A gun manufacturing company is involved in the designing and manufacturing of small weapons (including shotguns, rifles, revolvers, pistols, machine guns, and grenade launchers), ammunition, artillery, and accessories. Data made available by the U.S. government shows that the market size, measured by revenue of the Guns & Ammunition Manufacturing industry, is $18.2 billion in 2023 and the market size of the industry is expected to decline -1.3 percent in 2023.

There are about 725 gun manufacturing companies in the United States responsible for employing 53,750 people and the industry is the 409th largest in the United States.

Steps on How to Start a Gun Manufacturing Company

  1. Conduct Market Research

If you are considering starting a gun manufacturing company, you would need reliable market research to be able to maximize profits from the business. The first step in the market research process for your gun manufacturing company should be to develop market-based research questions in line with your overall business goal and objective.

In this regard, you should source information that will help you maximize your business, give you reliable information of what your potential market will be looking for from a gun manufacturing company, and also help you operate your gun manufacturing company profitably.

a. Who is the Target Market for Gun Manufacturing Company?
  • The US government, especially the Department of Defense
  • Other security companies
  • Individuals and hunters
  • Gun ranges
  • Firearm retailers
  • Foreign governments.
b. Is Gun Manufacturing Company a Profitable Business?

Yes, the gun manufacturing business is quite profitable but is important to note that in recent times, much of the industry’s revenue performance has ebbed based on the often-divergent trends in the civilian and military markets. So also, the recent COVID-19 pandemic has made the manufacturing and retail of firearms more challenging as operators seek to establish workplace wellness and safety policies.

Please note that revenue for the Guns and Ammunition Manufacturing industry has grown 16.7 percent in 2020 alone then 5.8 percent in 2023, as the industry was categorized as essential critical infrastructure and permitted to continue operating by the Department of Homeland Security.

c. Are There Existing Niches in the Industry?

No, there are no existing niches when it comes to the gun manufacturing business but is important to note that a gun manufacturing company may decide to specialize in any of the following;

  • Ammunition (except small arms) manufacturing
  • Artillery and tank ammunition manufacturing
  • Machine guns manufacturing
  • Shotguns and rifles manufacturing
  • Handgun manufacturing
  • Gun magazines manufacturing
  • Small arms ammunition manufacturing
  • Grenade manufacturing
  • Mines manufacturing
  • Howitzers and man-portable and vehicle installed rockets and rocket launchers manufacturing
d. Who are the Major Competitors?
  • General Dynamics Corporation
  • BAE Systems PLC
  • Northrop Grumman Corporation
  • Olin Corporation
  • Smith & Wesson Brands Inc.
  • Sturm, Ruger & Company Inc.
  • American Outdoor Brands (US)
  • Colt (US)
  • National Presto (US)
  • Remington Outdoor (US)
  • Vista Outdoor (US)
  • Beretta (Italy)
  • FN Herstal (Belgium)
  • Glock (Austria)
  • Heckler & Koch (Germany)
  • Kontsern Kalashnikov (Russia)
  • Norinco (China)
  • Taurus (Brazil)
e. Are There County or State Regulations or Zoning Laws for Gun Manufacturing Company?

Yes, there are county or state regulations or zoning laws for a gun manufacturing company. Federal gun manufacturing laws apply to persons engaged in the assembly of guns for-profit and livelihood. If you desire to engage in the business of manufacturing firearms, you will be using the ATF Form 7 to apply, just like you would if you were desiring to do business as a “dealer”.

You must be 21 years of age or over, pay the required fee, and not otherwise be a prohibited person. The applicant must also have premises from which he conducts business. Please note that Federal law allows people who are not prohibited from owning firearms to manufacture them for personal use. Certain types of guns, including those with short barrels, require a tax payment and approval from the Bureau of Alcohol, Tobacco, Firearms, and Explosives.

f. Is There a Franchise for Gun Manufacturing Company?

No, there are no franchise opportunities for a gun manufacturing company.

g. What Do You Need to Start a Gun Manufacturing Company?
  • A Feasibility Report
  • Business and Marketing Plans
  • Business Licenses and Permits
  • Business Facility
  • BATF manufacturing license (Type 07 Manufacturer of Firearms other than Destructive Devices)
  • Startup Capital
  • Insurance
  • EIN (Employer Identification Number)/Federal Tax ID Number.
  • A Corporate Bank Account
  • Employees
  1. Memorable Gun Manufacturing Business Names

  • Gun Nest© Manufacturing, Inc.
  • Brest Guns® Manufacturing, LLC
  • Bally Tryone© Firearm Manufacturing Company, Inc.
  • Gun Solutions® Firearm Manufacturing Company, Inc.
  • Firearm King™ Gun Manufacturing Company, Inc.
  • Green Group™ Gun Manufacturing Company, LLC.
  • Luke Elton and Co© Gun Manufacturing Company, LLC
  • Milton Jones® Gun Manufacturing Company, Inc.
  • 007© Gun Manufacturing Company, Inc.
  • Che Nelson© Gun Manufacturing Company, Inc.
  • Gunners® Gun Manufacturing Company, LLC
  • Red Group® Gun Manufacturing Company, LLC
  • Convoy™ Gun Manufacturing Company, LLC
  • Fred Junes© Gun Manufacturing Company, Inc.
  • Amour Rise® Gun Manufacturing Company, Inc.
  • Don Pedro™ Gun Manufacturing Company, Inc.
  • R Tenor™ Gun Manufacturing Company, Inc.
  • Leo Defense© Gun Manufacturing Company, Inc.
  • Big Network® Gun Manufacturing Company, LLC
  • The Revolver™ Gun Manufacturing Company, Inc.
  1. Register Your Business

a. What Type of Business Structure is Best for Gun Manufacturing Company?

Even though there are several options such as sole proprietorship, partnership, limited liability company (LLC), and corporation, when it comes to the business structure for a gun manufacturing company, the one that most players consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.

Please note that an LLC will need an EIN if it has employees or if it will be required to file any of the excise tax forms listed below.

b. Steps to Form an LLC
  • Choose a Name for Your LLC.
  • File Articles of Organization.
  • Choose a registered agent.
  • Decide on member vs. manager management.
  • Create an LLC operating agreement.
  • Comply with other tax and regulatory requirements.
  • File annual reports.
c. What Type of License is Needed to Open a Gun Manufacturing Company?
  • General Business License
  • BATF manufacturing license (Type 07 Manufacturer of Firearms other than Destructive Devices)
  • Dealers’ License
  • Zonal Permits
  • Signage Permit
  • Operational State Facility Inspections
d. What Type of Certification is Needed to start a Gun Manufacturing Company?

You don’t need any certifications to start a gun manufacturing company. But it will be to your advantage to own an Advanced Gunsmithing Certification and Certification in Firearms Technology.

e. What Documents are Needed to Open a Gun Manufacturing Company?
  • DBA
  • EIN
  • Business and liability insurance
  • Federal Tax Payer’s ID
  • State Permit and Building Approval
  • Certificate of Incorporation
  • BATF manufacturing license (Type 07 Manufacturer of Firearms other than Destructive Devices)
  • Dealers’ License
  • Business License
  • Business Plan
  • Employment Agreement (offer letters)
  • Operating Agreement for LLCs
  • Insurance Policy
  • Online Terms of Use
  • Online Privacy Policy Document
  • Contract Document
  • Company Bylaws
  • Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?

Yes, you would need a trademark, copyright, and patent for your gun manufacturing company.

  1. Cost Analysis and Budgeting

a. How Much Does It Cost to Start a Gun Manufacturing Company?

The startup cost for a gun manufacturing company is not uniform. But basically, a gun manufacturing company will cost from $200,000 – $600,000 and to even millions of dollars to start and that can easily go higher depending on your overall business goals and objectives.

b. What are the Cost Involved in Starting a Gun Manufacturing Company
  • The total fee for registering the business in the United States of America – $750.
  • Legal expenses for obtaining licenses and permits as well as accounting services totaling – $3,200.
  • Marketing promotion expenses (2,000 flyers at $0.04 per copy) for the total amount of $80.
  • The cost for hiring a business consultant (writing of business plans inclusive) – $4,500.
  • Insurance (general liability, workers’ compensation, and property-casualty) coverage at a total premium – $12,400.
  • The cost of logistics software, accounting software, CRM software, and Payroll Software – $4,500
  • The cost for leasing a facility (long-term lease agreement) – $105,600.
  • The cost for facility remodeling and installations – $40,000.
  • The cost for the purchase of gun manufacturing equipment: $200,000
  • Other start-up expenses including stationery – $10,000
  • Phone and utility deposits will cost – ($2,500)
  • Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $100,000
  • The cost of store equipment (cash register, security, ventilation, signage) – $3,150
  • Purchase of office furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, tables and chairs et al) – $8,000.
  • The cost of launching an official website – $600
  • Miscellaneous – $2,500
c. What Factors Determine the Cost of Opening a Gun Manufacturing Company?
  • The size of a gun manufacturing company (number and types of guns and other firearms you want to manufacture)
  • The choice of location
  • The required licenses and permits
  • The cost of hiring and paying a business consultant and attorney
  • The cost for branding, promotion, and marketing of the gun manufacturing company
  • The cost for furnishing and equipping the gun manufacturing company
  • The cost for insurance policy covers
  • The cost for registering the business
  • Cost of recruiting and training your staff
  • The cost for the purchase and customizing of uniforms
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?

Actually, it is not compulsory to build a new facility for your gun manufacturing company, but, if you have the required finance, it will pay you to build your own gun manufacturing facility and administrative office. The truth is that building or reconstructing a facility will allow you to come up with a facility that will perfectly fit into your overall business goal.

e. What are the Ongoing Expenses of a Gun Manufacturing Company?
  • Raw materials and packaging materials
  • Utility bills (internet subscriptions, phone bills, signage and software renewal fees et al)
  • Salaries of employees
  • Machine maintenance
  • Insurance
  • Marketing costs
f. What is the Average Salary of your Staff?
  • Chief Operating Officer (President) – $68,000 Per Year
  • Plant Manager – $58,000 Per Year
  • Admin and HR Manager – $48,000 Per Year
  • Marketing and Sales Executive (Business Developer) – $42,000 Per Year
  • Accountant – $38,000 Per Year
  • Gunsmiths – $36,800 Per Year
  • Machine Operators – $28,000 Per Year
  • Customer Service Officer (Receptionist) – $26,100 Per Year
  • Security Guard -$24,000 Per Year
g. How Do You Get Funding to Start a Gun Manufacturing Company
  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell shares to interested investors
  • Applying for a loan from your bank/banks
  • Pitching your business idea and applying for business grants and seed funding from the government, donor organizations, and angel investors
  • Source for soft loans from your family members and friends.
  1. Write a Business Plan

a. Executive Summary

Milton Jones® Gun Manufacturing Company, Inc. is a registered and licensed gun manufacturing company that will be based in Brooklyn Park – Minnesota. We are in business to manufacturing a wide range of firearms and accessories for both the United States and international market.

Milton Jones® Gun Manufacturing Company, Inc. has been able to secure all relevant licenses and permits to operate in the United States. We will ensure that we abide by the rules and regulations guiding the firearm manufacturing industry in the United States of America.

b. Products and Service
  • Ammunition (except small arms) manufacturing
  • Artillery and tank ammunition manufacturing
  • Machine guns manufacturing
  • Shotguns and rifles manufacturing
  • Handgun manufacturing
  • Gun magazines manufacturing
  • Small arms ammunition manufacturing
  • Grenade manufacturing
  • Mines manufacturing
  • Howitzers and vehicle-installed rockets and rocket launchers manufacturing
c. Mission Statement

Our mission is to ensure that we build a successful gun manufacturing company that will not just sell firearms in the United States of America but all across the world.

Vision Statement

Our Vision is to become one of the preferred choices of individuals and organizations when it comes to the demand for guns and other firearms in the United States of America.

d. Goals and Objectives

The goals and objectives of a gun manufacturing company are to design and manufacture small weapons (including shotguns, rifles, revolvers, pistols, machine guns, and grenade launchers), ammunition, artillery, and accessories for the government and civilians.

e. Organizational Structure
  • Chief Operating Officer (President)
  • Plant Manager
  • Admin and HR Manager
  • Marketing and Sales Executive (Business Developer)
  • Accountant
  • Gunsmiths
  • Machine Operators
  • Customer Service Officer (Receptionist)
  • Security Guards

Marketing Plan

a. SWOT Analysis
Strength:
  • Excellent operational history
  • Attention to detail.
  • Experience and trained professionals.
  • Large manufacturing facility.
  • Excellent customer testimonials.
  • Reliable and efficient firearm manufacturing process.
Weakness:
  • Not enough existing clientele to run at full capacity immediately
  • The owner is new to large scale marketing
  • We will need a loan to build our facility and to purchase manufacturing equipment
  • The owner is currently running the business solo and will need to manage construction/build out the existing business
  • Lack of economies of scale.
Opportunities:
  • Growing acceptance of firearms in the United States.
  • Build upon existing clientele
  • Online market, new services, new technology, and of course the opening of new markets.
  • Increase in security activities on a global scale.
Threat:
  • Loans diminish profitability until they are paid off
  • The first year will be financially tight while we gain customers and pay off loans
  • Competition in the area could increase
  • Management of employees requires time, money, and efforts
  • The Bureau of Alcohol, Tobacco, Firearms, and Explosives could change its regulatory status and decide to enforce strict regulations that can strangulate our business.
b. How Do Gun Manufacturing Companies Make Money?

Gun manufacturing companies make money by;

  • Ammunition (except small arms) manufacturing
  • Artillery and tank ammunition manufacturing
  • Machine guns manufacturing
  • Shotguns and rifles manufacturing
  • Handgun manufacturing
  • Gun magazines manufacturing
  • Small arms ammunition manufacturing
  • Grenade manufacturing
  • Mines manufacturing
  • Howitzers, vehicle installed rockets, and rocket launchers manufacturing
c. Payment Options
  • Payment via bank transfer
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via check
  • Payment via mobile money transfer
  • Payment via bank draft
d. Sales & Advertising Strategies
  • Introduce your gun manufacturing company by sending introductory letters alongside your brochure to The US government, especially the Department of Defense, corporate organizations who are into security, firearm merchants, gun shops, gun ranges, and key stakeholders in and around your city and state
  • Use friends and family to spread the word about your business
  • Post information about your company and the products you sell on bulletin boards in places like libraries, local coffee shops et al
  • Place a small or classified advertisement in the newspaper, or local publication about your company
  • Leverage on referral networks such as gun dealers that will attract clients who would need your products
  • Advertise your business in relevant magazines
  • Attend relevant expos, seminars, and business fairs et al to market our firearms
  • Engage in direct marketing approach
  • Encourage the use of word-of-mouth marketing from loyal and satisfied clients

Financial Projection

a. How Much Should You Charge for your Product?

Most gun manufacturing companies sell their firearms based on the type and size. There is no fixed price on a firearm.

b. How Much Profit Do Gun Manufacturing Company Owners Make a Year?

It depends, but available reports show that on average, a gun manufacturing company should net more than $120,000 per year assuming they have a steady clientele.

c. What Factors Determine the Amount of Profit to Be Made?
  • The capacity of the gun manufacturing company (number of guns and other firearms to be manufactured)
  • The location of the gun manufacturing company
  • The management style of the gun manufacturing company
  • The business approach of the gun manufacturing company
  • The advertising and marketing strategies adopted by the gun manufacturing company.
  • The number of years the gun manufacturing company is in business
d. What is the Profit Margin of a Gun Manufacturing Company?

The profit margin of a gun manufacturing company is not fixed. It could range from 8.5 percent to 11 percent.

e. What is the Sales Forecast?

Below is the sales forecast of a gun manufacturing company. It is based on the location of the business and other factors as it relates to such startups in the United States;

  • First Fiscal Year (FY1): $320,000
  • Second Fiscal Year (FY2):  $580,000
  • Third Fiscal Year (FFY3): $1.15 million
  1. Set Up your Office

a. How Do You Choose a Perfect Location for Gun Manufacturing Company?
  • The demography of the location especially as it relates to security activities
  • The demand for guns and other firearms in the location
  • The purchasing power of businesses and residents of the location
  • Accessibility of the location
  • The number of gun manufacturing companies in the location
  • The local laws and regulations in the community/state
  • Traffic, parking and security et al
b. What State and City are Best to Open a Gun Manufacturing Company?
  • Huntsville, Alabama
  • Fort Smith, Arkansas
  • Atlanta, Georgia
  • Idaho Falls, Idaho
  • Tucson, Arizona
  • Orlando, Florida
  • Fort Wayne, Indiana
  • Fairbanks, Alaska
  • Jefferson City, Missouri
  • Baton Rouge, Louisiana
c. What Equipment is Needed to Operate a Gun Manufacturing Company?

You should be prepared to purchase Gun Drilling Machines, Pull Reaming Machines, Button Rifling Machines (small caliber 0.22 to 50 BMG), Cut Rifling Machines (small caliber 0.22 to 50 BMG), Vertical Honing Machines, Facing and Chamfering Machines and Barrel Straightening Presses. et al. So also, you will need computers and laptops, internet facility, telephone, fax machine and office furniture (chairs, tables, and shelves) amongst others and all these can be gotten as fairly used.

  1. Hire Employees

When it comes to hiring employees for a standard gun manufacturing company, you should make plans to hire a competent chief executive officer (you can occupy this position), admin and HR manager, plant manager, marketing and sales executive (business developer), accountant, engineers and gunsmiths, machine operators, customer service officer (receptionist) and security guards.

  1. Launch the Business Proper

You may not need to throw a party to officially launch the business because gun manufacturing is usually a discreet business. You only need to make sure you fulfill all the legal needs for starting such a business, then you can start contacting your buyers.

a. What Makes a Gun Manufacturing Company Successful?
  • Choose a good location to launch the business
  • Come up with unique designs for your guns and other firearms
  • Partner with government
  • Hire only competent, hardworking, and trustworthy staff
  • Be deliberate with your marketing sales approach
  • Encourage the use of word of mouth to promote your gun manufacturing company
  • Leverage on all available online and offline platforms to promote your gun manufacturing company
b. What Happens During a Typical Day at a Gun Manufacturing Company?
  • The business is open for the day’s work
  • The production line (factory) swings into action
  • Customer’s requests are taken and they are scheduled or attended to
  • Scheduled maintenance of equipment and machinery is carried out
  • Marketing/website upkeep
  • Supply ordering
  • Administrative duties
  • The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Gun Manufacturing Company?
  • Good gunsmith and engineering skills
  • Customer services skills
  • Interpersonal skill
  • Business management skills
  • Work experience in the firearm manufacturing industry
  • Experience in managing people
  • Experience in business administration
  • Experience in handling different types of firearms.