Author Topic: Small Scale Commercial Reloading - Anyone Considered It?  (Read 800 times)

0 Members and 1 Guest are viewing this topic.

Offline tdogg

  • Hero Member
  • *****
  • Posts: 2263
Small Scale Commercial Reloading - Anyone Considered It?
« on: July 27, 2022, 12:56:14 PM »
I recently purchased a S1050 and am considering autodriving it.  It makes ammo way faster than I will ever need and I'm considering getting into commercial reloading/brass processing and starting a small ammunition company.  My initial goal would be to supply local shooters with USPSA tailored ammunition and pay off the autodrive.  I'd probably go with an 07 FFL so I could also smith/sell firearms as well.  I guess at this point I have more questions than answers and I thought why not turn to the forum that got me into reloading in the first place for answers?

Has anyone started up a commercial ammunition operation?  Have any tips or guidance your willing to share? 

My biggest uncertainty at this point is component supply/costs?  I'm not sure what the future of commercial supply looks like or the prices I can expect to pay for components?  I reached out to Black Hill shooters supply to see if they were willing to share pricing but they weren't until I could setup a business account (required an FFL).  They did indicate that primers were all but nonexistent still and that may prevent this whole idea from getting started.

I haven't looked into liability insurance yet but I assume that will be a significant consideration as well.  I also don't fully understand the FFL requirements yet.  I have researched them but I'm not sure exactly I need to have for a homebased FFL.  I don't have a detached workshop that would make it easier to separate the business space but I don't think that is a deal breaker.

Are there any other considerations that I need to research before kicking this off?

This would not be my day job, just a small side hustle to foster/bolster my personal shooting supply.

Cheers,
Toby
This forum rocks!

Offline bang bang

  • Hero Member
  • *****
  • Posts: 2738
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #1 on: July 27, 2022, 01:15:34 PM »
I recently purchased a S1050 and am considering autodriving it.  It makes ammo way faster than I will ever need and I'm considering getting into commercial reloading/brass processing and starting a small ammunition company.  My initial goal would be to supply local shooters with USPSA tailored ammunition and pay off the autodrive.  I'd probably go with an 07 FFL so I could also smith/sell firearms as well.  I guess at this point I have more questions than answers and I thought why not turn to the forum that got me into reloading in the first place for answers?

Has anyone started up a commercial ammunition operation?  Have any tips or guidance your willing to share? 

My biggest uncertainty at this point is component supply/costs?  I'm not sure what the future of commercial supply looks like or the prices I can expect to pay for components?  I reached out to Black Hill shooters supply to see if they were willing to share pricing but they weren't until I could setup a business account (required an FFL).  They did indicate that primers were all but nonexistent still and that may prevent this whole idea from getting started.

I haven't looked into liability insurance yet but I assume that will be a significant consideration as well.  I also don't fully understand the FFL requirements yet.  I have researched them but I'm not sure exactly I need to have for a homebased FFL.  I don't have a detached workshop that would make it easier to separate the business space but I don't think that is a deal breaker.

Are there any other considerations that I need to research before kicking this off?

This would not be my day job, just a small side hustle to foster/bolster my personal shooting supply.

Cheers,
Toby

welcome...sorry i dont have answers for you but you appear to be on the right track.  alot of info i get is by doing my imitation of a "fly on the wall". 

you may want to investigate the insurance implications first.

there are also federal tax implications too.

You may want to look at setting up some type of LLC or ?  But i would be taking to an attorney about your ideas and see what you can do to shield yourself and anything of value you may have, just in case.

as far as components prices, you will need to look at what you can get your hands on and if you have the pockets to buy in bulk.  And maybe alot of bulk.

And there is then the powder storage requirements.   will you be doing the reloading in your kitchen, garage or basement or ?   

and then you will need to consider while reaching out to BHS, you may want to reconsider that since if you end up doing what you want, you will be competing with them and their resources.   You can do the wholesale/mfg route once you get your FFL/mfg license.   I think once you get your license/FFL you can contact the mfg and they will be more than happy to give you their 0.02 and how they do things.

good luck




Offline alp3367

  • Full Member
  • ***
  • Posts: 295
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #2 on: July 27, 2022, 01:27:33 PM »

Are there any other considerations that I need to research before kicking this off?

Cheers,
Toby

 You covered some major considerations. One big one you didn't mention is demand. It sounds like you do have a target market, but have you talked to any of them to gauge interest? The serious shooters are probably already reloading. Most are pretty happy to talk about ammo pricing and what they are paying and would pay.

 It really comes down to how serious do you want to get about it. With the current situation regarding pricing and supply you may have a very difficult time breaking even, much less being profitable. And without having a business set up currently to get wholesale pricing information it's hard for you to do much analysis.

 I would absolutely not run something like this as a sole proprietorship due to liability concerns so would also look into forming an LLC. I would strongly suggest you speak with an attorney experienced in business liability as you don't want to see everything you own taken away if somebody is seriously injured due to your ammunition. As a manufacturer you would also need to be aware of FET and that you have to pay it.

 Many people won't shoot reloads at all if they didn't load it, I'm one of those. I've seen too many catastrophic kabooms over the years with peoples reloads. Though I've seen it happen with factory ammo as well, but odds are much better with it.

Some companies have made a go of it and been successful.

Offline tdogg

  • Hero Member
  • *****
  • Posts: 2263
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #3 on: July 28, 2022, 02:21:30 AM »
Thanks all for the insight thus far. 

I definitely would be setting up an LLC as I wouldn't want to risk my personal assets for this venture.  I'm also not sure how serious I'd want to be about this.  I don't think I'm that committed nor do I have the time to be serious about this at this point.  It might just be a back burner effort for some time while I figure things out.

I'm not that concerned about making money at this point.  If I could pay off the expenses it would be a success.  I don't think I'd be selling ammunition for some time but may continue to sell processed brass and do transfers etc to help offset any FFL costs.

It seems that ammo supply has gotten much better thus demand may be not be there.  I have some ideas on how to hopefully make long term customers but I'm not sure if it would be feasible/profitable?  It all depends on if I could secure components at a reasonable cost.  That may prove impossible in the near term but hopefully we will see it ease sooner than later.

Cheers,
Toby
This forum rocks!

Offline Togmaster

  • Full Member
  • ***
  • Posts: 325
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #4 on: July 28, 2022, 05:20:24 AM »
Look into local building/fire codes. If you are doing this out of your home you may not be zoned for that type of business. This may not be a concern in a lot of areas in this country but it is where I live.
Let's go Brandon!

Offline tdogg

  • Hero Member
  • *****
  • Posts: 2263
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #5 on: July 28, 2022, 12:27:15 PM »
Look into local building/fire codes. If you are doing this out of your home you may not be zoned for that type of business. This may not be a concern in a lot of areas in this country but it is where I live.

That is a great suggestion!  I hadn't thought about zoning?  I had thought about how to store components in bulk but not if there were zoning restraints.

Thanks!
Toby
This forum rocks!

Offline Harrell2Xtap

  • Jr. Member
  • **
  • Posts: 42
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #6 on: August 02, 2022, 07:26:14 PM »
I am apart of a family company that did the same thing your thinking about doing in 2013. We traveled the country doing gun shows as well having multiple stores in S.C. . About 5 years ago we moved into an existing indoor range that was felling miserable. If it wasn't for that we would of went out of business went Trump got into office because the supply and demand fell off. When covid hit we turned the machines back on and have been slowly upgrading to Ammoloads and Alpha priming machine. Ammo prices went through the roof and made us some money but prices have  started to come back down. Things are still very hard to get as far as components go. If it wasn't for European countries like Serbia and Czech Republic we would have ran out already of powder and primers. If you don't have a solid supplier I would not waste my time and keep your day job and just make ammo on the side.

Offline tdogg

  • Hero Member
  • *****
  • Posts: 2263
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #7 on: August 02, 2022, 10:37:17 PM »
Are there any hidden costs that I should be aware of getting into ammo making? 

I'm definitely not quiting my day job.  This will be a small side hustle at best for the time being.

Thanks for your insight!

Cheers,
Toby

Sent from my SM-G950U using Tapatalk

This forum rocks!

Offline Harrell2Xtap

  • Jr. Member
  • **
  • Posts: 42
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #8 on: August 07, 2022, 01:39:33 PM »
Well then as long as your doing it on the side go for it. It's money you can make when you can make it and you will meet some awesome people in this trade. Who knows it could take off and become the next big thing you never know unless you try. Hell looking back to 2013 I never thought we would be where we are today so it can go right as long as your willing to work at it and make quality ammo that you stand behind. Gather good people around you to help and the skies the limit. As far as hidden cost I wouldn't think so you have your license and insurance and tons of components. Unless you make bad ammo and hopefully not blow up some guns or worse then its pretty straight forward. Good luck

Offline Harrell2Xtap

  • Jr. Member
  • **
  • Posts: 42
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #9 on: August 07, 2022, 01:41:28 PM »
Oh yea forgot to mention don't borrow any money to do it. Cash flow everything because I've seen more than a few companies go under after getting in over there head.

Offline lewmed

  • Sr. Member
  • ****
  • Posts: 570
  • 135th & 240th AHC Vietnam 1967-1968
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #10 on: August 07, 2022, 03:23:48 PM »
 Before the laws changed I used to reload for a couple local PD's and gun clubs but I gave up my license after being harassed by the ATF. As a licensed reloader with a 06 FFL there is a 11% excise tax levied on all new or reloaded ammo. In the past you could avoid that tax by having your customer exchange their once fired brass at the time of sale. The law now reads the ammo sold to a customer must be loaded in the customers same exact cases provided by the customer. After being audited several times and with only two clerical errors found I just gave up and sold off most of my equipment.

Offline tdogg

  • Hero Member
  • *****
  • Posts: 2263
Re: Small Scale Commercial Reloading - Anyone Considered It?
« Reply #11 on: August 08, 2022, 12:49:48 AM »
Yeah I'll have to factor the tax into the ammo pricing if I get there.   

I try not to finance anything at this point.  I'm blessed to have that freedom at this point.

Still plenty of things that need to fall into place to make this happen.   Thanks to all for your insight!  Keep it coming!

Cheers,
Toby

Sent from my SM-G950U using Tapatalk
This forum rocks!