Finders Fee Program Idea For LGS.

[arakboss]

From personal experience working with an FFL, I have seen a bunch of guns turned away because the customer wanted too much for them, they were going to be difficult sell, etc.

To have an opportunity to pick up one or more of these firearms, I am going to propose this idea to my favorite FFL and volunteer as a guinea pig to test out the viability of it.

I will give my FFL a certain amount of cash to keep in a safe. I will also give him a short list of firearms, I am looking for and at what price, to keep at the front counter.

If a customer brings in a firearm to sell but the FFL can't make a deal worthy of adding it to his own inventory, he can check the finders fee list and see if it is one I am looking for. If my price allows him to make the purchase then I will buy the firearm from the FFL.

Example.

I give the FFL $250 cash and tell him I am looking for a Glock 19, 23, 26 or 27 any Generation, good condition or better for $200. $50 is the minimum finder's fee (25%).


Customer comes in with Glock 23 Gen 4 in good condition but wants $200 firm and FFL won't pay more than $100 to add it to his inventory. The FFL can let the customer walk or he can use $200 of my cash to buy the pistol and pocket the rest as a finders fee. If he buys it with my cash, then I come in a month later, pay the $10 FFL fee, do the BG check and pick up my Glock 23.

There were a number of the guns the shop wouldn't buy that I would have snapped up in a second. A very old Colt Dectective was one memorable one.

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[Andy54Hawken]

I understand the idea however....
Sounds like a lot of work for the FFL....and no guarantee that you will actually follow through with the purchase.
Please note that I am not saying that you ain't a man of your word....just pointing out that it's extra work for the FFL with not much in it for him.
Andy

 

[ilikegunspdx]

Damn, I would hate to be your employer.

"Hey employer, do you mind if I undercut your business model of paying low and selling high? I'll make your customers think you are lowballing them and that others are waiting on site to give them more $. That way you'll have less inventory and will make less $, wouldn't that be great?"

"Oh and by the way this is all very likely illegal because I will be operating onsite as an unlicensed ffl."

It's just ridiculous.

 

[Yarome]

Sounds like something an FFL might do for a good buddy, but also sounds like trying to "use" the FFL to pick up firearms for chump change and throwing him a $50... that he would likely get in transfer fees, anyway.

I'm sure an FFL would be happy to have a list of wants... providing a person was willing to pay a discounted fair market value if he can flip it in a hurry.

IE. He might not want to pay $200 for a used firearm he can only sell for $375, but he might if he knows he can flip it overnight for $350.

I wouldn't bet any FFL is going to go to the effort and assume the risk that his definition of "good condition" will match up with a potential buyers definition to follow through on the sale just for a fifty. He would be shooting his business in the foot by facilitating chump pricing buys for pocket change.

 

[arakboss]

I understand the idea however....
Sounds like a lot of work for the FFL....and no guarantee that you will actually follow through with the purchase.
Please note that I am not saying that you ain't a man of your word....just pointing out that it's extra work for the FFL with not much in it for him.
Andy

The margins would be slim.

As for following through, the FFL would have the buying customer's money in advance so follow through would essentially be guaranteed.

Since the margins would be slim, it would be treated as a last ditch option to make a purchase on a firearm that a selling customer brings in.

The process would not be much different than the FFL buying a firearm for his inventory and then selling it to a customer. The difference being that the FFL already has a buying customer ahead of purchasing the firearm from the selling customer.

 

[Andy54Hawken]

Something else to consider....

If your FFL does this service for you...
Then he will need to do so for others....that is a lot of lists and work.

If he does do this service for you...and not others...
That could end up with a loss of customers....perhaps a lawsuit...
Andy

Edit to add...
In any event it don't matter what I think of your idea.
Go ask your FFL.....if he is willing to do this...then good for you.

 

[Hueco]

What you've described is essentially gunbroker.

ETA: or consignment sales in reverse. Instead of the listing/holding fee being paid by the seller, you're coughing it up as the buyer.

Instead of the business sitting on inventory that may attract buyers you're hoping that such a shop brings in a bunch of interested sellers and asking them to do paperwork.

I just don't see the viability of it. By the time you scale this up past "friends and family" you have to have an inventor-like system for tracking who is interested in what and for what values. Who gets priority when two are interested for the same amount? Do you start calling the buyers to see who will pay more? Isn't that a bidding war?

Such a system would rely on the business having a massive list of interested buyers in order to make selling there worthwhile. So…gunbroker.

 

[arakboss]

Something else to consider....

If your FFL does this service for you...
Then he will need to do so for others....that is a lot of lists and work.

If he does do this service for you...and not others...
That could end up with a loss of customers....perhaps a lawsuit...
Andy

I am proposing this as a potential service for other customers. A test of the idea would be wise to see how much work it might really be and how fruitful it might be.

If it was my store I would pay more to the seller, keep the firearms in my inventory and settle for 200% margins. But that ain't going to happen so I'm searching for other ideas that keep sellers from walking.

 

[arakboss]

What you've described is essentially gunbroker.

Basically yes. The FFL would act as a firearm broker and customers would not have to meet or know each other.

 

[Hueco]

Basically yes. The FFL would act as a firearm broker and customers would not have to meet or know each other.

Edited my post for more thoughts

 

[trekkerpaul]

Sounds like a potential liability and loss of revenue for the FFL. You are going to get a list together, from you and and your buddies, so that you can undercut his business model, to sell more guns, to you and your buddies. If you are charging a fee for your location service, which it sounds like you might want to do, then my bet is that is illegal. If you didn't charge a fee for your planned location service, then why would you want to go to all the extra effort for nothing? Your FFL knows the price points he wants to buy and sell. He also has been in the business long enough to know which way the economy is headed and how that will effect his bottom line. I can see your FFL getting stuck with stock that he doesn't want and over paid for. Why would he want to do that?

 

[arakboss]

Sounds like a potential liability and loss of revenue for the FFL. You are going to get a list together, from you and and your buddies, so that you can undercut his business model, to sell more guns, to you and your buddies. If you are charging a fee for your location service, which it sounds like you might want to do, then my bet is that is illegal. If you didn't charge a fee for your planned location service, then why would you want to go to all the extra effort for nothing? Your FFL knows the price points he wants to buy and sell. He also has been in the business long enough to know which way the economy is headed and how that will effect his bottom line. I can see your FFL getting stuck with stock that he doesn't want and over paid for. Why would he want to do that?

You are misunderstanding what I proposed. the FFL would be doing this not me and my buddies.

 

[Member 53328]

I'd fire this guy.

 

[Knobgoblin]

I'd fire this guy.

I have a 90 day buffer period for dismissal without union assistance.

Lol

 

[ilikegunspdx]

Buying and selling multiple firearms with intent to make a profit is illegal without an ffl license. I think it may also be illegal to solicit such a transaction on the premises of another ffl.

Real possibility here of this person violating the law and who knows if the ffl would have to pay the consequences if he was caught. Or if this person gets mad at ffl and turns in the ffl for something the person has done himself (just an example). I would fire this type of person in one second. It is way too high of a risk. He has already publicly aired his grievances with his employer on this forum in other threads.

 

[arakboss]

Here is the problem:

Seller comes in with firearm that FFL could easly sell for $500 but seller wants $200. FFL won't pay more than $100 so the seller walks.


What is a good solution:

How can the FFL salvage more of these deals without giving up any margin on money he puts at risk?

 

[Certaindeaf]

I have a 90 day buffer period for dismissal without union assistance.

Lol

Union assistance aka concrete galloshes.

 

[Knobgoblin]

I like you man. No , we've never met, but I usually dig your wackiness.

There is no problem. Retail isn't about maxing out your sales volume. There is a natural eb and flow. If ownership doesn't care , you shouldn't either.
Much respect to your drive, creativity and initiative. But chill out. Peace

 

[RVTECH]

I am going to propose this idea to my favorite FFL and volunteer as a guinea pig to test out the viability of it.

Hypothetical question - SO if you, as the 'guinea pig', test this out and it works is your intention to present this to other customers so they too can deposit X amount of cash with the FFL to do the same?

 

[Kruel J]

It's like FFL LARPing.