How to Start a Military Surplus Store Business

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Our guide on starting a military surplus store business covers all the essential information to help you decide if this business is a good match for you. Learn about the day-to-day activities of a military surplus store business owner, the typical target market, growth potential, startup costs, legal considerations, and more!

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Start a military surplus store business by following these 9 steps:

You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your military surplus store business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

STEP 1: Plan your Business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

  • What are the initial costs?
  • Who is your target market?
  • How long it will take you to break even?
  • What will you name your business?

Luckily we have done a lot of this research for you. Skip on ahead to the Business Overview for more detailed answers to all your questions.

Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.

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STEP 2. Form a legal entity

Establishing a legal business entity such as an LLC prevents you from being personally liable if your military surplus store business is sued. Consider using a registered agent service to help protect your privacy and stay compliant.

STEP 3. Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

STEP 4. Open a business bank account

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

STEP 5. Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

STEP 6. Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

STEP 7. Get Business Insurance

Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.

STEP 8. Define your brand.

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

STEP 9. Establish your Web Presence

A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.

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Select your state below for an in-depth guide on completing each of these steps in your home state.

Business Overview

A military surplus store, also known as an Army Navy store, dates back to the mid-1800s. After the Civil War, Francis Bannerman purchased the military’s surplus supplies, adding the products to his already existing business. Store owners have recently begun to alter their business models, with less focus on civilian military enthusiasts and more on consumers looking for affordable gear for their outdoor, survival, and sports activities.

Who is this business right for?

Military, outdoor, and sports enthusiasts who are looking to turn their passion into profit are best suited for this business venture. For long-term success, owners should be knowledgeable and enjoy passing their wisdom on to those in the community.

What happens during a typical day at a military surplus store business?

Your military surplus store’s team will spend each day stocking the shelves, maintaining the facility, and assisting customers in identifying the best product for their needs. You will work with various suppliers, reorder inventory when necessary, and conduct thorough research to ensure fair and competitive prices. Additionally, marketing and administrative duties must be tended to regularly.

What is the target market?

The targeted niche for this type of retail store has evolved over time. While civilian military enthusiasts is still a focus, most now cater to the needs of ex-military, outdoor adventurists, sports fanatics, fishermen, and survivalists. Store owners are urged to find out what the local community’s needs are and where they are lacking when defining their target market.

How does a military surplus store business make money?

Military surplus stores generate revenue from each sale. Many business owners are now offering additional services, such as classes and workshops, to increase annual profits.

What is the growth potential for a military surplus store business?

At one time, Army Navy stores could be found on every other block. When the rules changed and online shopping became popular, only those who could adapt stayed in business. This, coupled with the introduction of sports such as airsoft, has again expanded the need for this type of store. Entrepreneurs with a carefully mapped out business plan that targets specific niche needs have an opportunity to build a successful business. Those who are flexible, able to adapt to evolving needs, will thrive and grow for many years to come.

What are some skills and experiences that will help you build a successful military surplus store business?

Managing any retail establishment requires strong business management and leadership skills. Communication and interpersonal skills will help you develop relationships with suppliers and customers, as well as lead classes/workshops. Attention to detail and a knowledge of the products you offer will, ultimately, define the store’s success. Awareness of emerging trends in sports and outdoor activities and a willingness to learn new things would also prove beneficial. If marketing isn’t your strong suit, consider taking a basic course online or local college, or hiring a professional to manage the business’ advertising strategy.

What are the costs involved in opening a military surplus store business?

When starting from scratch, your first action should be to invest in a location. Work with a reputable organization that can help identify affordable rental and leasing options in the community. Once you have your building, you will need to budget for necessary build outs, fixtures, inventory, sales and inventory software, and a website. Store signage, a logo, and marketing materials should also be included in your initial budget.

Estimated average cost is between $50,000 and $75,000, while the purchase of an existing business could set you back as much as $150,000.

Where can I find a business mentor?

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

What are some insider tips for jump starting a military surplus store business?

Because this is such a niche market, those entering the industry are urged to develop a sound business plan. The Small Business Administration’s website can assist you with everything from planning to managing and growing your new business. While there are a number of online resources for Army Navy store shoppers, new store owners are encouraged to have a fully functional and intuitive website, which will help reach potential customers outside of your geographical area.

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Growing Your Business

How to promote & market a military surplus store business

When choosing your signage, make sure it is easy to see and clearly expresses the types of goods you carry. Distributing flyers to nearby businesses and homeowners is effective, as is involvement in the community. Your local chamber of commerce and police force can assist you in advertising and hosting events such as gun safety and self-defense classes.

Today’s business landscape makes it necessary for all businesses to have an online presence. Online community publications, social media, and paid ads are a great way to attract customers locally and nationally.

Recommended: Get started with local advertising for your business with a $300 credit from Yelp.

How to keep customers coming back

Consistently strong customer service is essential to building a devoted customer base. Let your clients know you value them by starting a rewards system. Interacting with them when they visit and asking for feedback are also effective strategies.

How and when to build a team

Your need for additional team members depends upon the size of the store, how busy it gets, and how much downtime you want for yourself. This is a customer-service oriented job, so when you do bring on new team members, make sure they are friendly and knowledgeable, dedicated to helping fulfill your vision.

Earning Potential

How much can you charge customers?

While prices vary, depending upon the item, its cost to you, and the business’ ongoing expenses, it’s important to remember that customers frequent this type of establishment because prices are lower than other retail stores. If you plan to sell military memorabilia, partner with a knowledgeable appraiser to ensure fair pricing.

What are the ongoing expenses for a military surplus store business?

Aside from rent, utilities, and insurance, you will also need to budget for the following:

  • Payroll expenses
  • Marketing and advertising
  • Website maintenance and hosting
  • Shipping costs for online orders
  • Restocking inventory
  • Travel costs and entry fees for attending auctions

Getting to know your customers and their needs will help identify how much and how often inventory should be restocked, keeping costs under control.

How much profit can a military surplus store business make?

Profits vary depending upon geographical location, community needs, and your ability to fulfill those needs. Since most inventory items you will invest in will be priced at 80-90% of their value, the profit margin is high. Many successful military surplus store owners report an annual profit between $45,000 and $95,000.

How can you make your business more profitable?

As mentioned, most Army Navy stores have gotten creative with the goods and services they offer, based on local needs. Many have found success offering basic and advanced weapons training, concealed weapons certification classes, self-defense workshops, and gun safety training. Before offering weapons training, consider becoming a National Rifle Association-certified instructor and visit the Bureau of Alcohol, Tobacco, Firearms and Explosives website to learn about specific requirements. Does your community have an indoor or outdoor range? If not, building one is an excellent way to generate more profits.

Next Steps

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