Market Pulse

Used-Gun Sales
In 2021 & Beyond

Written By Shannon Farlow

2021

Used firearms have always provided an important revenue stream for many shooting sports retailers. Pre-owned guns attract a broad array of customers, ranging from collectors searching for rare models to first-time buyers looking for an affordable path to gun ownership. Then 2020 happened.

The demand for used firearms exploded, leaving FFL dealers everywhere scrambling to meet customer requests. For individuals, locating a specific used firearm at a local shop — say an original Colt Series 70 1911 from the early 1980s — can be as difficult as finding the proverbial needle in a haystack. (I know because I recently searched for that very gun in my hometown.)

As everyday life continues to return to normal, what will this transition mean for the used-firearms market? Are sales as strong today as they were a year ago? Has it become easier for dealers to replenish their inventory? Will the buying spree of 2020 eventually lead to a market flooded with used firearms?

To help answer these questions and more, Shooting Industry spoke with Larry Hyatt, president of Hyatt Guns in Charlotte, N.C.; Jeremy Ball, general manager at Sharp Shooting Indoor Range & Gun Shop in Spokane, Wash.; Patrick Combs, used-firearms buyer for Green Top in Ashland, Va.; and Dave Tobel, co-owner of Capital Sports in Helena, Mont. Here is a behind-the-scenes look at what they’re experiencing at their facilities.

SI: How would you describe your store’s used-firearm sales in 2020?:

Ball: Used-gun sales were very strong in 2020, driven by the overall market and the lack of available new firearms.

Hyatt: Our used-gun sales set records last year and were the most we’ve sold in 62 years.

Combs: Off the charts! Even old stock sold. We got down to our lowest level of used- firearm inventory in at least the last 30 years.

SI: Are used guns continuing to sell as quickly this year?

Hyatt: Yes, we expect another record year in 2021.We are uniquely positioned in that used-gun sales are our primary focus.

Ball: Used guns are continuing to sell very well. We’re currently outpacing 2020 sales and are looking at another great year. Between continued supply issues and actively pursuing used-gun purchases for inventory, we expect this category to grow.

Combs: Yes, very much so. The inventory has been very low. We have seen extremely fast turnaround.

“We’re buying used firearms as fast as we can, but as soon as we put them on our shelves and our website they sell.”

Patrick Combs, Used Firearms Buyer Green Top – Ashland, Va.

SI: How has the ammunition shortage impacted demand for used firearms?

Combs: People are buying used guns from us whether or not we have ammo. You buy the gun when you can, and you buy the ammo when you can. It just might not be at the same time.

Tobel: Ammo has been a real problem both with new and used firearms. Many firearm sales are based on what ammo we have on hand.

Ball: I don’t believe the ammo shortage impacts used guns any more than it impacts new guns. I do believe we might have an issue as an industry as states begin to lift pandemic restrictions and potential customers will look to other activities and shooting sports will fall out of favor if these ammo problems are not resolved.

Hyatt: It hasn’t really affected used-gun sales at all. Now the factories have started to return to normal, we’re starting to see supply levels rise slightly so we hope this will not be a factor going forward.

SI: Is the supply of used firearms beginning to catch up to the demand?

Hyatt: It’s not even close! [Laugh] Though we are still the largest purchaser of used guns in our area, with an unprecedented number of new shooters in the marketplace, demand is significantly outstripping supply.

Combs: No. We’re buying used firearms as fast as we can, but as soon as we put them on our shelves and our website they sell. We currently have less than 100 used guns in stock, where normally it would be close to 1,000.

Tobel: Used firearms are slower coming into the store. Folks are keeping what they have and buying more.

Ball: The supply of used guns is often in flux. Since acquiring them is not the same supply chain we encounter with new guns, we’ve not found ourselves in a position that we were, or are, unable to acquire more used firearms. The demand for them is still very good in most categories. Generally, for us used handguns are the best market.

Dave Tobel shows a customer a vintage Springfield Armory 1911-A1, while a Mauser Model A Sporter in 8x57
(circa 1922) rests on the counter. Tobel sources used guns from estate sales, auctions and online resources.

SI: What sources of used guns do you seek out?

Tobel: We have run promotions to purchase or trade for store credit on firearms and it’s worked okay. We also check the internet, estate sales and auctions — you just have to be careful you have room for margins.

Ball: We advertise we purchase estates and have made connections with assisted-living facilities in the area since most don’t allow residents to store firearms in their facilities.

Hyatt: Our best source of used firearms is from our customer base built up over 62 years of business in the same location. We have also fostered relationships with many collectors over the years, and we’re one of the only shops in the area that specializes in estate planning and buying.

Combs: We do a lot of trades and purchases in the store, but the bulk of the collections are bought off site. The majority of collections we acquire come from estates and the rest, most often, are the result of a collector downsizing due to age or moving to a smaller home. As far as unique, we encounter a lot of hoarders. Just like the “Hoarders” TV series; people do live like that!

SI: Which category of used firearms is selling the best?

Combs: Handguns and tactical sell the quickest. Lots of new shooters these days are not interested in hunting or collecting classic firearms. They are driven more by self-protection.

Ball: Handguns have always been the best category for us.

Hyatt: Handguns remain number one by a large margin. Rare and collectible guns are also strong sellers. Tactical guns have increased slightly, as they continue to gain popularity in the marketplace.

Tobel: Handguns and defensive shotguns are selling best right now. More toward fall, our rifles and sporting shotguns will be picking up. The collector market is a little slow right now.

SI: Is there a single caliber or gauge outperforming the others?

Hyatt: Handgun calibers are led by 9mm, while the most popular rifle caliber is .223/5.56, followed closely by .308. 12 GA shotguns are our biggest seller in the used shotgun space.

Ball: This is really firearm dependent. Largely, the most popular calibers are going to be .22 LR, 9mm and .45 ACP.

SI: Do customers seem driven by brand loyalty, price or another factor?

Ball: Some of our customer base is very interested in specific guns from specific manufacturers. Others are not as picky on the brand and more if they have a hole in their collection they would like to fill. Others are looking for any gun at a specific price.

Hyatt: Some brands do sell better than others at different times of the year. With that said, price and availability seem to be the most important factors among our customers.

Combs: Not so much brand loyalty, but identifying quality brands and models. Midrange price-point firearms seem to be the hottest segment with lots of competition among manufacturers. This provides a segment of firearms that are reliable, accurate, ergonomically designed and affordable to most shooters.

“Some of our customer base is very interested in specific guns from specific manufacturers. Others are not as picky on the brand and more if they have a hole in their collection they would like to fill.”

Jeremy Ball, General Manager Sharp Shooting Indoor Range – Spokane, Wash.

Larry Hyatt with a used LWRCI M6A2. He says price and availability seem to
be the most important factors in which used guns sell best.

SI: How are you promoting your used firearms?

Ball: When COVID began, we pulled all marketing. Due to continued supply issues we haven’t started advertising again. We anticipate this changing over the summer, but many factors will determine if it’s the correct course of action.

Hyatt: Yes. We promote primarily through social media and email marketing. We went all-in on our internet program around 14 years ago and that decision is still paying large dividends, though it was a lot of work to get there.

Combs: Yes, all the above [email, social media, radio ads, etc.]! We take full advantage of using every resource possible, especially to tell people we buy used firearms.

Tobel: We list firearms on our own website and in the newspaper.

SI: Do you think profit margins on used firearms will continue to stay healthy?

Ball: For now, yes. In the back of my mind, it is going to depend on if people keep the millions of guns purchased last year or if they are sold. We will be watching pricing changes closely.

Hyatt: They will. Used guns have a certain uniqueness that make it hard to bargain shop, and margins continue to increase.

Combs: Yes. There are not many times when a retailer has the ability to control cost. Buying used guns fairly, but wisely, always pays off.

SI: Will used guns continue to be an area of growth for dealers?

Hyatt: Yes, but to do it right costs a lot of money. You have to have buyers immediately for the used items you’re taking in. The longer the used inventory sits, the more that capital gets tied up. We’re fortunate because we’ve been in business so long and we have an excellent internet presence. It helps us move inventory quickly.

Tobel: We feel the used market will grow because of the huge amount of firearms sold in the past two years.

Ball: I think used guns will continue to be a growth area. We will continue to focus on this category and work to expand it as we are able to source more firearms.

Combs: Yes, many states such as ours make it difficult for an individual to sell their firearms to another individual, but it is easy to sell them to a licensed dealer. This also provides a sense of comfort to the seller.

SI: Are you planning for some of 2020’s first-time buyers selling back their firearms?

Ball: This is a major question I think depends on the industry’s ability to provide ammo at a price that will entice people to try out those purchases. I think this will have a lasting effect if we don’t get these first-time purchasers engaged with the industry again. During COVID, we developed a new website allowing us to target customers in a more effective manner. Through email and social media, we are putting out offers to these folks to get them in and shooting.

Hyatt: That’s always the product of buying bubbles, so we do expect to purchase quite a few guns bought during the frenzy of 2020.

Tobel: As the world gets back to normal, I think many folks will decide they don’t need as many firearms and move them.

Combs: I believe you may see some sell-off by first-time buyers, but I believe you will also sell more due to the fact a lot of first-time buyers will now want to buy more guns. Most people, once they start shooting, inevitably start buying more guns. Have you ever seen a fisherman with just one fishing rod?

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