Here at TTAG, we get lots of questions from our readers about a variety of gun-related and regulatory topics. One of the those that we’ve been meaning to cover over the years is so-called kitchen table FFLs. These non-conventional federal firearms licenses have advantages and disadvantages, both aspiring firearm industry professionals and consumers alike.
My general opinion of kitchen table FFLs is that it’s a bad idea, and here’s why. The first thing that usually comes to mind for some gun people is that they like guns, so why not make it a business? Get your FFL, make some money, use said money to buy more guns. Easy, right?
Not so much. Let’s start with the basics. I’ve been in this industry for a shade over thirteen years and I’ve seen this happen time and time again.
Unfortunately for some, the best of intentions can get tangled by the worst of city hall red tape and regulatory difficulties. What you need to be a federal firearms licensee is 100% compliance with the Gun Control Act of 1968, the National Firearms Act of 1934, state level regulations, local level regulations…all while you run a business.
What this means is you’ve got to be on the same page as the zoning office at city hall, maintain the ability to run background checks and determine who is eligible and not eligible to purchase or transfer firearms through you, link up with NICS or your state-level point of contact and run background checks.
You’ll have to maintain all your records to ATF standards – including warehousing 4473 forms for two decades and be able to process form 4’s – which means sitting on stuff (think: suppressors) that belongs to other people until their stamp clears months (or sometimes years) down the road.
Here’s what the ATF says you’ll have to do when you apply:
The application must be accompanied by the proper application fee ($200), which you can pay by check, credit card or money order (we do not accept cash). Once the application fee is processed, the FFLC will enter your application information into its database and commence a full review of your application. For all license types, except type 03, required supporting materials, including fingerprint card(s) and photograph(s) will also be reviewed. As required by law, the FFLC will then conduct an electronic background check on all the Responsible Persons you have identified on your application. ATF defines a Responsible Person (RP) as a sole proprietor, partner, or anyone having the power to direct the management, policies, and practices of the business or activity as it pertains to firearms.
Piece of cake, right?
Most people don’t really want to run a business, so that’s the first thing the ATF typically asks. And that’s the largest sticking point that potential kitchen table licensees struggle with. The ATF wants to see you running an actual business, and if your local zoning doesn’t allow you to do that out of your house – you’re out of luck before you even start.
I’m not saying that all kitchen table FFLs are like this – some of them are very good, some not so much. I know a number of folks who started a firearm business from their kitchen table or out of their garage and have gone on to be good purveyors. I’ve seen some who were not so successful.
Some readers will stand up and shout, “Of course Hank is going to say having a kitchen table FFL is a bad idea. He doesn’t want the competition!” But the competitive aspect of things is secondary to the reality.
The biggest thing that I see in this industry, particularly among the kitchen table licensees, is that a lot of them don’t have the time, technical expertise or desire to be compliant with all of the rules and regulations. Not to mention that details like keeping tabs on the UPS guy, the FedEx truck, the other FedEx truck, the USPS letter carrier and ever-changing ATF regulations is pretty much a full-time job.
For most kitchen table licensees, there isn’t always someone available to sign for and receive packages until after close of business. They have regular jobs and aren’t home all day. That means items get put back on the truck to sent out again the next day – usually re-delivered at about the same time with the same result.
On the topic of technical expertise, one of the F class shooters at my gun club has been talking about getting his own FFL at his house for the past ten years. His reasoning is simple. He’s been building F class guns for 35 years and now he wants to do it for money. But he doesn’t want the expense of running a business burdening him like a millstone around his neck.
Locally we had one fellow who had decided that expensive silencers were a waste of money and decided that he had better technical knowledge and engineering expertise than Todd Magee at Dead Air and Mike Smith at AAC/Remington. This from all his years as a skid steer operator. If anyone is wondering, most of his groundbreaking designs came right out of The Anarchist Cookbook.
The ATF eventually pulled his license after they found out that he wasn’t running background checks on any of the items that he had sold. He was a terrific guy to call if you need some land clearing done, but an awful choice if you want someone who’s going to be around and smart enough to follow the law on that silencer tax stamp application and transfer.
The biggest complaint that I hear from customers when transacting with kitchen table FFLs, though, is the lack of time and regular hours they’re available. Simply put, someone who’s working gun shows on the weekends may not be able to call a vendor and order a gun for you on Monday and be able to sign for it when it arrives at noon on Tuesday. They’re probably going to get out of work, grab it at the FedEx terminal after the truck gets back at 8 PM and hopefully call to let you know your item is ready. If you’re lucky. In our instant gratification society, this is less of a selling point all the time.
One of my customers, Jeff, had a fairly horrific story to share about a kitchen table FFL he dealt with. He lives in a rural part of a northeastern state where there aren’t many dealers nearby. He had just bought a highly collectible firearm that required a tax stamp from a dealer out of state.
Exotic devices have exotic problems. As far as taking delivery, Jeff had two practical choices. The first was to get his own C&R license from ATF and take delivery directly once he got the paperwork worked out with the licensing division and then ATF’s NFA branch.
The second was to find a licensee near him that would be able to handle a transfer for him. Having no desire to become a collector and wanting to limit his ATF contact as much as possible, he chose to just pay someone to do the transfer.
I tried to help him find someone near him who would do the transfer, but in his area there were no licensees who could handle it. I called everyone I knew and nobody had a good answer for me. Eventually he found a kitchen table FFL that was three-and-a-half hours away who was willing to help him get him his gun. Jeff telephoned him and the FFL was more than happy to handle the transfer. Things then went downhill in a hurry.
Jeff took the lead with the selling party and got the out-of-state dealer all the paperwork they needed and got the transfer rolling. His gun shipped out and got to his not-so-local kitchen table FFL. Jeff took the lead because the dealer on his side didn’t seem very interested in doing the work. That was bad sign number one.
Bad sign number two was that he hadn’t gotten his Form 4’s from his dealer. He kept calling the dealer asking for his forms. The dealer kept asking for the same info repeatedly – the name of his trust, his contact info, etc. – and after the third or fourth time Jeff was fed up.
He decided to fill out the forms himself and send them to the FFL for him to sign and then get them shipped to ATF’s NFA branch for approval. The next thing Jeff knew, his phone calls to the FFL weren’t being returned and his emails weren’t getting any replies.
Jeff was wondering if this guy was still alive. After spending a restless Friday night unable to sleep, he realized that taking matters into his own hands was his only option. He decided to embark on an early morning drive to see the FFL who was holding his machine gun, three-and-a half-hours away.
I was browsing Facebook and saw him post a small blurb about his quest while I was in Las Vegas for SHOT Show. As it was just past midnight Vegas time and just past 3 AM east coast time and Jeff had just hit the road. I was worried for both Jeff’s sanity and safety.
I called him and asked if his wife approved of this insanity. The notion of driving through the middle of the night, through northeastern snow and ice, with the goal of arriving at a total stranger’s quonset hut, pre-dawn, and banging on the door is something worthy of a Darwin Award nomination.
Jeff wasn’t happy. He had spent a significant amount of money on this gun that was being held by the FFL who wasn’t responding to him. He wasn’t able to sleep and decided to get some resolution to this issue in person. I suggested that he call local law enforcement before knocking on a stranger’s door.
Arriving at his destination before daybreak, he sat at the edge of the driveway and called the local law enforcement officials who STRONGLY suggested that he wait until the sun came up before banging on the door. Being a pretty reasonable guy, he spent the time between arrival and sunrise sitting in his car drinking convenience store coffee and revising his last will and testament in case this went terribly wrong.
What happened next is something straight out of a Hollywood writers room.
He knocked on the door and the fellow who answered responded as if it wasn’t anything unusual to have someone show up uninvited at 7 AM to ask about paperwork for their machine gun. The licensee invited Jeff in, offered him a cup of coffee and acted like nothing was a problem. As Jeff walked in, he noticed papers taped to the kitchen cabinet doors in his house which he described as a shotgun shack.
Every single one of these documents was a different federal license. The kitchen table dealer had made it his mission in life to acquire just about every license the ATF offered. Including explosive licenses. The only problem was that while the man had all of those licenses, he had no idea what to do with them. Jeff was his first transfer and the FFL had no idea how the process worked.
The dealer riffled through his paperwork and eventually found the form 3. They completed the form 4 for Jeff’s gun, the transferring dealer signed it and Jeff was happy that his forms were finally ready to roll to ATF and got ready to head home. Knowing that the man holding onto his gun was clueless, Jeff asked him if he knew what to do when the ATF eventually approved the paperwork.
The answer, of course, was no.
There is no IQ or proficiency test to be a FFL, but after hearing this story, maybe there should be. I am in no way proposing more government regulation, but there has got to be a better way. The ATF issued that kitchen table dealer every license that he had asked for and paid for without any guidance or demonstration of competence.
Jeff educated the dealer as to who would be getting the final paperwork and has been regularly checking in with ATF ever since to see if any of his documents require corrective action. This, because he’s acutely aware that the dealer holding his (very expensive) property will likely not know what to do with it, how to correct it, will probably ignore it. And won’t call or email Jeff about it if there’s a hitch.
To be clear, not all kitchen table FFL’s are so inexperienced or uninformed. There are certainly good ones out there. The problem is, from a customer’s perspective, how do you know? Most brick-and-mortar FFLs have established reputations that can be researched to determine whether or not you want to do business with them. That’s not as easy with someone operating out of his home.
If you are an aspiring kitchen table merchant of death and you’d like to jump into this business head first, by all means, go ahead. It’s a free country. I just hope you’ve done the due diligence to know what’s involved, both for your sake and that of your customers.
If you’re a consumer who wants to know what the potential downsides are to doing business with a kitchen table FFL, you’ve just heard one of the strangest situations that I’ve ever seen. But you could very well have a perfectly fine experience and find someone you like doing business with and live happily ever after.
I have adapted an old quote from Dr. Ian Malcolm that a lot of kitchen table dealers seem to have never heard or have long since forgotten. Kitchen table dealers are so preoccupied with whether or not they could become a licensee, they didn’t stop to think if they should.
Your mileage will undoubtedly vary.