Commercial reloaders

[Baer45]

What are commercial reloaders paying for insurance/liability? I have heard prices from $2500 annually to $18,000. What is correct?

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[rjacobs]

When I talked to a guy who was doing it he said he was paying around 2500 per year per caliber. He didnt break down if he meant per caliber and weight Ex. 9mm, 115g OR simply 9mm. I think he said that was a 1 million dollar policy. If its per caliber and you are loading say 5 calibers(9mm, 40, 45, 223, 300BLK) thats 12500 per year. If its per individual loading, you do the math.

ITS EXPENSIVE.

I figured in machines(camdex for each caliber), enough product sitting on the ground to at least break even, insurance, licensing(06 FFL+ITAR) it was closing in on needing about a million bucks to load 5 calibers. I figured to break even on 115g 9mm it would take almost 900k rounds.

I simply dont know how the guys loading just a little bit on something like a 1050 are doing it.

Edited September 10, 2014 by rjacobs

[mcracco]

I'll bet guys loading on a 1050 are flying without insurance and the ones that load for their own range are covered at a more reasonable rate under the range policy. Just speculating.

[DougCarden]

100000 or less a year is around $2500. It goes up as your numbers and exposure goes up....

DougC

[GARD72977]

What about commercial bullet casters that do not load anything?

[freakshow10mm]

$2500 is what I pay as a commercial loader. One million dollar policy and it covers all calibers. The per caliber guy is getting screwed.

I paid a little less when I only casted bullets.

I load on a 1050 and making money. Small guys have to find a niche. Some of my ammo I made $600 profit on a case of a K rounds selling retail direct. Now I am wholesale only.

[freakshow10mm]

I'll bet guys loading on a 1050 are flying without insurance and the ones that load for their own range are covered at a more reasonable rate under the range policy. Just speculating.

Some probably do but I certainly know for a fact that doesn't apply to ALL of the commercial loaders using a 1050 are just flying without insurance.

[freakshow10mm]

I simply dont know how the guys loading just a little bit on something like a 1050 are doing it.

It's easy to make money with ammo and a 1050. Right now one of the fad cartridges is the 300 BLK. Here's some numbers:

Brass $46/K

Primers $21/K

Powder $55/K

Bullets $155/K

That's all shipped prices, including any haz mat fees and the bullets are 125gr Sierra MatchKing HP-FB. $277/K cost.

Ammoseek search shows that same load in formed/converted brass is $740/K at the cheapest price. $463 gross profit. Half hour to convert brass, hour to load, half hour inspection and packaging. Two hours per K. Load and sell 10K per week, it's $4,630 gross profit per week or $240,760 annual. Divide by 12 and average $20,063 profit a month.

That's for one caliber, one load, Dillon 1050, and 20 hours of loading per week. 520K rounds of ammo a year. If you're home based you will have very little overhead. ITAR is $2750 a year, FFL is $10 a year for the 06 (I'm an 07 so it's $50/yr), insurance is $2,500 a year. $5,260 a year for paperwork stuff. Let's face it, if five grand in expenses will make or break your business venture, you aren't going to make it. Eleven percent FET so figure about $26,000 in taxes for excise tax and you're still making around $200,000 a year working 20 hours a week.

Or you can get 9mm brass for $20/K, primers for $21/K, powder for $8/K, and 147gr coated cast bullets for $60/K. Load up some 9mm subsonic ammo and market it as a 9mm minor load too. Cost is $109/K and you can easily retail it for $300-325/K. A lot less labor than 300 BLK and with a minimal investment in a bullet feeder, you can load 2K per hour on a 1050 and generate about $382-432 profit in that hour. Load 20 hours a week and make almost $9,000 profit.

That's how the little guys are doing it with a 1050. I've been loading commercially since 2006 and have loaded a lot of different cartridges. Even got rid of some only to return to them a few years later. I can react quicker to the changes in the market than the big guys. Advantage of being the little guy.

[Baer45]

Are ther any insurers other then through the NSSF? Doug, thanks..it appears it's up 2,500 per 100,000 rds annually. We estimate 800,000 and it was 22,000$ or 18k can't remember which...for two caliber's...I'll get up with you and send a Check...c

[freakshow10mm]

There are a handful of companies.

[RDA]

I simply dont know how the guys loading just a little bit on something like a 1050 are doing it.

It's easy to make money with ammo and a 1050. Right now one of the fad cartridges is the 300 BLK. Here's some numbers:

Brass $46/K

Primers $21/K

Powder $55/K

Bullets $155/K

That's all shipped prices, including any haz mat fees and the bullets are 125gr Sierra MatchKing HP-FB. $277/K cost.

Ammoseek search shows that same load in formed/converted brass is $740/K at the cheapest price. $463 gross profit. Half hour to convert brass, hour to load, half hour inspection and packaging. Two hours per K. Load and sell 10K per week, it's $4,630 gross profit per week or $240,760 annual. Divide by 12 and average $20,063 profit a month.

That's for one caliber, one load, Dillon 1050, and 20 hours of loading per week. 520K rounds of ammo a year. If you're home based you will have very little overhead. ITAR is $2750 a year, FFL is $10 a year for the 06 (I'm an 07 so it's $50/yr), insurance is $2,500 a year. $5,260 a year for paperwork stuff. Let's face it, if five grand in expenses will make or break your business venture, you aren't going to make it. Eleven percent FET so figure about $26,000 in taxes for excise tax and you're still making around $200,000 a year working 20 hours a week.

Or you can get 9mm brass for $20/K, primers for $21/K, powder for $8/K, and 147gr coated cast bullets for $60/K. Load up some 9mm subsonic ammo and market it as a 9mm minor load too. Cost is $109/K and you can easily retail it for $300-325/K. A lot less labor than 300 BLK and with a minimal investment in a bullet feeder, you can load 2K per hour on a 1050 and generate about $382-432 profit in that hour. Load 20 hours a week and make almost $9,000 profit.

That's how the little guys are doing it with a 1050. I've been loading commercially since 2006 and have loaded a lot of different cartridges. Even got rid of some only to return to them a few years later. I can react quicker to the changes in the market than the big guys. Advantage of being the little guy.

You can't get 125gr Sierra MatchKing HP-FB bullets for $155 for 1,000. I'd buy a few thousand if I could get them at that price.

2 hours total time per 1,000 300 BLK on a 1050 including forming and prepping brass, loading, QC, and packaging seems awfully ambitious.

Also, if you can sell 147 coated cast 9mm for $300-$325 per 1,000, you are lucky. You can buy Speer/Remington/Winchester 147 FMJ for less than that and lots of 9mm minor factory ammo for a good bit less than that.

[freakshow10mm]

You can't get 125gr Sierra MatchKing HP-FB bullets for $155 for 1,000. I'd buy a few thousand if I could get them at that price.

2 hours total time per 1,000 300 BLK on a 1050 including forming and prepping brass, loading, QC, and packaging seems awfully ambitious.

Also, if you can sell 147 coated cast 9mm for $300-$325 per 1,000, you are lucky. You can buy Speer/Remington/Winchester 147 FMJ for less than that and lots of 9mm minor factory ammo for a good bit less than that.

Yes I can and I do. That bullet price is available only to OEM manufacturers that have an 06 or 07 FFL and signs a exclusive use contract. I can buy them at that price but I can only use them for my branded ammunition. I cannot sell them as a component, even to another 06 or 07 FFL.

When you process and form brass in one pass, load, check and package every day 7 days a week, you get efficient at it. Even if you wanted to add an hour to that, 10K rounds a week is still only 30 hours a week. You can knock that out in 3 10-hour days and have a 4 day weekend every week.

Sure you can buy cheaper ammo. It will be dirty, inaccurate, and inconsistent. If you want to compete with that, go ahead. Remember this is niche market. You aren't competing with the Big 5 on price. If you want to make good money reloading, you won't want to make cheap ammo. You'll be leaving money on the table. That's why there is no race to the bottom with 300 BLK ammo. It's slowly coming down in price but it's a big ship to turn. If I really wanted to, I could put out a FMJ load to retail at $375/K, but I'd rather price it at the highest the market will bear and make a few hundred dollars profit on a case rather than $75 profit on a case. The $75 profit a case days are coming, but while it's still in demand more than can be supplied, the price will continue to be high for a while. It will be a few years before it's anything close to M193 prices.

You can buy 357 Mag jacketed ammo for less than what Buffalo Bore sells their 185gr cast loads, but they still sell a lot of ammo and they're making $700+ profit per case selling retail direct. Price isn't everything. The customers that shop only based on price are not customers I want. They are high maintenance and aren't profitable.

[glenr]

Local commercial reloader, Macomb county Mi area (us trolls since we live under the bridge) Rather than the youpper! He has a rental bay in a strip shop building, a number of full and part time employees, a large number of Dillon's running at top speed it sounds like, when I have been there over 12 units. He sells to gun shops and does gun shows. I know nothing about his business other than his expenses are higher than what freak is talking about. And he seems to be getting a good return.

As they are buying primers by the standard wood pallet load. And that is probably north of 7 figures of primers.

So it can be done

[Brassaholic13]

$46/1k of .300 blk brass... Now that's funny. I convert brass for a living, and no frickin way am I selling it to anyone that cheap. It's 13.7 lbs for 1000 pieces of once fired. Average price at scrap auctions are $2.00-$2.40/lb. That puts the RAW brass around $27.40 to $32.88 per 1k, with ZERO scrap. Not even Mexican labor will let you sell it that cheap. Must be some Chinese immigrant labor.

Anyhow, the NRA has some good partners for insurance. $2500/yr was what I was quoted for up to 100k rounds, as someone previously said.

[rjacobs]

Ive seen auction pricing on large lots of once fired LC 5.56 that would get you into the 4-5c a piece range, but then you arent counting ANY machine wear and tear OR your machine costs OR your time spent converting OR time spent sorting the once fired brass to get all the junk out of it. I dont see how you can fully convert 1000 pieces in 30 minutes and do every process I feel it takes. Hell the tumbler takes an hour before and at least an hour at the end. It takes me ~6 hours to go from start to finish on 3000 pieces of brass(initial stainless tumble, convert, second stainless tumble).

[freakshow10mm]

$46/1k of .300 blk brass... Now that's funny. I convert brass for a living, and no frickin way am I selling it to anyone that cheap. It's 13.7 lbs for 1000 pieces of once fired. Average price at scrap auctions are $2.00-$2.40/lb. That puts the RAW brass around $27.40 to $32.88 per 1k, with ZERO scrap. Not even Mexican labor will let you sell it that cheap. Must be some Chinese immigrant labor.

Anyhow, the NRA has some good partners for insurance. $2500/yr was what I was quoted for up to 100k rounds, as someone previously said.

I buy 5.56 brass for $46/k shipped and convert to 300 blk myself. I also convert brass and sell it.

[freakshow10mm]

Ive seen auction pricing on large lots of once fired LC 5.56 that would get you into the 4-5c a piece range, but then you arent counting ANY machine wear and tear OR your machine costs OR your time spent converting OR time spent sorting the once fired brass to get all the junk out of it. I dont see how you can fully convert 1000 pieces in 30 minutes and do every process I feel it takes. Hell the tumbler takes an hour before and at least an hour at the end. It takes me ~6 hours to go from start to finish on 3000 pieces of brass(initial stainless tumble, convert, second stainless tumble).

The brass I buy is hand sorted, machine inspected, and cleaned LC 5.56. I process and convert on one toolhead and load on another. Been doing it for several years.

Machinery and maintenance is a cost of doing business. The machine was purchased in 2009 for $1250 new and more than paid for itself already. Maintenance is minimal and not expensive at all, less than $500 a year. I don't have to clean prior to converting because I buy sorted, inspected, cleaned brass to convert. Conversion is done in one pass and takes a half hour to run 1,000 pieces through the press and gauge them.

I don't draw a salary, so there is no wage to pay. Time is considered in the markup and why I charge a profit. Price is based on component cost only, marked up to the highest price of the current market. Maintenance and administrative costs come out of the gross profit. Rather than thinking like an employee and worrying about hourly rate of labor, I think about the profit generation per hour. I am running this business to make as much of a profit as I can.

Time is money. I spend less time and make more money. If it took 6 hours to process and prep 3,000 pieces of brass, it wouldn't be worth my time.

[GDIS46]

Where do the small reloaders sell their products? Gun shops or ranges?

[freakshow10mm]

Gun shops, gun shows, local ranges, and online. When i started my business back in 2006, I did online sales and sold to the local gun shop. I used local gun shows to promote my ammo. I also reload for all the local LE agencies.

This year I changed to wholesale only. I don't do anything retail (I don't even do gun transfers anymore). I sell my ammo only to licensed FFLs and direct to law enforcement agencies.

[bajadudes]

Freakshow is 100% spot on, 90% of our business is competitive shooters that value quality over price. We do make one line of economy polymer bullet ammo that is mostly sold to local ranges.

You have to find your niche. You can't compete on price with the big guys.

For instance Chris Tilley buys almost 20K worth a month from us and will be shooting our 38 Supercomp in this years world shoot. We also supply the Venezuelan national IDPA team when they are in the USA.

We load on 3 1050's, two with auto-drives that we usually only use when we do runs of the poly stuff. When we are doing a run for a shooter it's hand cranked.

Liability insurance for the FFL-06 up to 1 million rounds & the building for fire and theft runs us $5,500 a year.

Edited September 13, 2014 by bajadudes

[Brassaholic13]

Don't forget ITAR... $2500.00 a year whether you're exporting or not!

[Nimitz]

Freakshow10mm ...

On ave, how many total rounds a week are you making?

[freakshow10mm]

Don't forget ITAR... $2500.00 a year whether you're exporting or not!

It's the cost of doing business. Got to pay to play.

[freakshow10mm]

Freakshow10mm ...

On ave, how many total rounds a week are you making?

Varies with the seasons but ranges 15-25 K per week. I load a lot of 9mm subsonic for wholesale to small gun shops and small suppressor msnufacturers. Also load 300 blk and heavy 223/5.56.

[Baer45]

A stupid question, but you do have to separate the 223 from 556 cases, don't you?

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