Gun Store Break-Even Analysis: About $28K Monthly Sales

Fixed costs $23.8K/mo Monthly overhead

Contribution margin 84.5% After variable costs

Break-even revenue $28.1K/mo Revenue target

Break-even timing Month 19 Forecast break-even

Break-even calculator

Test monthly revenue against variable costs and the fixed cost base for a gun store.

Lean Base Full

Monthly revenue Revenue sets the cash left after variable costs. $ Low sales High sales Variable expenses These costs move with each sale and should stay tied to volume. $ Low cost High cost

Money available to cover fixed costs $29,575 $35,000 revenue - $5,425 variable expenses

Margin ratio

84%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly base the business must cover before profit. $ Tight base Heavy base

Break-even chart Revenue Total costs

Which expenses are fixed and which move with sales in a firearms retail shop?

Cost classification

Break-even is only useful if overhead stays separate from sales-linked spend. In this model, Month 19 break-even depends on treating rent and base payroll as fixed while merchandise, marketing, and processing fees move with revenue.

Expense	Cost	Break-Even Treatment	Common Mistake
Rent Lease Payment	Fixed	Include $5,000/month in overhead from Month 1 through Month 60.	Tying rent to visitor count or sales volume.
Base staffing payroll	Fixed	Include Year 1 base payroll at about $14.6k/month, based on $175k/year across planned roles.	Burying store labor inside merchandise margin.
Wholesale Firearms Ammo	Variable	Model as 8.0% of revenue in the first year, declining to 7.0% by Year 5.	Treating inventory-linked purchases as fixed overhead.
Wholesale Accessories Training	Variable	Model as 3.0% of revenue in the first year, declining to 2.0% by Year 5.	Ignoring lower-margin items when calculating contribution.
Marketing Advertising	Variable	Model as 3.0% of revenue in the first year, declining to 2.0% by Year 5.	Locking ad spend as fixed when it scales with sales.
Payment Processing Fees	Variable	Model as 1.5% of revenue in the first year, declining to 1.0% by Year 5.	Forgetting card fees in contribution margin.
Insurance Liability Inventory	Fixed	Include $1,500/month in overhead for the planning range.	Moving insurance with each order instead of monthly coverage.
Utilities	Semi-fixed	Use the modeled $800/month base, with a review if operating hours or range usage expand.	Assuming utilities stay flat after capacity changes.

What happens to break-even as the store moves from lean launch to base and full scale?

Scenario table

Here’s the quick math: lean is below break-even, base is near the line, and full-store is comfortably above it. As traffic and conversion rise, contribution outpaces fixed overhead and the cushion improves.

Planning cases only: these figures are assumptions, not guarantees.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch case	$263k	$40k	$238k	84.5%	-$16k	Below break-even; traffic or conversion still needs work.
Base case	$316k	$47k	$268k	85.2%	$1k	At the line; small dips can wipe out the cushion.
Full-store case	$418k	$58k	$318k	86.2%	$42k	Above break-even; stronger volume creates room to absorb shocks.

What breaks the break-even plan for this store?

Stress test

The base plan breaks even at about $281K in monthly revenue, against $238K of fixed overhead and 15.5% variable costs. A 10% revenue miss, higher payroll or rent, or a fee-heavy mix can push the store back into monthly loss.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$281K	$0 gap	There is no cushion, so any miss starts a loss.
Revenue shortfall	Monthly revenue falls 10% to about $253K.	$281K	$28K gap	A 10% traffic or conversion miss turns into about a $24K monthly loss.
Fixed-cost pressure	Fixed overhead rises 10% to about $262K.	$310K	$29K gap	Extra payroll or rent before Month 19 pushes the hurdle higher.
Margin pressure	Variable expenses rise from 15.5% to 17.5%.	$288K	$7K gap	Payment fees above 15% or a firearms-heavy mix cuts margin fast.
Combined pressure	Revenue falls 10%, fixed overhead rises 10%, and variable expenses rise to 17.5%.	$317K	$36K gap	Traffic, fees, and payroll pressure together create a hard-to-close gap.

Can you fund opening and still hit break-even?

Founder checklist

Don’t sign the lease until the opening cash stack, staffing plan, and traffic math all work together. This model needs about $377K of pre-open spend, a 3.25 FTE Year 1 team, and enough cash to absorb a $193K Year 1 EBITDA loss before break-even in Month 19.

1Launch cash$377K

Verify you can fund the $100K build-out, $150K initial inventory, $30K safes and vaults, $12K surveillance, $10K POS hardware, and $75K range equipment before you commit.

2Fixed load$23.8K/mo

Check that the $5K rent fits a fixed-cost stack of about $23.8K a month once Year 1 payroll and overhead are in place.

3Traffic proof370/wk

Confirm the store can draw about 370 visitors a week at launch, because a 4% visitor-to-buyer rate only yields about 64 buyers a month before repeat orders help.

4Margin mix88.5% CM

Test that the product mix holds contribution margin (what’s left after variable costs) after 8% wholesale on firearms and ammo, 3% on accessories and training, plus 3% marketing and 1.5% payment fees.

5Staffing ramp3.25 FTE

Make sure the Year 1 plan of manager, sales associate, 0.5 instructor, 0.25 compliance, and 0.5 admin covers the floor without forcing overtime or extra hires too early.

6Cash cushion$298K

Keep enough cash for the Month 24 low point, since Year 1 EBITDA is -$193K, break-even lands in Month 19, and payback takes 41 months.