ammo pricing question

Discussion in 'General Gun Discussions' started by John G C 1, Jul 31, 2020.

  1. Prince Yamato

    Prince Yamato Member

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    Having worked for an FFL before and during a panic, I can tell you that distributors don’t change their costs drastically. Not enough to justify extreme high costs some dealers are charging.

    For everyone who’s new to guns, this same thread pops up every panic. Raw materials are still coming in. Factories are still running. Workers can easily work overtime. It’s the same (poop), different animal.

    FFLs are like car salesman. Their job is to sell you on a good. Just like car salesmen, some are good and some are bad. I shop around. I don’t mind paying a little more if I like the place, but I don’t like anybody so much, that I’d pay a 200% markup.
     
  2. Old Dog

    Old Dog Member

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    We're talking about the ammunition supply, not the actual firearms supply. And there was a period where the raw materials weren't coming in, either at all or at greatly reduced quantities, and depending on the state in which the factory was located, no, some were shut down and/or operating at reduced capacity.

    Lack of firearms in the supply chain isn't quite the same as the perceived lack of ammo in the supply chain.

    This is not the "same poop, different animal." But at least we can hope that the current situation isn't the new normal.
     
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  3. imac98374

    imac98374 Member

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    I guess the question is would you rather see empty shelves with marked at pre-Covid pricing or ammunition in stock priced at what the market will bear. It stings, but I’d rather see the latter.

    And I’d rather see the gun stores make the profit than the folks who show up to buy out inventory from those selling at prepanic prices and then sell on armslist/texasguntrader/insert other site and sell at just above what the retail store should have been pricing at.
     
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  4. George P

    George P Member

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    The great .22lr shortage was just because of that - Walmart did not raise their prices and as a result, some folks always cleaned them out and then resold at a large markup at flea markets. Had Walmart raised their prices, those folks would not have bothered and things would have calmed down a lot sooner.
     
  5. CapnMac

    CapnMac Member

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    Not how it works.
    Factory makes ammo.
    Distributor buys the ammo in bulk.
    Wholesaler (or buyer for large store chain) purchases from Wholesaler
    Retailer (and internet/mail order reseller) buys from wholesaler.

    Price on the shelf is entirely up to Retailer, who has a lot of "sunk" costs built into each product for sale (keeping the lights on, paying the rent, making payroll, etc.).

    If only one person per quarter comes in and buys the cal..11 hyperjimmyjangle ammo, that low demand will not support a high retail price, even if the box sits there eating shelfspace for 90 days. So, it might be marked down to cost; or sold as a loss leader (buying the shelf space for something that actually sells).

    Now, ten people a day come in wanting .66magnum skuulbusblaster, that might only cots $5 the box at the factory, but to keep any on the retail shelves might need a retail price of $55 the box. Of 20.
    And the wholesaler is probably raised their prices to, what with everyone they sell to demanding more.
    The distributor may have raised prices, what with all the drop shipping to the wholesalers. Or might not, they generally have to wait for the shipping container to clear Customs, just like any other time.
    The factory still only gets their $5.

    Retailers get pilloried for raising their prices, slandered as gougers and opportunists. But, when people want their .66mag, and you don't have it, they will go to a store that does. And they remember that you don't--so what else don't you have?
     
  6. mjsdwash

    mjsdwash Member

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    its not about capitalism, its not about free markets. Those things only work in free markets. Politically manipulated and government controlled, especially the very heavily regulated, multiple license effected consumer goods do not qualify as free market/capitalist products.
    Whats happening, demand exceeds supply, suppliers know that using capitalist supply/demand principals hurt them in the long run, so most are not raising prices because of that. Too many "they will never see another cent from me" themes.

    Whats happening is that retailers have to set a price that will pay their bills when resupply stops. Manufacturers can't, and won't try to meed demand. Once a retailer's shelf's are empty, they can't fill them. They have the choice to sell cheap and go under, or sell high enough to keep open.

    2016 changed the rules for how to deal with this. Manufacturers ran overtime, reputable sellers kept prices good, people kept shooting, but once Trump took office, it all fell out. Lots of shops closed. Lots of ammo/arms makers did layoffs, some filed bankruptcy. X-treme, Freedom Munitions, Remington come to mind.
     
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  7. Bill Raby

    Bill Raby Member

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    Bob is selling ammo at normal price. John is selling ammo at double price. Bob is a wonderful person and you love him. John is a jerk and probably kicks puppies. Bob has not had any ammo to sell in weeks. John has all the ammo you want. Who are you going to buy ammo from?
     
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  8. Mr. Zorg

    Mr. Zorg Member

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    That was exactly my point - that brand of that cartridge pricing didn't change when restocked. If you accept that point now, it's interesting what can change in such a short time frame. If everyone depended on Ammoseek there wouldn't be any justification for any retail shelf space devoted to B&M ammunition FWIW. Some of us lived, collected, and shot firearms before the Internet came along, both before and after we were legally eligible to vote, and the fact the shelves have been depleted of what's considered hunting ammunition outside of traditional medium and big game hunting seasons says something in and of itself. I don't remember that being the case in any prior rush periods on ammunition nor any other period during my lifetime and my memory is still highly functional.
     
    Last edited: Aug 2, 2020
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  9. DoubleMag

    DoubleMag Member

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    It's beyond industry wide. I cannot get a very regular part for my early 90s truck. Reason, covid. Remember when YOUR job scaled back, closed? Well Surprise ALL big vehicle manufacturers CLOSED. I guess it's no surprise that the factories supplying parts to the big auto makers...closed....
    My printer died. No problem, waltz on down to the big box and...whatttt? NONE. Well, an undesirable brand that I don't like and others don't either. Called, called, generic internet search, NOTHING. By accident my local WM*** had ONE, and it wasn't even on the website. Girl (at Phone counter) said,things really haven't slowed since last Blk Friday, then XMas...ppl getting IRS checks (where they sooooo cleverly ALLOW gov an INTEREST FREE loan all year, and ''think'' they're extra fiscal smart w/ a big check in spring:neener: DOUH!), and then the Covid thingie panik shopping TP, meat, cleaners, which is JUST NOW starting to ease....

    But it's somehow magically :pdifferent for bullets. Those same economic forces caused NO AUTO PART at ANY PRICE; printers on Amazon for DOUBLE or MORE; but doesn't apply to bullets? And yes there is a political component, but, double prices? No ammo available? really?
    Ppl were having to work from home voila! home office = printer shortage; yest same ppl say ''I need a new pistol'' and 2 boxes ammo (X) record sales does NOT equate to a bullet shortage and higher prices (e.g. Amazon printers)?


    REALLY??

    p.s. // there's the CAPTHCA are you a human? thingie again, I M LOGGED IN:cuss::evil::mad:;)
     
    Last edited: Aug 2, 2020
  10. Megawatt maker

    Megawatt maker Member

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    Think it's bad now, buckle up and hang on tight, it's going to be a turbulent ride!

    Prices are not coming down anytime soon this time...if they even ever do. I know we try to shy away from politics here, and I understand why, but this very issue in this thread...its political and nothing but. Wrong guy wins in Novermber...you'll see these present days as the good old days before long. Not only will there be the normal supply and demand issue (see Covid), but add in lots of new gun control scams...and worse...AMMO control scams...

    You'll be wishing for the present prices....if you can get anything at all.

    We are in dark days.
    It doesnt matter who is raising prices..manufacturer, wholesaler, distributor, retailer...its the MARKET dictating the prices..and its DEMAND that is doing it.

    And it WILL get worse.
     
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  11. lsudave

    lsudave Member

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    Things are just hairy out there. Congrats to the poster who got some S&B at a good price; it's my preferred ammo, and I haven't seen any available whenever I look. My purchasing has been online.

    Supply chain is very stretched out; I ordered some 9mm range loads from a reload seller. I don't know how big they are, but they were decently reputable, so it wasn't a tiny place- they had listed bulk order in the 2, 3, 5k quantities, in several pistol and rifle calibers. I ordered in May, it's finally shipping. They have been in touch and told me their access to components was the biggest delay, although they did have a ton of orders. Now, they have finally completed my order, and they kept the price low ($180 shipped), so it's a good sign- they are catching up, and they could afford to sell at that price. They won't take additional orders now, as compared to some who do and string it out months. The prices remain the same, so it seems a matter of "we'll sell it at this price, when we can make it".

    Somebody mentioned the secondary market... that's not a great indicator. I could probably make a killing with what I do have right now, that doesn't mean the market is good for buyers. I want to be an end-user, not a retailer.
     
  12. FFGColorado

    FFGColorado Member

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    The other thing is, it's all about the monthly 'nut'...that is, the ability to pay your fixed expenses. So, you take what something 'costs' you and divide by about .65 or .6 to get the preferred 'margin' you need to keep the lights on and accrue no more long term debt..plus really make no profit at the end of the year. For bicycles(owned a store for a long time), it was divide cost by .65..that was the MINIMUM to break even. So...LGS, USA, can't get product, or slim amount..to say afloat, they have to either increase margin or volume. We know the 'volume' answer. And as eluded above, it's a distribution problem...LGS inventory is based on a certain 'sell thru'..which triggers re-ordering via a distributor/manufacturer. That has been disrupted with a capital 'D'..

    I goyta wonder why some are filling 60, 70, 80 ammo cans with ammo..for when the covid-zombies come over the fence? Cuz gotta get it now cuz won't be able to in the future? Shoot lots? I donno..I have a pretty fair amount, and I am not shooting(outdoor shooting area closed for fire danger)...
     
    Last edited: Aug 4, 2020
  13. Steve S.

    Steve S. Member

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    I think that the present ammo situation is a bit of all causes noted here; all of those causes have a cumulative effect of what we now see as ammo pricing and availability.
    Shooters will adapt as they will with less consumption and equilibrium will occur; the big question is at what level of pricing and supply will the market trend after that equilibrium.
     
  14. Prince Yamato

    Prince Yamato Member

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    Half our ammo comes from overseas. Taiwan was not shut down at all. Belarus, Ukraine, and Russia were not. Sweden was not...

    I think the distributors failed to plan again.

    They said the same thing in 2012/13. Prices will come back down. Logically, at some point, people will be stocked up. Unless you shoot machineguns weekly, at some point, you will have a comfortable enough stock of ammo.
     
  15. John G C 1

    John G C 1 Member

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    One place is currently (8/2) selling a case of 9mm for 1,000.....plus shipping. Be interesting to see if they get it. BTW, that is for American Eagle 115.
     
    Last edited: Aug 2, 2020
  16. Mars5l

    Mars5l Member

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    Was picking up a new gun today and was asking about their 9mm ammo. Last week it was $22 a box for most brass cased FMJ. This week they are $28 now. This is a fairly large gun store as well. I told the employee I'll pass for now. He mentioned they are paying $37 a box from their distributor. So they are selling them at a loss. I have no reason to doubt him but who knows
     
  17. John G C 1

    John G C 1 Member

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    Holy cow. My LGS says they can't get anything, period. Local Dunhams is literally wiped clean.
     
  18. Ignition Override

    Ignition Override Member

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    Archer- I “would have thought“ that the seller with the momentary, Huge discount might be Cheaper Than Dirt.

    Their “allegedly” fraudulent behavior during a previous panic prompted them to sell some Greek HXP .303 ‘Brit’. at a discount as they tried to bring customers back to their shoddy operation.
     
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  19. CGilbert74

    CGilbert74 Member

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    This is my 4th or 5th or so pricing “panic” now and I’ve learned the hard way - slow and steady wins the race. Buy whatever you can afford when no one is paying attention, and there are no national headlines. That way when these episodes happen - and they will continue to happen - you have what you need. Same thing goes for firearms - know what you want and keep an eye out. It’s a boring strategy - but right now we have what we need. Several members have explained what’s going on right now with great clarity. Good luck to all!
     
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  20. Old Dog

    Old Dog Member

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    Don't know where you get your information from. We do import ammunition from Italy, Spain, Serbia, Russia, Peru, Israel, etc., but hardly half of our ammo is imported. And surely you followed what was going on in our ports during the initial couple months of the pandemic? And the overseas mines? If you're trying to pin the ammo shortage on the distributors, you may be barking up the wrong tree.
     
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  21. daniel craig

    daniel craig Member

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    Just bought some Remington FMJ 9mm (the green and white box) for just over $10 a box. That’s not a far cry from it’s usual going rate.
     
  22. DoubleMag

    DoubleMag Member

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  23. ojibweindian

    ojibweindian Member

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  24. benEzra

    benEzra Moderator Emeritus

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    Demand might not have changed. Supply has, or soon will.

    The reason? Manufacturers likely don’t have an entire production line dedicated to less-common calibers like 7mm-08; they run batches on the lines that also produce .308/7.62x51mm, 6.5mm Creedmoor, etc.

    If the latter is backordered six months out and people are willing to pay double the pre-crunch price to get it, they are going to cut back on running 7mm-08 batches to catch up on .308. The existing 7mm-08 in the supply chain will prevent shortages while supplies are drawn down, but once it is gone, new 7mm-08 will have to compete with.308 for production line time, and will be priced accordingly.

    This.

    I’d rather see goods on the shelf at twice their pre-production price (incentivizing and paying for factory triple shifts/overtime, new production lines, AND damping demand by discouraging speculators). Rather than seeing empty shelves marked at pre-surge pricing. It is one or the other; you *cannot* have both.
     
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  25. Telum Pisces

    Telum Pisces Member

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    Prices have to rise to cause human reaction to not buy as much to keep supply available. If prices remained the same, there would never be any available. Academy is one example that does not raise prices for the most part. But good luck finding anything in that store unless you are taking it from the store shelf stockers!
     
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