susieqz
Member
thoughtful threads of this nature are helpful. well reasoned posts are great to read.
How well will gun mfgs. throttle back production to match slumping demand?
- Thread starter Aragon
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wally
Member
Yes, and those that fail to take advantage of the current situation will be the first and loudest to complain about "price gouging" after the next bad event!
My comments are strictly "observational" and I have no data to support them.........At all the recent gun shows that I have attended over the last year and a half, I've seen more NICS checks going on than I ever used to see. Maybe I wasn't paying attention before, but several have interfered with my getting to ask about a gun on the dealer's table, so I think that there are more. And in talking with a friend, a small time gun dealer, who does about 10 shows a year, he tells me that the weather is a big factor in attendance on a "seasonal basis". Bad weather in the summer means heavier traffic at the show, but bad weather in the winter means slower traffic.
I would say that the sales are more based on an opportunity to buy, than they are on a "panic" mode that shows the spikes in sales. I know two of my last three purchases have been made based on that opportunity, rather than my running out to find exactly what I was looking for. I had already decided what I was going to buy.
I should add, this is Minnesota so the weather in winter is a big deal sometime.
I would say that the sales are more based on an opportunity to buy, than they are on a "panic" mode that shows the spikes in sales. I know two of my last three purchases have been made based on that opportunity, rather than my running out to find exactly what I was looking for. I had already decided what I was going to buy.
I should add, this is Minnesota so the weather in winter is a big deal sometime.
Note also that the chart shows manufacturing growth from one year to the next. So in other words, for 8 of the last 10 years of records (through 2013) the records show pretty significant growth from one year to the next. Many of those years the manufacturing growth was in double digit percentages over the prior year. 2010 was essentially flat, showing a decline of less than 2% as compared to a MASSIVE year in 2009 so in other words even with a small decrease there were more firearms manufactured in 2010 than in 2008 for example. The NICS background checks trend pretty closely to the manufacturing numbers, for the most part.
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Sheepdog1968
Member
I think firearms manufacturers are pretty good at forecasting. When we hit flat or downward sales, that is when new firearms are introduced.
I have to wonder if popular TV, especially shows like the Walking Dead, haven't contributed to a surge in gun buying.
Sure, the zombie invasion scenario is fiction.
But the idea that something could happen to cause the world to suddenly be a lot less safe does seem to resonate with people. I'd be surprised if a lot of people aren't watching Rick and Dale and Michonne using M4's and AK's and even a Colt Python to keep themselves alive, then start wondering if they should get a gun of their own... just in case.
Colt may have really dropped the ball on that one.
A commemorative "Rick Grimes" Python might have sold decently, especially if the plans and machinery are still available.
Sure, the zombie invasion scenario is fiction.
But the idea that something could happen to cause the world to suddenly be a lot less safe does seem to resonate with people. I'd be surprised if a lot of people aren't watching Rick and Dale and Michonne using M4's and AK's and even a Colt Python to keep themselves alive, then start wondering if they should get a gun of their own... just in case.
Colt may have really dropped the ball on that one.
A commemorative "Rick Grimes" Python might have sold decently, especially if the plans and machinery are still available.
Ed Ames
Member
Saw this today and thought it might shed light on slumping demand: "Last month (June 2015) the FBI conducted nearly 1.53 million background checks, which are required for all in-store purchases, but not for sales at gun shows or between individuals. That's the highest volume of checks in June since 1999, when the FBI started keeping track."
"May 2015 was also a record month for background checks year-over-year."
-- http://money.cnn.com/2015/07/07/news/gun-sales/
"May 2015 was also a record month for background checks year-over-year."
-- http://money.cnn.com/2015/07/07/news/gun-sales/
Sam1911
Moderator Emeritus
Oh good grief.
wally
Member
Its from the Clinton News Network, while pretending to be unbiased, they slip in an obvious lie (to anyone who cares at all about what the actual law really is) to further their agenda of "universal" background checks -- which we all understand as being to outlaw private sales.
Sam1911
Moderator Emeritus
The funny thing is how trounced he is in the comment section. 99% of the the replies are articulate and spot-on: "you suck at fact-checking or are lying". And that article links to another one where he says exactly the same stuff. Almost like he's deliberately misrepresenting the facts...
wojownik
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"Almost like"? Sam, you're being so high road ... But, either way, it is the author and/or the editors allowing factual errors to slip though, or slipping in such errors .. almost like ... there was an agenda ;^)
justice06rr
Member
Not to answer for the OP, but its pretty clear from seeing low demand and customer traffic/purchases in gun stores and gun shows, and seeing firearms being unsold and stacking up on their shelves are a good indication of slowing demand.
Lately on my trip to the different LGS in my area, it is always very slow in both firearm purchases and range use. Most of the times the stores are empty (of customers) and the guns/accessories/ammo are beginning to stack up.
How do manufacturers plan to handle the slumping demand? We can only speculate. But we could assume that they would slow down production or discontinue products that do not sell or do not provide a profitable margin.
Aragon
member
Demand has dropped and is dropping -- despite the obnoxious and childish attacks of some. At least this time they're not trying to blame dropping prices on reduced product quality as they have in the past.
Yes, it's likely that low profit products will be dropped -- although I suspect many already were when production capacity was at an absolute premium for many gun manufacturers.
What interests me is what will happen if the demand continues to drop? Will manufacturers begin to target one another's market share by sharply dropping their prices in the hopes of attracting their competitors' customers? Limiting production will limit their revenue and could ultimately impact their profitability -- as will reducing the sales prices so it largely become a fascinating operations research problem of maximizing overall profit.
susieqz
Member
i wonder if manufacturers might get smart for a change.
i bet one reason for poor sales is lack of ammo supply.
if someone can't find 22lr, why buy a target gun?
i bet they could work with ammo makers to increase supply which would increase demand for guns to use the ammo.
i bet one reason for poor sales is lack of ammo supply.
if someone can't find 22lr, why buy a target gun?
i bet they could work with ammo makers to increase supply which would increase demand for guns to use the ammo.
The only ammo that is in short supply anymore is .22 LR and even then it is readily available online. Some people just don't want to pay the going rate.
wally
Member
As I've pointed out elsewhere, historically the "bulk pack" .22lr runs about 1/4th the price of the least expensive 9mm FMJ practice ammo per round. The "on-line" sources (speculators) are more like 1/2, Walmart and Academy are selling bulk pack for ~$0.05 per round when they have it, which is about right with the 9mm ball ammo running ~$0.21/round.
When people wise up and stop "paying the going rate" the speculators will be out of business and things will return to a more normal inflation adjusted pricing.
The bad economic news in China looks to be good news for prices of the metals used in ammo, so I'd hold off an any really large purchases for the time being. Lower oil prices will also help eventually with lower transportation costs and energy bills for producers.
I think the on-line speculators, like CDNN (not bad mouthing them, I just won't buy .22lr ammo from them at these prices) are seeing the handwriting on the wall and what used to be "limit 2" is now "limit 10" for the past month or so in their "e-mail specials".
But I certainly have passed up some nice deals on .22lr guns simply because I have a hard time feeding the ones I have and am shooting much more 9mm reloads now.
susieqz
Member
i think some people may hold off on buying a 22, with online bulk going for ten cents/round.
i have no big stores here. i must pay online prices or stop shooting.
i have no big stores here. i must pay online prices or stop shooting.
Ed Ames
Member
I find it amusing that the only gun store in my area to shut down is a local CTD retail shop. Cheaper Than Dirt is, as I'm sure everyone here knows, infamous as the home of the $225 bulk pack of .22lr and the $3500 "optics ready" (meaning no sights) M&P15.
As for low foot traffic and similar claims ("inventory piling up"), that runs so counter to my personal direct observation that I have a hard time accounting for it. I assume that perception comes from comparing 2015 to maybe 2012, which to me is completely invalidated by the odd market conditions over the past 7+ years.
Here are a few examples of what I mean: foot traffic at individual local stores I have visited in the past month or two stores seems pretty much in line with 2005-2007 levels. However, of the 13 or so gun stores (not stores that happen to sell guns ala general sporting goods, Walmart, farm store, pawn shops, etc., but gun stores) I frequent, 7 of them are less than 5 years old. So having the same traffic per store as 2005, but more than twice as many stores, seems not bad for the industry. Same with gun shows, there are more of them.
As for inventory, "piling up" really doesn't match my observations. I can only assume anyone who says inventory today is high has only been buying guns for a few years.
Today, the typical gun store has their entire inventory on display, just to fill the counters. Even then, they are pretty thin. That wasn't always the case.
It wasn't that long ago you could walk into a gun store, handle something like a S&W revolver or CZ75, decide you liked it, and say, "I'll take two." The clerk would put the display gun back in the counter and go into the back (where inventory was kept) to grab two boxed guns. I know this because I did it. Now? What you see is what they got. Pathetic.
As for low foot traffic and similar claims ("inventory piling up"), that runs so counter to my personal direct observation that I have a hard time accounting for it. I assume that perception comes from comparing 2015 to maybe 2012, which to me is completely invalidated by the odd market conditions over the past 7+ years.
Here are a few examples of what I mean: foot traffic at individual local stores I have visited in the past month or two stores seems pretty much in line with 2005-2007 levels. However, of the 13 or so gun stores (not stores that happen to sell guns ala general sporting goods, Walmart, farm store, pawn shops, etc., but gun stores) I frequent, 7 of them are less than 5 years old. So having the same traffic per store as 2005, but more than twice as many stores, seems not bad for the industry. Same with gun shows, there are more of them.
As for inventory, "piling up" really doesn't match my observations. I can only assume anyone who says inventory today is high has only been buying guns for a few years.
Today, the typical gun store has their entire inventory on display, just to fill the counters. Even then, they are pretty thin. That wasn't always the case.
It wasn't that long ago you could walk into a gun store, handle something like a S&W revolver or CZ75, decide you liked it, and say, "I'll take two." The clerk would put the display gun back in the counter and go into the back (where inventory was kept) to grab two boxed guns. I know this because I did it. Now? What you see is what they got. Pathetic.
Aragon
member
Well, to add a data point, here is a handy graphic:
That chart is nearly 2 years out of date too.
Aragon
member
You can reload 9mm for nearly the same price as buying .22LR bulk -- which isn't typically $.05/round these days...
Aragon
member
Let's try this again.
#1: Yes, with every passing year, the cumulative probability of buying a firearm for most people increases as it's the continually summed probability of discrete years -- both past, present and the future of one's life -- no matter how low it might be for each year. But that doesn't mean a helluva lot because the past years are just that -- past.
#2: The more descriptive statistic for this discussion would be the probability of someone buying a gun today or in the future before they no longer can. I would suggest that probability is actually dropping on annual basis for 2 reasons for boomers. First, it's a lot more difficult to buy guns today. In some cases what people want to buy is not available to them. In other cases, people don't want to jump through the hoops.
Second boomers today are by definition between 50 and 70. While there's no doubt that many boomers have substantial disposable income, but a fair number have already bought the guns (or at least most of the guns) that they will own in their lifetimes. So on a year by year basis going forward, the probability of them buying more guns is dropping with respect to the past.
usfan
Member
well, it might not be based on statistics or data, but it seems to me that you can finally find powder, 223 ammo, ar's, & many other things that have been hard to find for the last several years. You can actually find & buy 22lr for under .20 a round!
I also noticed that recently, Beretta made some good deals available, as did glock & fnh. So either production has caught up with demand, or demand has slumped, some.
I think it is a good thing, & will create better prices for the consumers. I ordered a rossi 454 last week, that i haven't seen around for years. So it is the free markets in action. If we let them, it is good for the economy & the consumer.
I also noticed that recently, Beretta made some good deals available, as did glock & fnh. So either production has caught up with demand, or demand has slumped, some.
I think it is a good thing, & will create better prices for the consumers. I ordered a rossi 454 last week, that i haven't seen around for years. So it is the free markets in action. If we let them, it is good for the economy & the consumer.
Aragon
member
Were that the case, I don't think we would be seeing deals from manufactures like Beretta and Glock. That situation would kill the silly AR scalpers but if demand will still at a peak I don't think there would be any deal making from large gun companies.
Ed Ames
Member
You are just looking at it incorrectly. It is the cumulative probably that someone has bought, not "of buying". And it is very relevant to understanding why boomers have more guns today. Why? Because it undercuts one of your premises, which is that " boomers" are intrinsically significant to the gun market.
But any discussion limited to boomers is defined by FAIL.
I agree with lack of availability. Inventories haven't come close to recovering to pre-panic levels and selection is lousy. As for the hoops, that's highly regional. It takes only a few minutes for me to buy a gun.
Who cares? The boomers aren't the growth market. Go walk around in a gun store. A real one, in the real world. See who the customers are. I do this, often. A large majority, 80+%, of the customers are under 50.
THR is overrepresented by retirees as a percentage of active posters because retirees have time to post. You can't base your perceptions of the gun market on this echo chamber. Go, look at the world.
You will love it. I have had one for years and it is one of my all around favorites. Did you find a 20" or 16"?
That's exactly what I've been talking about. Inventories of that sort of gun are still scraping zero. Yes, there are more ARs than the market will pay $1500 for, but there aren't a lot of interesting guns.
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