's due to quantites, and not the "ATF rumor"

[Scott B.]

Be wary of 'facts' posted on that particular web site...and certainly do not take their advice on NFA requirements for marking a lower.