Thinking of Getting an FFL

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gljjt
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Thinking of Getting an FFL

Postby gljjt » Wed Dec 10, 2014 4:33 pm

I'm thinking of getting an FFL, primarily to do transfers, and occasional sales on Gunbroker. Looking to, over the years, build a business to provide additional income for when we 'retire'. The business would be combined with some things my wife (an RN) is working on. I'm looking for any advice, especially any issues or concerns related to a home based firearms business. I've read my city ordinances and cannot find anything prohibiting this kind of business. Also any thoughts on liability insurance. We do plan to incorporate as an LLC. Thoughts? Advice? Thanks!


cb1000rider
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Re: Thinking of Getting an FFL

Postby cb1000rider » Wed Dec 10, 2014 5:10 pm

I looked into it a bit.. It's the record keeping that was a little alarming and the idea that you had to keep that forever and turn it in if you ever wanted to turn the business down.

In general home based businesses have to be wary of zoning and property restrictions, if they exist.. And the do exist in most residential areas.

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OldCannon
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Re: Thinking of Getting an FFL

Postby OldCannon » Wed Dec 10, 2014 6:42 pm

cb1000rider wrote:I looked into it a bit.. It's the record keeping that was a little alarming and the idea that you had to keep that forever and turn it in if you ever wanted to turn the business down.

In general home based businesses have to be wary of zoning and property restrictions, if they exist.. And the do exist in most residential areas.


This is true. If you live under an HOA, for instance, the ATF will require that you show proof that the HOA has approved your business to operate from your home.

The paperwork part isn't too bad, unless you're bad at keeping paperwork, then you shouldn't even consider being an FFL :lol:

As for retirement income, _please_ keep in mind that most firearms have very low margins. Combine this with the fact that you must be home to receive shipments (signature required) and you can quickly find that the FFL business can keep you tied into one place and not making a lot of $$. If you're good with that, then you're all set, but if you and your wife want to travel post-retirement, it's not really an option (counterpoint: You open a small store and hire an employee or three)

Feel free to PM me if you have specific questions :tiphat:
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gljjt
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Re: Thinking of Getting an FFL

Postby gljjt » Wed Dec 10, 2014 7:49 pm

OldCannon wrote:
cb1000rider wrote:I looked into it a bit.. It's the record keeping that was a little alarming and the idea that you had to keep that forever and turn it in if you ever wanted to turn the business down.

In general home based businesses have to be wary of zoning and property restrictions, if they exist.. And the do exist in most residential areas.


This is true. If you live under an HOA, for instance, the ATF will require that you show proof that the HOA has approved your business to operate from your home.

The paperwork part isn't too bad, unless you're bad at keeping paperwork, then you shouldn't even consider being an FFL :lol:

As for retirement income, _please_ keep in mind that most firearms have very low margins. Combine this with the fact that you must be home to receive shipments (signature required) and you can quickly find that the FFL business can keep you tied into one place and not making a lot of $$. If you're good with that, then you're all set, but if you and your wife want to travel post-retirement, it's not really an option (counterpoint: You open a small store and hire an employee or three)

Feel free to PM me if you have specific questions :tiphat:


Thanks! Still considering this. Need to be really sure. We aren't looking to make a killing (wouldn't turn it down though!!) but just some spending money. Probably not going to travel much, we have become 'homebodies'. We don'thave an HOA and there are no zoning restrictions. Will I need to prove that? If so is highlighting the appropriate sections of the city ordinances sufficient (in a printed document for the ATF examiner).

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RPBrown
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Re: Thinking of Getting an FFL

Postby RPBrown » Thu Dec 11, 2014 9:10 am

I have also thought about a FFL. I actually own my own business and have an office outside of the home that I would also use as my FFL place of business. The question that I have is what type of area would I have to have to show containment of any firearms? Will a lockable closet be okay or will I need a safe of some sort?
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Scott B.
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Re: Thinking of Getting an FFL

Postby Scott B. » Thu Dec 11, 2014 10:38 am

gljjt wrote:...We don'thave an HOA and there are no zoning restrictions. Will I need to prove that? If so is highlighting the appropriate sections of the city ordinances sufficient (in a printed document for the ATF examiner).


The IOI (Industry Operations Investigator) will probably check ahead of time as part of his/her investigation into you, but I'd have whatever information you can get in hand. When we had a home visit, prior to pursuing an office space elsewhere, the IOI had already contacted the HOA Management and brought a letter from them with her.

RPBrown wrote:I have also thought about a FFL. I actually own my own business and have an office outside of the home that I would also use as my FFL place of business. The question that I have is what type of area would I have to have to show containment of any firearms? Will a lockable closet be okay or will I need a safe of some sort?


A safe is preferable, but I believe a lockable cage or secure storage area also works. Think of all the firearms in display cases at the gun shops you frequent. I don't think the language is specific on how the firearms are secured as long as they are, but don't quote me.

The IOI will like video surveillance and will ask about any alarm systems you have.
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OldCannon
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Re: Thinking of Getting an FFL

Postby OldCannon » Thu Dec 11, 2014 10:54 am

Scott B. wrote:The IOI will like video surveillance and will ask about any alarm systems you have.


To be clear, I was never asked about video surveillance, but was asked about having a monitored alarm system. I would imagine they would expect video surveillance if you're a "Brick & Mortar" business, but not a home-based FFL.

Neither one are mandatory, from what I understand.

Remember that an FFL license is actually a "shall issue" license. That is, if there's nothing in the regulatory checklist that says you may NOT run an FFL, then the ATF must grant you an FFL :tiphat:

Of course, they can shut you down for screwing up just one 4473, but that's a different matter :lol:
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Re: Thinking of Getting an FFL

Postby Scott B. » Thu Dec 11, 2014 2:17 pm

OldCannon wrote:To be clear, I was never asked about video surveillance, but was asked about having a monitored alarm system. I would imagine they would expect video surveillance if you're a "Brick & Mortar" business, but not a home-based FFL.

Neither one are mandatory, from what I understand.


Right, but it's good to show that you've considered the security implications and it makes a positive impression as opposed to not.
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superchief
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Re: Thinking of Getting an FFL

Postby superchief » Tue Jan 06, 2015 10:37 pm

you should get an FFL if you meet all the requirements. I'm in my 4th year and i think it is a lot of fun. I don't know why more people don't do it.

1) zoning is a key thing to understand and be able to explain to ATF.
2) if zoning is okay and you pass a NICS background check, you will be approved.
3) there are no "security" requirements for storing any inventory. the language about security deals with making sure you provide gun locks with guns that don't have them.
4) you don't have to be at home "your premises" to get deliveries. I have mine delivered to a UPS box. it works great. if you travel a lot it can have an effect on scheduling to meet your customers.
5) i do 95% transfers and I love doing that business. I'm not making a living at all doing it, but I get to spend the money I make on (wait for it) GUNS!
6) the paperwork has to be right. just do it correctly and follow the rules.

PM me if you want more info to help you decide.

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Re: Thinking of Getting an FFL

Postby Scott B. » Tue Jan 06, 2015 10:53 pm

2014 industry operations inspection results, from ATF's presentation for this year's Shot Show.

Some data you might find interesting; number of licenses by type, percentage of violations, and what citations were issued for (fill out those 4473s correctly):

edit: (this is 2013, I'll have to dig up 2014, I saw it earlier today)

https://www.atf.gov/sites/default/files ... _final.pdf

edit 2: (okay this is for 2014, but it's power point instead of PDF)

http://www.atf.gov/sites/default/files/ ... stats.pptx
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cb1000rider
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Re: Thinking of Getting an FFL

Postby cb1000rider » Wed Jan 07, 2015 11:44 am

Does the surveillance stuff need to be kept indefinitely?
Can you educate us on "exit strategy" - My understand is that it's not quite as simple as just closing the doors...

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Re: Thinking of Getting an FFL

Postby Scott B. » Wed Jan 07, 2015 12:40 pm

There's no requirement to keep surveillance video.

By exit, you mean exiting from the business? Surrendering your FFL is pretty easy. Box up all your records, 4473s, etc, along with a form and ship it to the ATF. I don't have it handy but they've got a specific address for that. Then it becomes their problem.

If you ever get another FFL, your records start with a clean slate.
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OldCannon
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Re: Thinking of Getting an FFL

Postby OldCannon » Thu Jan 08, 2015 2:47 pm

superchief wrote:you should get an FFL if you meet all the requirements. I'm in my 4th year and i think it is a lot of fun. I don't know why more people don't do it.

1) zoning is a key thing to understand and be able to explain to ATF.
2) if zoning is okay and you pass a NICS background check, you will be approved.
3) there are no "security" requirements for storing any inventory. the language about security deals with making sure you provide gun locks with guns that don't have them.
4) you don't have to be at home "your premises" to get deliveries. I have mine delivered to a UPS box. it works great. if you travel a lot it can have an effect on scheduling to meet your customers.
5) i do 95% transfers and I love doing that business. I'm not making a living at all doing it, but I get to spend the money I make on (wait for it) GUNS!
6) the paperwork has to be right. just do it correctly and follow the rules.

PM me if you want more info to help you decide.


^ This! He nails it all. Alas, I used a shipping center for about a year. It went well, until they simply went out of business with no warning one day! It caused complete chaos with about a month's worth of shipments. Lots of unhappy customers, because a lot of firearms got shipped back to the sender and resulted in a lot of confusion.

Yeah, I'm still bitter with those clowns about that, they took a lot of people's money and skipped town. I've been half tempted to buy up that place to just have my own shipping and receiving center :lol:
I don't fear guns; I fear voters and politicians that fear guns.


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Re: Thinking of Getting an FFL

Postby Dr.Wayne » Thu Sep 17, 2015 6:47 pm

I'm interested in getting an FFL. Alot of references are telling me to get an LLC first, and not have it in my own name. To have that done right its about 530 bucks, then 530 for the FFL. Which FFL classes do you really need to have approved to do transfers and sell just handguns and rifles. Whats the cheapest/best way to do this?

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mrvmax
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Re: Thinking of Getting an FFL

Postby mrvmax » Thu Sep 17, 2015 9:36 pm

Dr.Wayne wrote:I'm interested in getting an FFL. Alot of references are telling me to get an LLC first, and not have it in my own name. To have that done right its about 530 bucks, then 530 for the FFL. Which FFL classes do you really need to have approved to do transfers and sell just handguns and rifles. Whats the cheapest/best way to do this?

Dr. Wayne

I would set up an LLC and all you need is a type 01 to sell non NFA firearms. I did the LLC myself with help from someone that had done it before, I think it was only around $300. Like was stated before, firearms are a low margin product and there are places like Buds and Grab A Gun that sell for a couple percent over what you can buy for. If you are home based some distributors will not sell to you, if you plan on having a brick and mortar store it will be easier.


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