Quote Originally Posted by StevieJ View Post
Point taken, but I also feel like it's almost a waste of time to start a small/tiny gun store nowadays and only have 5k in inventory. Like I said, I was looking for a few items, none of which they had, and the salesmen offered to order them for me every time. With online monsters out there now like CDNN or Palmetto State, I just think it's a waste of time and resources to try to compete when you're just going to close the doors in a few months and put people out of work.
Inventory is a double edge sword. Too much and the costs consume the business (figure the inventory costs at 40% of inventory annually, so a $100,000 inventory will cost $40,000 a year to keep on hand) and too little and the shop can't produce the gross profits to cover expenses. The smaller shops that appear to do well seem to have found a balance between these two inventory issues. Of course there is more to it (such as having the higher gross margin items in stock) but StevieJ is correct. A $5,000 inventory for a retail shop is likely certain death unless there are some very unusual sales metrics.