Gun control is one of the most controversial topics in the United States today. However, opening and operating a retail business that buys, sells and trades guns still has the potential to be profitable. In addition to selling guns, most gun shops also sell ammunition and hunting-related products and sometimes offer a gun repair service and a shooting range on site.
According to 2018 data by IBIS World, despite the industry's volatility in recent years, the gun business in the United States is worth $17 billion, has an annual growth rate of 2 percent and employs over 50,000 people.
Finding a location
To get started, you'll either need a loan or funding to purchase or lease a store, or you might consider buying an existing gun shop if one is available for sale in your area. Entrepreneur.com estimates the initial start-up costs for a gun shop between $10,000 and $50,000. The cost will largely depend on commercial retails costs in your city. While you won't be able to run a gun shop without a license, the application for a Federal Firearms License will ask where you plan to sell your guns, so you'll need to find a location first.
Certain counties restrict where you can open a gun shop, so be sure you know your local laws before finding a spot. In California, for example, new gun stores cannot be within 500 feet of schools, day-care centers, residential areas, liquor stores or other gun shops.
Getting a license
Your next step will be securing a Federal Firearms License or FFL. Submit your application and pay the fee, which will cost between $20 and $200, then the ATF will need to run a background check on you. This will mean investigating every aspect of your life to ensure that you can be trusted with the crucial responsibility of buying and selling firearms. If you've ever violated a firearms law or been convicted of a felony, you will be denied your FFL.
Federal law requires licensed firearms dealers to maintain records of gun sales. These records must be kept indefinitely and should include information about the firearms that were purchased, as well as the identity of the purchaser.
Conduct Background Checks
Another requirement if you become a federally licensed firearm dealer is performing background checks on any customer who purchases a gun. You are required to use the National Criminal Instant Background Check System in order to ensure that the firearm transfer doesn't violate federal or state law.
Advertising and Promotion
Once you've acquired a license, found a storefront and set up a system for record keeping and background checks, it's time to promote your new business. One of the best ways to do this is by establishing alliances with gun clubs, shooting ranges and firearm instructors. This will put you in contact with gun owners and will hopefully lead to referrals and marketing opportunities.
Opening a gun shop can be lucrative, but it comes with strict rules and regulations. You're selling lethal weapons and this brings the need to conduct your business in the most ethical and safe way possible.
Heather Skyler is a business journalist and editor who has written for wide variety of publications, including Newsweek.com, The New York Times and Delta's SKY magazine. She has a bachelor's degree in English from Miami University and a master's degree in writing from the University of Washington in Seattle. Before writing for a variety of publications, she taught business writing in Seattle.