mark-up on guns?
- Thread starter sixgunnin
- Start date
carguychris
New member
Fixed it for ya.T. O'Heir said:
FWIW the gun business is, in a way, a lot like the car business.
- The markup on inexpensive new ones is often minimal, and may be near-zero in areas with heavy competition. Usually it's only the expensive new ones that are seriously profitable for the dealer based on the sale itself.
- The key to making money on new sales is to sell accessories and convince the customer to come back later (e.g. ammo for guns, scheduled maintenance for cars).
- The markup on used ones is usually a LOT higher.
Typically 10% or so. But there are lots of variables. Bigger dealers buying by the truck load directly from the factory often get lots of price breaks and incentives including free guns thrown in.
A lot of small shops asking $500 for a gun are making much less profit than the big guys asking $450 for the same gun.
A lot of small shops asking $500 for a gun are making much less profit than the big guys asking $450 for the same gun.
g.willikers
New member
Firearms seem to have the poorest return on investment of any sporting goods.
If I were going to open a gun shop, it would be called "Everything But The Gun."
Although it would include transfers, for sure.
If I were going to open a gun shop, it would be called "Everything But The Gun."
Although it would include transfers, for sure.
My Niece works at STI.
Christmas 2015 the company offered employees their choice of pistols at cost.
She bought two (one for her hubby and one for her dad) that would MSRP in the $1800 range.
Total cost to her for both of them was $720.
To the legal fanatics, they each filled out their own 4473 on them.
Christmas 2015 the company offered employees their choice of pistols at cost.
She bought two (one for her hubby and one for her dad) that would MSRP in the $1800 range.
Total cost to her for both of them was $720.
To the legal fanatics, they each filled out their own 4473 on them.
Sorry, but I think most of you are way off the mark and I doubt you have ever run a business. I can't think of any business that can run on a 10% gross profit. I think dufus's info is about right. Thru a work connection I was able buy a major brand watch, they did it once a year for employees and friends. The price was 70% off the listed retail price. Most retailers, like Macy's, run on an average of 60% markup. Not saying there weren't exceptions but that was the usual. How do you think think can run a sale at 50% off. If your LGS only made $50 or so on a gun sale, how many guns a week would they have to sell to keep the doors open? You do the math. You can't make up for it selling cleaning supplies and cases.
ShootistPRS
New member
The suggested retail price is based on the cost to manufacture the gun, the average cost of the warehouse (jobber) plus a profit, the cost of the wholesaler and profit, the cost of the retailer plus profit and the profit in all the shipping in the various stages.
Each step has a cost and a profit margin that must be maintained. The profit margin pays salaries, lights, gas, electric, water and taxes for all the other stuff. If you think you can buy cheaper and make a living wage then I suggest you do so.
Each step has a cost and a profit margin that must be maintained. The profit margin pays salaries, lights, gas, electric, water and taxes for all the other stuff. If you think you can buy cheaper and make a living wage then I suggest you do so.
I believe that figure it based on profit after operating costs and obviously depends on the model of gun.
Owner of a gun shop I knew many years ago stated he had to sell an average of 15 guns a day (or equivalent in accessories) to break even (him, two employees, lease and other overhead). Anything after that was profit.
You know who makes a big profit, the distributors. Also known as the middle man.
Jim
I have run a small business as well as working for a small family business (not my family)
There were "loss leaders" and those things that had a 50% margin (100% markup). Volume things were one thing; others that had a lot of competition - (think gun prices versus Buds) and you'll see that sometimes, like a gun shop, you sell something for a little to get them in the door to sell them the little things with the huge markup.
What i learned from http://www.shootingsportsretailer.com/ years ago.
Manufacturer cost. Then add 100% for profit to sell it to the distributor .
The distributor adds his 40% profit , selling it to a dealer.
Dealer adds 40% for his profit, to sell at retail.
All may be discounted at times. As little as 10% profit at times. Hard to get new items , list or more. When S&W M29 were hard to find, $100 over retail was common in the 1970's.
When the orginal High Standard was in trouble, they offered , begged dealers to buy 2 gun, at distributors price. But the distributor had a lower price then the factory direct offer. They folded.
Large retail stores can buy direct from the factory, skipping the middle man.
Manufacturer cost. Then add 100% for profit to sell it to the distributor .
The distributor adds his 40% profit , selling it to a dealer.
Dealer adds 40% for his profit, to sell at retail.
All may be discounted at times. As little as 10% profit at times. Hard to get new items , list or more. When S&W M29 were hard to find, $100 over retail was common in the 1970's.
When the orginal High Standard was in trouble, they offered , begged dealers to buy 2 gun, at distributors price. But the distributor had a lower price then the factory direct offer. They folded.
Large retail stores can buy direct from the factory, skipping the middle man.
Aguila Blanca
Staff
The question for this discussion was "mark-up," not "profit."laytonj1 said:
If the mark-up on a gun is $100 and $75 of that goes to various overhead costs, leaving net profit of $25 -- the mark-up is still $100.
I could be 100% wrong here, so please let me know if I am. Gallery of Guns. Let's buy a Ruger 22/45 Lite Item # 43906. Deposit to GoG is $139.75. GoG is making money on my deposit. When I pick it up at my FFL, I pay him another $294.74 plus taxes and fees. My dealer's "mark up" is over 200%. Am I wrong?
Itsa Bughunt
New member
[QUOTEI] have often wondered what the percent of mark-up is on firearms from distributors, does anyone here have access to such distributors? How much would they sell a $500 handgun for? [/QUOTE]
They wouldn't sell to you. They wouldn't tell you how much they sell to retailers for. There's a system of distribution is place and they won't compromise it or break the law for one person.
They wouldn't sell to you. They wouldn't tell you how much they sell to retailers for. There's a system of distribution is place and they won't compromise it or break the law for one person.