Interesting Transfer Fee issue I just saw

[lucky4034]

But if it's his new policy than he did the right thing by informing the customer before the deal went down. (although it sounds like to me he just made it up on the spot).

This is my question... did he just make that policy up on the spot? That sounds so ridiculous... and it would **** me off. Actually, I would contact the online store I purchased the gun from and make sure he heard about said policy. With enough complaints maybe the LGS owner would be removed from the online stores list of FFL's

 

[cundiff5535]

Or you could decrease your price, and increase your sales volume. Yeah, it might be tough and rocky for a bit, but apparently it is working for Bud...

Again why would you ever stock firearms? It would be a silly investment... if your margin on a 430.00 dollar item is the same as a transfer fee ($30.00 bucks) why wouldnt you just have folks come in look at Buds website and place an order and collect transfer fees?

The profit off both are the same but you have zero over head... most LGS have 500-1500 firearms on hand... lets say this store had 500 guns in stock and the median price of those is 500.00... thats 250,000k in freed up cash. 90% of the time business's thrive off cash flow. If you cut the 250k you are far ahead of the game my man!

So how are you decreasing margins and increasing sales volume when the profit will never catch up to the revenue you have at risk?

See my point here?

 

[atvdave]

I understand that 100%...

Here is what I don't get...

Lets take an M&P for example. A local store is selling it for near 525-550 (or more). The dealer cost on it is 430... Buds is selling it for 460, no taxes no shipping... thats 30.00... No way a LGS could afford to sell that gun with a margin of 30.00 IMO. They would make the same margin on transfer as on a sale? Why even stock guns... just say hey order from Buds and we will do all your transfers... cut the overhead and be done with it.

First.. please don't think that I'm directing my post's at you... My post's are directed to the LGS that you were at.

I do not know what the dealer cost is or the mark-up but there are 100's of gun shops out there that make it on very discounted guns. One of them is whittakers Guns who employees well over 30 employees and sales 100's of guns a week if not close to a 1000.

As far as the LGS that you where at, the money will come back to them if they just treat there customers with a little respect. I for one would not step one foot back in that store, however if he would have just went ahead on did the transfer with out all the BS, I probably would be going back to purchase other things, maybe even a used gun if he had what I wanted..

EDIT:.. By the way... Whittakers has over 7000 guns on hand at all times, so it seams to be working for them... They are Kentucky's largest gun store..

 

[jeremy]

Again why would you ever stock firearms? It would be a silly investment... if your margin on a 430.00 dollar item is the same as a transfer fee ($30.00 bucks) why wouldnt you just have folks come in look at Buds website and place an order and collect transfer fees?

The profit off both are the same but you have zero over head... most LGS have 500-1500 firearms on hand... lets say this store had 500 guns in stock and the median price of those is 500.00... thats 250,000k in freed up cash. 90% of the time business's thrive off cash flow. If you cut the 250k you are far ahead of the game my man!

So how are you decreasing margins and increasing sales volume when the profit will never catch up to the revenue you have at risk?

See my point here?

Not really...

If that was the case, then Buds should be out of Business in the next year or two, right!?

 

[cundiff5535]

Not really...

If that was the case, then Buds should be out of Business in the next year or two, right!?

No and here is why... if you mention "Buds"... anyone who has ever looked at the online gun process and prices know exactly who they are... they were one of the first shops to attack the lower margins and raise sales volume.

They were very smart in their sales tactics and will always be known as the cheapest place to buy...

Secondly... Buds probably buys 3-10 thousand guns directly from Smith, Kimber, Colt, etc... at one time (they can do that now). The price that they are going to get is far cheaper than that of your typical LGS... you have those that do have ALOT on hand and probably can get similar prices but, trust me... its not that many.

So please dont take it as I am mad or hating on Buds... all I am saying is everyone cant realistically price in the way you refer to. Everyone cant price like Wal-Mart does either.

All I am simply saying is we should be careful only going for the "cheapest" deal out there as it can get to be a very dangerous thing. If LGS start closing down and all there is are the HUGE outfits well... prices will sky rocket and firearms will be very easy to control... out price what people can afford and then... we have no more guns (by no means am I saying that we are close to that happening).

Anyway... just some of my thoughts.... and J, thanks for the comments, I actually am enjoying the little discussion!

 

[cundiff5535]

First.. please don't think that I'm directing my post's at you... My post's are directed to the LGS that you were at.

I do not know what the dealer cost is or the mark-up but there are 100's of gun shops out there that make it on very discounted guns. One of them is whittakers Guns who employees well over 30 employees and sales 100's of guns a week if not close to a 1000.

As far as the LGS that you where at, the money will come back to them if they just treat there customers with a little respect. I for one would not step one foot back in that store, however if he would have just went ahead on did the transfer with out all the BS, I probably would be going back to purchase other things, maybe even a used gun if he had what I wanted..

EDIT:.. By the way... Whittakers has over 7000 guns on hand at all times, so it seams to be working for them... They are Kentucky's largest gun store..

Dave, sorry if my comments came off as me getting upset... I was simply just replying to what I read! I didnt think that you comments were harsh or directed at me either

Thanks for the replies!

 

[lucky4034]

I understand that 100%...

Here is what I don't get...

Lets take an M&P for example. A local store is selling it for near 525-550 (or more). The dealer cost on it is 430... Buds is selling it for 460, no taxes no shipping... thats 30.00... No way a LGS could afford to sell that gun with a margin of 30.00 IMO. They would make the same margin on transfer as on a sale? Why even stock guns... just say hey order from Buds and we will do all your transfers... cut the overhead and be done with it.

Ok... so if the LGS wants to charge me 460 + 30 transfer, then he will make 60 bucks on the sale.

If not, then I will get it from buds for 460 + 30 for the transfer and the LGS owner will make 30.

 

[atvdave]

They were very smart in their sales tactics and will always be known as the cheapest place to buy...

I beg to differ....

I just priced a Sig MK25..

Buds........... $885 shipped.
LGS ........... $875 No shipping.
Whittakers... $768 shipped.
PSA............ $810 shipped INGO sponsor.


I went with PSA due to they had it in stock and a INGO sponsor..

Bud's is not ALLWAYS the cheapest.

 

[atvdave]

Ok... so if the LGS wants to charge me 460 + 30 transfer, then he will make 60 bucks on the sale.

If not, then I will get it from buds for 460 + 30 for the transfer and the LGS owner will make 30.

If you buy it from a LGS then there is no FFL transfer fee..

But IMO $30 is better (and maybe a repeat customer) than $0.00 and never to come into the store again.

 

[elliotle]

I've only ever done a transfer on my Arsenal AK, and that was because nobody in the area keeps them in their inventory regularly. I checked all the area gun stores first. I find it funny that people think a business should support a transaction that is basically giving business to a competitor.

 

[JoshuaW]

I will buy just about anything online if it is a reasonably better deal. Im not going to sweat $30, but $50+ and I have to do what is best for me. With that being said, FFLs are lucky. They can still make some money off of every transaction. Yeah, they may prefer to actually sell the gun, but a lot of industries can't make a penny from an online sale.

 

[KLB]

I've only ever done a transfer on my Arsenal AK, and that was because nobody in the area keeps them in their inventory regularly. I checked all the area gun stores first. I find it funny that people think a business should support a transaction that is basically giving business to a competitor.

Only if they wish to make money for a few minutes of work and temporarily storing the item. Many are happy to do so.

 

[Hoosierdaddy74]

One thing to remember is that every steady customer was, at one time, a first time customer. You simply can't have one without the other.

Very Very good comment!!!
I have bought few guns from LGS and accessories and go back in for questions\issues and you would have thought I called their mother names. These are VERY popular LGS and I take it with a grain of salt. I like the guys\stores in question but I now know to do my research before hand.

 

[MACHINEGUN]

I'm laughing at you because you think he was being fair, how is that fair? He did the right thing by walking out!

 

[T4rdV4rk]

I'm all about buying local or at least within the state, but it bothers me when stores (one on northwest Indiana in particular) charge ballpark 100 more than you usually see for guns. They then charge $50 transfer fee standard. If you can't match prices then you're screwed. Ask everyone Walmart ran out of town.

 

[ryknoll3]

When I lived in Illinois I called up Pelcher's in Lansing and asked them their transfer fee. They told me $35. I set it up and when I went to pick up my gun, they told me they also have to charge me Illinois sales tax (6.5%). Illinois doesn't charge sales tax on transfers or services, so I basically got screwed out of another $50 from them. They had my gun, I tried to argue, but didn't get anywhere.

When I moved to Indiana, I called around looking for a new transfer dealer and called Blythe's in Griffith. They told me transfers "started at $50." I asked them what "started" means and they told me that they have to insure each gun that comes through the door, so they charge based on the value of the gun. This is total horsecrap, as business liability insurance would cover their inventory.

Both of these shops put a VERY bad taste in my mouth and I never stepped foot in them again. I also take every opportunity to bad mouth them to my friends and shooting acquaintances.

On the other hand, Matt at Front Toward Enemy (INGO Sponsor) has been nothing but awesome, and I've steered several customers his way because of his awesome service. He's happy to transfer in a gun if he can't match or beat the price.

There's a big difference between what happens when you treat a customer right or when you crap on them.

 

[doctrpt]

I have a feeling I know who the LGS was in this instance. If so, this has become a source of concern with those who are aware of the dealings. Even if I am wrong, the business practice is flawed, and the model a fool's model. The policy should be one and the same for all customers, just as the price should be one and the same for all customers. If someone comes into a shop for the first time, asks to see and price a certain gun, then hangs for a few to look at other products, and sees another more frequent customer come in, greeted by name, and when that customer asks about the same gun, overhears a price $50 cheaper for the "known" customer, then the shop just lost the new customer once and for all. It is one thing to give a special price to a good customer, and that's not the issue. The issue is the way this sounds like the "lotto" or "let's make a deal" on a gun, changing policies at the door with each customer, and other issues. I have been into such a shop in the last few months more than once recently, and the last time I was in the shop was the last time I will be in the shop, for just such business practices. The way the OP described the situation, I would have walked out too. Thank God I deal locally with a group of people who want to work to do transfers fairly, at a reasonable cost. If he has what I need, I buy it from him. Most of my transfers are older guns that he does not handle, or has no source for, and that is to me what an FFL transfer is about. If my local guy has it, I give him the business. Price is secondary sometimes, and I don't mind paying a little more to keep my local guy open. Of course we all want the great deal,...

 

[dwickstrom]

I have a local gunshop I use all the time it was fathers day last year and a local discount sporting goofs store had the rem 597 on sale for 149.99. So I thought i will take the flyer to the gun shop to see their price for the exact same rifle they were charging 299.00 and wouldn't price match i spend thousands of dollars a year there they would not budge on the price so i bought it at the other store. Two weeks later it was on sale at the gun shop still higher than what I paid for mine.

 

[Bartman]

A question for the group

My question is then: how much is a "fair" markup on any gun bought in a LGS? A local shop here has a website that they also sell and ship guns through. I was looking at a couple of models that they had listed for a specific price on the internet. When I went into the shop itself I saw the same guns listed $80 to $90 higher. It didn't sit right that they were willing to sell a gun at a much lower price and ship it off elsewhere while the local customers get to take on the burden of keeping the lights on. So lets say you do your research and know what a fair price is for what you want. How much more are you willing to pay to keep that local shop in business?

 

[Libertarian01]

To All,

Many good points here. It seems to me that the LGS owner has some seriously flawed logic. It stems from faulty thinking that he wants to see all competition go away.

We live under the ideal of capitalism, the free market. Under this model the weak perish and the strong survive.

What if the potential customer had never bought a gun? Then the LGS would have $0 profit.

What if the potential customer had bought his gun from another LGS? Then the LGS would have $0 profit.

What if the LGS had actually done a transfer for $X? Then the LGS would have made $X profit! This LGS was too short sighted to see this.

An ideal business model is one that takes your money and makes you feel happy about it! There are two (2) ways for a business to compete in a free market, best quality at lowest price OR best service at lowest price.

Had the LGS been affable, friendly and cooperative he could have made the transfer fee profit. Had the LGS inquired about why the customer went with the online store he could have learned something and improved his own business.

One of my business instructors works for a big retail store. His company recommends going to the competition to observe, learn and gain new ideas. It would appear that this particular LGS employee/owner has failed in this area.

The beauty of the Internet is that you can sell to the world. The downside of the Internet for those who fail to adapt is that, for the customer, I can buy from the world!

A basic business concept is a SWOT analysis. This stands for Strengths, Weaknesses, Opportunities, and Threats. Strengths and Weaknesses are internal to your business, things you can control. Opportunities and Threats are environmental, things you cannot control. However, the opportunities and threats can be exploited and minimized with proper planning and the ability be flexible.

It seems a shame that in the long run this particular LGS is doomed to failure if the owner doesn't wake up to realize that customers will buy online and this can give him the opportunity to make them happy with good customer service instead of a crappy attitude.

Sorry for the long post.

Regards,

Doug

PS - And we wonder why American businesses fail?