ExactlyMyPoint

The (legal) street price of an XD or Glock is about $500. I know that if the government wanted to buy a bunch of them, they wouldn't be paying $500 a piece. I have also seen police/military discounts on Glocks of about $100.

I am not all that familiar with the manufacturing process. Anyone know what the actual cost is of producing a firearm? I know the company has overhead, material costs, etc, etc, etc, but given all that, what does it cost Glock or Springfield to produce one of their pistols? Then, why does it cost so much to buy? Is it taxes, supply/demand, distribution costs, or what?

__________________
- Let me explain. No. There is not time. Let me summarize.
- Doing my part to create a huge carbon footprint
- Be still, and know that I am God; Psalms 46:10
- You are God and that's just the way it is; You Are God Alone sung by Phillips Craig And Dean

farronwolf

Well to find that out just go find out how many firearms that Springfield manufactured last year. Take their gross sales, subtract the profit for the company for the year, then devide that by the number of firearms produced. That should be the cost per firearm.

The number of items that a company has to deal with, insurance, employee benefits, taxes, property, and plant maintenance, utilities, even stockholder dividends, anything you can think of all goes into the cost of a firearm. If they company doesn't cover all the cost involved they will not be in business very long.

This is why some firearms cost more than others, (for mass produced items). Taurus is less expensive than a Glock or Sig, whatever, mostly because thier overhead is going to be less because of where they are built.

__________________
Just remember that shot placement is much more important with what you carry than how big a bang you get with each trigger pull.

JD

You left out one big key part of sales.


PROFIT

__________________


Looking for something else to read? Check out the DefensiveCarry.com Blog Section

Forum Customs & Courtesies

Forum Usage: Tips and Tricks

SIXTO

legal departments suck up a lot of profit too.

__________________
In a land of sheep, even a toothless wolf is king.

Wake Up! The zombie invasion has begun years ago.

Reborn

Several years ago about 5 or 6; I destoryed a 40 cal. Glock. I was still an LEO at the time and called Glock. They sold me a replacement for $237.00 bucks. They said the prices of guns are the result of law suits.

__________________
Psalms 144:1
Blessed be the Lord my strength, which teacheth my hands to war, and my fingers to fight.
Senior Instructor for Tactical and Defensive of Texas
CHL INSTRUCTOR
Retired LEO
NRA member
TCHA member

houndawg75

As with the manufacture of any product there is a lot of overhead involved. With guns in particular, I would imagine their equipment maintenance costs are fairly high due to having to keep their tolerances on machined parts fairly tight. That would explain why higher quality firearms cost more. Less tolerance would require more frequent calibration and maintenance. Also keep in mind the metals used in production are commodities traded on the world market. Since gun prices tend to remain fairly stable, they have obviously built in enough margin to keep from having to increase their prices as frequently as the oil market. I think what you are really asking is the time and materials cost associated which would not really be a fair assessment of total cost. You have to include employees, benefits, maintenance, facilities, equipment, marketing, and about 9,000 other factors. It would be hard to get that information from anyone outside the company. You may try and research the publicly traded companies and get a copy of their annual reports. It may give you more insight as to what you are looking for.

Captain Crunch

Don't forget that gun makers must pay an 11% Federal excise tax for every firearm produced.

__________________


"Just be nice...or I'LL SHOOT"!

Terry

JonInNY

There's also liability insurance that they need to pay.

For example, have you ever looked at the prices for ordinary ladders? They cost 20x production cost becuase they need to buy liability insurance for the idot that falls of the top step and sues for faulty design. It has happened.

I'm not sure how successful a lawsuit would be for an AD where someone gets hurt, but if something truly does go wrong with a firearm, they need to cover their proverbial butt.

I'm sure that increases the selling price.

__________________

• "The right of voting for representatives is the primary right by which all other rights are protected."
  -- Thomas Paine

____________________________

• Quis custodiet ipsos custodes? (Who will guard the guards?)
  -- Juvenal

pogo2

Two US gun companies that are public are Sturm Ruger and Smith & Wesson. You can learn something by looking at their financial reports. Here is a link to recent financial information on Smith & Wesson Holdings, which is traded on the NASDAQ:

S&W recent financial data

In looking at this, it appears that the gross margins run about 35% in recent quarters, so the cost of goods sold run about 65%. The cost of goods sold in a manufacturing company are typically direct manufacturing costs, which are mfg. labor, materials, mfg. overhead, etc. So this would be the cost of a product before G&A, marketing, R&D, interest expense, taxes and profit. So I'd estimate that in Smith & Wesson's case, the direct manufacturing cost of a gun is about 65% of the selling price to the dealer. If the dealer margin is 20% (just a guess), it would look like this for a $500 gun:

Price paid by customer.....$500
Price paid by dealer..........$400
S&W mfg. cost................$260

How's that for a WAG?

__________________
Firearms are second only to the Constitution in importance; they are the Peoples' Liberty's Teeth." - George Washington

QKShooter

The number that sticks in my mind is that it takes 16 hours to precision machine one Glock slide and get it to completion.
The cast polymer frames are produced very quickly.

__________________

Support Our Military.

~~~~~~~~~~~~~~~~~~~~~~~~