Any Lawyers Here ?

[billt]

OK, this is my retirement brainstorm in a few years down the road. I do a ton of handloading anyway, so I thought of perhaps selling ammo via mail order. Nothing big and or elaborate. Basically I'm thinking of getting a Dillon Super 1050 anyway in .223 with Carbide dies because of the amount of guns that I have in that caliber, so why not make a little on the side when I have nothing to do but warm a chair with my butt and collect S.S.?

.223 is a good caliber because it's relatively expensive to buy at close to $10.00 per 20 for the cheapest stuff, plus with all of the black rifles recently purchased it is a caliber that is in high demand. It is also a very easy cartridge to load for because of all the Mil-Surp brass and powder that is available in large quantities at good prices.

The issue is a legal one. I have no idea what type of insurance, if any is required. I'm almost quite sure you would need some type of liability insurance, but how much and what kind, I have no idea. It is easy enough to post in classifieds in forums like this one, and if your product is good, and at a fair price, word of mouth will do wonders in the shooting world. This would strictly be internet mail order out of the house, no storefront or "business" per say.

Another issue is being able to take credit card purchases over the Internet. That would be a must. I have zero idea how complex or expensive that is, or how to set it up. Have any of you ever done something like this? If so how did it go? What was the approximate cost to get it up and running? Right now I'm just thinking out loud. If it becomes a big PITA, I'll just forget it, but it sounds like it's worth investigating. Thanks in advance,   Bill T.

[TAB]

You really don't need a lawyer for that, but it would be a good idea to have one.

To start out with you are going to need a FFL ( I want to say a 04 or 06, but I forget)  You need to meet all reqs for that, at all levels inculding local.

For insurance, talk to a good comm'l insurance agent, they will be able to send you to the right company.

Credit cards are no big deal, there are tons of companys out there, its just a matter of shoping around and finding the terms you want.   if its going to be net based there are even companys that do this for you.

Create a shiping account.( really big deal, it can be the diffrence between making it or breaking it with mail order) 


What you really need to do, is figure out how much the stuff above you is going to cost.  Figure out what its going to cost you to reload, then see if its worth it to do.


PS, I don't think you will be able to put out enough rounds of 223 even with a 1050 to make it profitable.  the more odd ball stuff yes.

[TAB]

Something else I just remembered, there is a exise tax on ammo, its either 13 or 17%( the ATF will know when you fill the paper work for the FFL)

so factor that into your prices.

as a biz owner, here are some realitic number for you to think about.



With a 1050, at most with case prep, qc and every thing else, you will be able to load about 1000 rounds a hour.

For every hour you spend reloading, figure on 2 hours of doing other things.  Packaging, paper work, shiping, getting reloading supplys, etc etc.


So for every 1000 rounds loaded, figure about 3 hours of actually work.

new 223 ammo is ~ $500 / 1000 to start  reman should be a little cheaper. 

So if you want to get in the ball park.

Figure out what it costs you to reload 1000 rounds.  add 25%, then sub tract it from $500 and then divide by 3.   that will give you what you can make in a hour.


As a guess I'd say you might be able to do 1000 rounds with new brass for about 325-350 ish.

[1911 Junkie]

FFL type 6 or 7. $300 for 3 years.

[billt]

I didn't know you needed an FFL. I had one from 1986 until it expired in 1997 after Oklahoma City. After that I got too tired of jumping through their hoops. I renewed it once, then let it die. I know to get one now it requires a business license, and here in Glendale I doubt they'll license a private residence to get one, and even less of a chance the ATF will license the same. Sounds like too much of a PITA. About what I figured.   Bill T.

[Sponsor]

[TAB]

you never know until you ask.  I'd bet getting the FD to sign off it would be the hardest part.

[WatchManUSA]

Over on GlockTalk there is a thread discussing getting into the reloading business.  One guy over there started one and shares the process.  Here is the link.

http://glocktalk.com/forums/showthread.php?t=1074176

[fightingquaker13]

If you do this, you really wnt to incorporate for liability. A chapter S crporation is easy to set up, you can do it yourself or a lawyer can do it for you for a low fixed price. I'd go with the lawyer though because for them, its as routine filing a will and you want it done right. Credit carsd? Just use pay pal. Its basically free, or as close as you'll get using credit cards. Or just take postal money orders. No hassel and you just need to go to the bank once a week. As for shipping, you just use those one rate boxes the post office offers, so there's no hassel with figuring out costs. Other than the FFL this should be cheap and easy to set up.
FQ13

[Pathfinder]

If you do this, you really wnt to incorporate for liability. A chapter S crporation is easy to set up, you can do it yourself or a lawyer can do it for you for a low fixed price. I'd go with the lawyer though because for them, its as routine filing a will and you want it done right. Credit carsd? Just use pay pal. Its basically free, or as close as you'll get using credit cards. Or just take postal money orders. No hassel and you just need to go to the bank once a week. As for shipping, you just use those one rate boxes the post office offers, so there's no hassel with figuring out costs. Other than the FFL this should be cheap and easy to set up.
FQ13

Oooooo, close but no ceeegar!

Sub-Chapter S is very weak, it leaves you personally liable in the event the insurance isn't enough. So you stand to lose the house, car, retirement fund and everything else if a lawsuit goes very badly wrong. IIRC, Hornady just got sued for a blow-up in NY, but I am sure they aren't worried at a personal level. With S-corp, you will be worried.

Better to look at LLC, which does require more people to be involved. It has the pluses of the S-corp as well as from the full-corp, without the limitations of either.

[twyacht]

Any Lawyers Here? c'mon billt, we have to have some standards.....

 

LLC, or even a PLLC can be started at legalzoom.com, with only one person.

the ATF, and the IRS are the ones that you have to get the skinny on...

But I'll take 500 rds. please...