As I write this, it’s too late for the Texas Gun Pros gun store, although our training will continue at locations to be announced. After seven years of what started out to be a great run, we are closing our store. Our loyal customers want to know why, so I’ll explain it. I’m going to give you the bullet points up front. Detail will follow.
- We didn’t have a gun range.
- We didn’t have enough capital to sustain a long-term slump.
- The gun industry as a whole is in a slump that began around the first of November 2016.
- Gun buying is changing to the point where it is difficult for a local retailer to compete with online retailers who somehow manage to sell guns at or below our wholesale cost.
- Gun Shows. Around here there seems to be a Gun Show somewhere every weekend. Whether true or not, shoppers seem to feel they can get a better deal at a gun show. But they don’t mind doing their research at the local gun shop first.
The Gun Range Issue
From the first day we opened in April 2010, the majority of the calls or email inquiries we got were about our gun range, the one we didn’t have, but Google seemed to think we did. Funny thing about a gun range. We have wanted one for years. I grew up country and the idea of paying other people so I could shoot is foreign to me. We used to drive by this place on I-35 that was vacant and every time we’d drive by I’d think, “That would be a good place for a gun range.” One day, a couple of years after I started doing this, a sign went up: Shoot Smart Gun Range.
A couple of blocks down the street from our first location was an empty Expo building. My son Phillip and I put together a business plan to convert it to a Main Event of shooting ranges. Our plan called for 60 lanes of handgun, 12 lanes of rifle, 6 classrooms, a large retail store, a gunsmith, indoor paintball, a shooting gallery for kids, a large media-enhanced meeting room for events and a restaurant. The cost, if we could purchase the building reasonably would be about $7 Million. Not having a clue where to go to find that kind of money, since we had no history of development, we put the plan on the shelf. Then one day out of the blue, a financial guy I had helped with a web project several years earlier called me and said he was bird dogging for some private investors and wanted to know if I knew of anyone who had a project they could look at. I knew him and knew his integrity. He presented my plan and the investors said they’d never seen one so well-written. They verbally committed and followed up with a Letter of Intent. Meanwhile, someone else bought the Expo building.
We turned our attention to an outdoor range. An old friend in the Real Estate Development arena turned me on to a piece of property in the heart of the Metroplex that was for sale cheap. I mean really cheap, because it’s in a flood plain. We loved it and figured how to overcome the flooding issue. We obtained a signed loan agreement from the private investors, put down earnest money, incurred legal fees, had engineers do feasibility studies, had architects design a building, got approvals from US Fish & Wildlife regarding lowland marsh areas, and then we were stood up at closing by our lenders. What had seemed too good to be true turned out not to be true. We battled for years, we spent a ton of money. This place was going to be the shooting adventure park all America would love. Indoor and Outdoor Pistol Ranges; Indoor Rifle Range; Archery, Paintball plus all the other stuff we had envisioned for the Expo Building.
In the end, the money didn’t come through, we had expended all of our savings, 401k, profits from the gun business, credit cards, etc. trying to make a gun range happen. We couldn’t do it.
Capital
I’ve been part of several startup companies that were successful enough to be sold to large corporations. From those experiences I came to believe the way to grow a company was to bootstrap it from its own earnings. Apart from what I now call the Gun Range Fiasco, that’s what we did with Texas Gun Pros. It started with a dream of mine to be a CHL Instructor as a part-time endeavor. Jerry Colliver, a friend from work, decided he wanted to do that as well. So in 2010 we started teaching CHL, NRA Basic Pistol and Texas Hunter Education Courses. In April, 2011 we rented a facility on Davis Blvd. to teach those classes and made arrangements with the Shooting Gallery in east Ft. Worth to do the shooting portion of the classes at their range. It wasn’t long before people in our classes started asking us about guns. We obtained an FFL license and started selling guns from a little side room in what was originally designed to be just a classroom.
During the years 2010 to the end of 2016, we trained over 11,000 students and sold somewhere close to 1800 guns. The guns, displayed in a 300 sq. ft. side room to the classroom, easily equaled about 70% of our revenue. Sales growth was steady. In fact, sales almost doubled between 2012 and 2013, then again between 2013 and 2014. We needed to expand. We felt we had to separate the classroom from the gun store to avoid class interruption, plus we required more space for inventory. Our existing landlord wasn’t able to accommodate us, plus someone else was doing at least part of our dream almost in our front yard at the Expo building. A move seemed in order. Somewhere during this time, Jerry Colliver became so involved in his work in the insurance industry that he stepped aside. My son Phillip, an entrepreneur at heart, stepped in to run the gun store. He was responsible for bringing on board Jerry Lonon, Ryan Bruntz and Sal Castilleja as store employees. Phil Epps, who just passed away in March and Richard Balestrieri were on board as CHL/LTC Instructors.
We wanted to stay in the North Richland Hills area, but being right at the corner of Keller, NRH, Southlake and Colleyville and in a high traffic area couldn’t be bad, right? Even though the rent was four times what we’d been paying? Wrong. Almost nobody comes in our store these days. When they do, they rarely buy. Our income dropped off a cliff. When I say dropped, since the election, our monthly gross receipts have been approximately 1/3 of what they were in 2015. Less than the rent. Less than the payroll. Less than what we have to pay suppliers for the merchandise. Far less, and the hole was getting deeper every day. We were borrowing at a very high rate just to keep the doors open until things turned around.
The Gun Industry as a Whole
From the manufacturers on down, the industry is suffering a major setback since the November 2016 election. The candidate who loves guns and gun owners got elected, so what happened? I’m not sure we have it all figured out, but I’ll summarize our thoughts:
- The pressure is off. As a whole, politicians won’t be trying to take away our rights to buy and own guns for a while.
- Prior to the pressure being off, many people bought more guns than they could afford. They’re still paying off credit cards for them. They evidently now believe they don’t need any more guns.
- Society has its head in the sand regarding what many of us believe are rough days ahead. In those days, it will be more important than ever for individuals and families to be able to defend themselves and their property.
- Manufacturers, I believe, are doing the wholesale and retail industry a disservice by providing many new guns, each with a number of options, each year. Nobody can stock them all, but the gun buyers who are still buying want their particular choices once they know those choices are available.
Gun Buying Today
Some guns are being sold. There are still newcomers to the fold and there are still collectors. Today’s shoppers, as a whole, have no understanding of business. They believe no one should make a profit, not understanding that margin, the difference between what the retailer buys a product for and what he sells the product for is necessary to pay rent, salaries, utilities and hopefully, a little ROI. Nope, can’t have that from me! You’ve got to get that from somewhere else. Therefore they’re always looking for the cheapest price, with no regard for their local store.
A common occurrence–way too common–a person walks in the store and starts asking about guns. They’ll spend anywhere from 30 minutes to an hour examining and handling our products, asking questions of our salespeople (who are all certified instructors), and instead of buying the gun they want from us, will turn around, walk out the door and order it online or buy it at a gun show. A few days later it shows up at our place for a transfer, or they come back to us for training for this fine new gun they bought at a gun show for pretty much the same price we had on it.
For the online purchases, we, or some other dealer, charge a transfer fee, and the buyer paid freight, so in the end they didn’t really save any money. But they did help a dealer in Kentucky stay in business while a dealer in their own backyard is struggling. If this is you, please think about the consequences. And, if you’re going to buy online, don’t utilize the resources of a local dealer to educate yourself on the product, unless you offer to pay them for their time and expertise. And if you think dealers are making big profit on your purchases, you’re sadly mistaken. Dealers are lucky if they can make a 10% margin on a typical gun sale. So if you buy a $500 gun they paid about $450 for it. That other $50 goes to pay rent, salaries and electricity. If you bought that same gun online, at least $50 is going to go to freight and a transfer fee.
We have closed the store because we were unsuccessful in our efforts to build a gun range in spite of sinking a lot of time and money into the effort, our capital is depleted, and our sales fell off the cliff starting last November. The website will stay open for training and our great instructors will still be available. When September hits, I hope to have an online certification process for the new online License to Carry training.
For those of you who were faithful and steady customers and for all your kind words, thank you! For those of you who came into our store in our closing days with somewhat hurtful comments about our failure, you have the same opportunity we did. Go and do it better. I’ll promise to shop at your store and NOT buy online or at a gun show.
Update January 2018
I promised to keep the website online and indicated we would be attempting to conduct online classes. Much has changed:
- The gun range we were using in Grapevine has now shut down. Sal Castilleja was teaching classes there and doing business as Guardian7 and I can provide you with his contact details upon request.
- The state has not yet approved my application as an online instructor. The longer they delay the less inclined I am to undertake the effort to produce the courses.
- Pressure on the Texas Gun Pros Corporation from creditors caused us to dissolve the Corporation and with that went the website.
Sorry.
David Freeman 