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Thinkin' about a reloading business

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  • TexMex247

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    May 11, 2009
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    Leander(NW Austin)
    Ok, so call me stupid if you want to but I've been thinking about starting a reloading business. I know I will need to obtain a class 6 ffl, location, equipment,insurace and of course a well detailed business plan(if a want a loan). I don't plan on making this my primary source of income and don't want to mass produce. I was wondering if anyone has been down this road before. With all of the shortages lately, I know that certain components are in short supply. This does not worry me because I have already seen availablity increasing everywhere. I am NOT interested in producing cheap plinkin' rounds, strictly handmade match grade ammo thoroughly tested for speed, grouping, consistency etc. I am currently developing these loads for personal use which I would of course duplicate later for sale. I DO plan on reloading customer provided fire-formed brass as well newly manufactured rounds. I have read on many forums that it just isn't worth dealing with all of the liability but I want to hear about some first hand experiences. If anyone is interested in investment oppurtunity etc. PM me about it or if you just want to tell me how stupid this all sounds then let it fly - Texmex
    Military Camp
     

    zembonez

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    Might well be a money maker if run correctly. The liability would probably spook me though. You'd just have to stay perfectly on the top of your game and produce nothing but quality product.
     

    DCortez

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    Jan 28, 2009
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    Get out of debt
    Stay out of debt
    Don't buy the biggest and best
    Don't rely on others, be prepared to do everything
    Figure out what cal sells the best & what you want to sell
    Shipping, don't use mailboxes etc. stores, go to fedex store
    Get a fedex freight acct, don't use regular fedex
    Packaging?
    Marketing?
    Where will you get your supplies?
    What happens if Obama poops on your dream?


    I could go on, but you get the gist.
     

    Bullseye Shooter

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    Apr 28, 2008
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    Texas Panhandle
    I had two friends, each had their own reloading business. Small profits, lots of work and when they wanted to get out of doing it, they could not sell the equipment for enough to get out of the debt they built up. They eneded up doing it, to just try and get enough to break even on the equipment. They're out of it now, at a loss.
     

    TexMex247

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    It just seems so profitable, I don't see how you would wind up in the negative unless you had legal problems. I don't want to buy or ever use commercial equipment. I know it sounds crazy but quality control is the key issue for me. Truly hand loaded ammo at fair prices. A good example, .223 rounds back in the day(90's) sold new(win white box) for around $6 for 20. Now that price has doubled or more. Hand loading with once fired brass costs about 15 cents for a Hornady BT bullet, 4 cents for primers and 6-8 cents for powder. Those are all at retail prices, that adds up to 25-28 cents per round, or about 5.50 a box. Add the 11% government tax and that's still only about 6 bucks a box. Bullets of this quality would typically sell for a dollar a shot if bought under winchester or competitive labels. I'm thinking insurance has got to be the most expensive aspect other than overhead. I would plan on selling a load like this for 11.99/20 with once fired brass or 17.99 w/all new components. That undercuts the competetion big time. Even the cheapest ball rounds cost you over 40 cents a piece from quality reloaders like Collins cartridge co.(with once fired mil brass). My initial plan would not be for large scale production or shipping outside of Texas except to distributors. Still a ton of details to work out and many more loads to be tested before I start cranking them out and selling them. We'll see how it all pans out.
     

    MadMo44Mag

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    Jan 23, 2009
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    Years ago I helped a commercial re-loader - that's who got me started reloading.
    Even with top of the line equipment and good resources, this is a very time consuming endeavor.
    Rifle ammo is very time consuming because of all the necessary steps involved to turn out quality ammo that will chamber in any gun.
    I'm not trying to discourage you, just be advised that this is a very time intensive business.
    Good luck!
     

    wrtanker

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    Jul 17, 2009
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    I was reading in another thread (lost track of which one) about some impending legislation in Austin about firearms and ammo produced entirely in Texas for Texas-only distribution. It seems that the federal laws wouldn't apply so you shouldn't need the class 6 FFL. Of course, that assumes you can get all of your components from Texas sources....
     

    Pappy

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    Feb 29, 2008
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    Also consider the customer base..I personally will not buy reloads and will use only my own or factory..mine being first choice.

    Anyway, anyone doing serious quality shooting will probably prefer to load their own.

    From my viewpoint, it's not a good idea....
     

    Bullseye Shooter

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    Apr 28, 2008
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    Pappy brings up a point which I did not mention in my earlier post. The two guys I knew who were reloading were doing strictly pistol rounds, no rifle. One of them attempted to load some .223s for sale, but found that with the wide variety of rifles at the time, he could not guarantee they would function in everyone's firearm. He especially had a problem with the early Ruger Mini-14s.
     

    Texas1911

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    I think it could be profitable if you kept the scale to an efficient minimum. When you involve alot of overhead and infrastructure (machines, buildings, etc.) you can get into requiring profits.

    Selling at a gun show seems to be one of the safest bets out there.
     

    spence76

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    Aug 23, 2009
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    The BATFE just declared Tennessee's "in-state" firearms law not valid, so I wouldn't plan on Austin's law being valid as well. It certainly would be a nice thing, but I think we would need support from the Executive Branch for it to happen and with the current federal administration, that's a deadend.

    Here's the link: [url]http://www.tfaonline.org/downloads/ATFfirearmsfreedomact.pdf[/URL]

    I think technically that is ATF's opinion, since the NFA and GCA were instituted under the interstate commerce clause they refer more to the tax revenue aspect. It will ultimately be up to the courts to decide but until then ATF can't override state laws. Also that letter could just be ATF's way of threatening to pull FFL's if you comply with laws they don't like. Of course I could be completely wrong about that, wouldn't be the first time.
     

    TexasRedneck

    1911 Nut
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    Jan 23, 2009
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    It just seems so profitable, I don't see how you would wind up in the negative unless you had legal problems. I don't want to buy or ever use commercial equipment. I know it sounds crazy but quality control is the key issue for me. Truly hand loaded ammo at fair prices. A good example, .223 rounds back in the day(90's) sold new(win white box) for around $6 for 20. Now that price has doubled or more. Hand loading with once fired brass costs about 15 cents for a Hornady BT bullet, 4 cents for primers and 6-8 cents for powder. Those are all at retail prices, that adds up to 25-28 cents per round, or about 5.50 a box. Add the 11% government tax and that's still only about 6 bucks a box. Bullets of this quality would typically sell for a dollar a shot if bought under winchester or competitive labels. I'm thinking insurance has got to be the most expensive aspect other than overhead. I would plan on selling a load like this for 11.99/20 with once fired brass or 17.99 w/all new components. That undercuts the competetion big time. Even the cheapest ball rounds cost you over 40 cents a piece from quality reloaders like Collins cartridge co.(with once fired mil brass). My initial plan would not be for large scale production or shipping outside of Texas except to distributors. Still a ton of details to work out and many more loads to be tested before I start cranking them out and selling them. We'll see how it all pans out.

    With all due respect, have you ever been in business before? Where will you operate this? Out of your house? Are you zoned for it? Because your business insurance may not allow you to home-base.

    Let's take your .223 example...$5.50/box? Really? Is someone gonna GIVE you the once-fired brass? Because I don't see that factored in your calculations. I can buy PMC .223 ammo for $351/thousand....that's what, 35.1 cents/each. What you have to remember is that the ammo pricing is supply/demand - and supply is finally catching up, and as it does it's gonna get cheap again - and your business model is gonna get hurt. And I think you're gonna be in for an eye opener when you start thinking about how many rounds it's gonna take to cover your overhead. I mean, think about it - if insurance, phone and rent costs you $500/mo, that means you're gonna have to sell 50,000 rounds/month @ a cost factor at $0.01/round.
    How long is it going to take to crank 1000 rounds? Say 3 hours at minimum, start to finish? At $15/hour, and let's say you can do it all in TWO hours....That's a cost factor of $0.033/ea.
    Notice we haven't addressed any real profit on this - but if you're gonna have a cost of $0.27 + $0.01 + $0.033, or $0.313/round.
    I'm not trying to dissuade you - but I AM trying to get you to look into things a tad more afore you jump into some very expensive waters.....
     
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