Manufacturers staying cautious

[Ernie Bass]

Many things here all in-line to form this cause and effect. How about let's start with 8 months of record gun sales with a vast majority of them going to first time buyers who then also need ammunition's. Then let's look at the virus and what it has done to the complete supply chain and the number of jobs related to the manufacture of ammunition components completely shut down for many reasons. Some because of outbreaks and others because of government mandate. Each one of those instances effects the flow of finished goods. From the many different chemicals needed to make powders and primers to the companies and workers supplying the raw brass to make cases. All those things need to come together. One hiccup and the whole chain is stopped. Also many of these components/products come from over seas!

Next again look at all the new shooters and the demand they have placed on the whole supply chain. Having started working at an outdoor range this year I see daily all these new and first time shooters showing up and having no thought of spending hours just blasting away with their new AR's, AK's and semi-auto pistols. One guy sat and put 6 boxes of 223/5.56 down range in just a couple hours. then asked where he could get more! Another showed up at the 200 yard range with his new AR with a red dot sight. I watched as he put 40 rounds down range and hit paper exactly 5 times and then asked what he was doing wrong. I told him he should go back to the 50! Then there was another new owner AR shooter with another red dot sight. Myself and another shooter watched as this guy fired at a 200 yard target and but 15 rounds into the 4th overhead baffle. Again never hit paper.

Then there is the story from my boss who went to help this aged couple with their new semi-auto pistol. her hands were so weak she needed both hands to squeeze the trigger. Even then the shots were passing over the top of the target.

As a public range that sells range time and ammunition as of yesterday we could not find any 9mm anywhere. The pro shop was already selling 9mm ammo for $27.00 a box with a limit of 1! The manager was considering increasing to $30.00.. Not to price gouge but to try and slow sales. He figures if we cannot get and supply 9mm ammo to our customers that we will then loose 35/40% of our daily business.

The manager at out daily briefing yesterday related he was able to find one supplier for 9mm and they were charging 80 cents per round! And that would be before shipping costs or any mark-up for our resale.

That is one good thing to come out of the shortage. The AR weekend warriors will not be filling up the indoor ranges and the annoying and wanton waste of ammo that they are so well known for.(not speaking of all AR owners).
And it will make people more aware of the value of the dollar, and admiration to the folks that have always believed on one shot one kill.
I have just taken up Black Powder and looking forward to just taking my time and becoming one with the gun. Getting into harmony with the wind, sun and gun.

 

[George P]

I primarily reload so this doesn’t really affect me. But it seems to reason that ammunition companies only profit off the sale of their ammo once. So when they run low from a panic, they are only making money on what they sell. If they can’t keep up with demand, then that’s when scalpers (capitalists) make all their money.

Seeing as how this has become a cycle every 4 years and even more often because of civil unrest, it stands to reason that they would increase profits if they ramped up production at least the start of every 4th year for sure. And the civil unrest isn’t going to get better in the foreseeable future. The left and MSM are really pushing this narrative. Seems like no one has an answer and likely never will.

The problem is being late to the party. Scalpers are prepared. Why can’t ammo companies do the same?

Just how fast do you think makers can produce product? The ideal scenario is for them to run 24/7 and produce enough to keep a steady supply going out of the components coming in; anything else costs them money.. I do imagine so production lines that were producing small quantities of rarer ammo like 45GAP, 32 Win Spl, 41 mag and the like have been switched over to help with 223 and 9mm production.

 

[George P]

That is one good thing to come out of the shortage. The AR weekend warriors will not be filling up the indoor ranges and the annoying and wanton waste of ammo that they are so well known for.(not speaking of all AR owners).
And it will make people more aware of the value of the dollar, and admiration to the folks that have always believed on one shot one kill.
I have just taken up Black Powder and looking forward to just taking my time and becoming one with the gun. Getting into harmony with the wind, sun and gun.

Same goes for shooting bolt action and single shot rifles and revolvers.............ammo seems to last a lot longer

 

[jmorris]

Do your really think all the chaos is going to just come to a complete halt in that short of time.

How long did it take to whip people into the panic in the first place?

The entire model is based on one of two things. New or very short sighted people, neither are a customer base for a business to rely on, unless when can plot a trend over time. These panic/surplus waves are not a very stable market to jump into. To sustain the market you need consumers not hoarders.

If you want to be in the speculation business, you would be better off getting a warehouse and stock it full of everything that’s all over the shelves just like earlier this year, when prices are low, then sell the entire warehouse full of goods during the next panic.

 

[Poper]

This time however we have first a pandemic happening at the same time AND a wide-scale lawlessness problem amplifying the situation.

Coincidence or intentional?
Makes a body wonder, does it not?

 

[kmw1954]

To sustain the market you need consumers not hoarders..

So where do we draw the line between Frugal Shopping and Hoarding?

Is buying 10k primers to save on shipping and Hazmat knowing that they will be used, even if that time frame is 2 years, Frugal Shopping or Hoarding? Same can be said for powder purchases.

Is buying 2 cases of factory ammunition when it's on sale Hoarding or Frugal? How about 5 cases of something like 9mm or 223 when it's as cheap to buy as it is to reload?

 

[reddog81]

So where do we draw the line between Frugal Shopping and Hoarding?

Is buying 10k primers to save on shipping and Hazmat knowing that they will be used, even if that time frame is 2 years, Frugal Shopping or Hoarding? Same can be said for powder purchases.

Is buying 2 cases of factory ammunition when it's on sale Hoarding or Frugal? How about 5 cases of something like 9mm or 223 when it's as cheap to buy as it is to reload?

It's all a blurry line... Buying 10,000 primers when manufacturers and retailers are desperate for revenue and offering sales and rebates is frugal shopping or smart hoarding. This activity has no impact on the current situation and acts as a buffer panic buying because hopefully those people won't be fighting over primers when the demand\price jumps. Going out hunting and then panic buying 10k primers for full retail because you might start reloading is just plain old hoarding. Buying 10k primers for $1,500 because they might disappear tomorrow is dumb hoarding.

 

[.455_Hunter]

Recipe for manufacturing success in a panic environment....

- Run extra shifts (24/7)
- Hire temporary help to stretch the capabilities of the trained staff.
- Lease any equipment that can help with bottlenecks on a month-to-month basis, such a temporary storage, material handling and packaging.

When the rush ends, you can return to normal without being encumbered with new debt.

 

[Jim Watson]

I am reading some reports of lapses in quality.
Tired workers, worn machinery, inspector reassigned to production.

 

[jmorris]

So where do we draw the line between Frugal Shopping and Hoarding?

I think frugal shopping would be buying when things are plentiful and cheap, running to every store to buy everything you can at the last minute might be a sign of the other.

The point was, it’s good to get into the AR business when everyone is paying $2000 for a $600 AR. Bad to have a new business expecting to sell AR’s for prices the market will no longer purchase. Why more than a few doors closed.

Look at primers, for example. People are paying around 5x what they cost at the first of the year. Great time to go into business making them right? Talk about a nightmare of rules and regulations, not to mention equipment, for something that will be plentiful again before you could get it up and running, same goes for rimfire.

If you just purchased and stored, while cheap and plentiful then dumped when at a premium, you get the profit gain without any of the expense on manufacturing. What if you had your 401k in SPP in January, where would you be sitting right now?

Of course, hind sight is 20-20 and I am not a speculator or gambler.

 

[lionking]

hope it all works out better in 2021, COVID, elections and such so things can get normal again.

 

[kmw1954]

I think frugal shopping would be buying when things are plentiful and cheap, running to every store to buy everything you can at the last minute might be a sign of the other.

Of course, hind sight is 20-20 and I am not a speculator or gambler.

Excellent description!

Use to be that I would buy as needed from our local Cabela's because prices were fair and everything I used was always mostly in stock. Saved Shipping and Hazmat fee. The the Buy-out and everything went to hell-in-a-hand basket. I then found another shop that carried what I use only it is 2 hours away. I can make the road trip and actually enjoy it, nice drive, but I had to buy enough to make the trip worth while. I don't mind making that trip once each year. Just then need to estimate what my needs will be.

Though I would be buying larger quantities I would not consider that Hoarding though some might..

 

[jmorris]

Use to be that I would buy as needed from our local Cabela's because prices were fair and everything I used was always mostly in stock.

Absolutely, that would be frugal. I generally buy from powder valley because they will ship 48lbs with one HAZMAT fee but that’s likely “hoarder” amounts of powder and primers to some.

Last time I bought primers from Cabelas they had S&B primers on sale, a sale on orders over $150 and free shipping to the store. Ordered 125,000 primers that day but they were still plentiful after my purchase.

 

[illinoisburt]

Timing and circumstances are always fickle. Literally a year ago gun and ammo distributors were in a terrible glut with rock bottom clearance prices & free shipping ads everywhere. There we important people and pundits on the news saying the economy was so strong people didn't care about politics and wishing for something, anything, to crash the economy. Now here we are a year later with people literally rioting in the streets, forced business closures, and people clamoring for goods in shortage. This is certainly not to entertain crazy conspiracies, rather to remind people that times change. A lot, in fact. Rather than freak out over a box of 9mm it's probably best to let the situation settle itself out and move forward.

 

[Electricmo]

I haven’t noticed lately but are toilet paper supplies back to normal? I bought 2000 rolls and haven’t been back since.

 

[shafter]

Every since about 2008 I've noticed that we have big shortages on a fairly regular basis, usually around an election or a major shooting incident. In between those shortages are times of abundance and fair prices. A wise man knows winter is always coming and prepares accordingly in the summer.

 

[FFGColorado]

hope it all works out better in 2021, COVID, elections and such so things can get normal again.

I'm confident it will. As bad as the pandemic is,the US and globe has gone through much worse, longer term, calamities than this 'relatively short term' crisis. Like Global war...

 

[huntsman]

I am reading some reports of lapses in quality.
Tired workers, worn machinery, inspector reassigned to production.

Since I decided to purchase a new handgun I was concerned about QC issues because we hear that manufacturers are working OT.

Imagine my surprise when I took delivery of new gun and check the date Code only to find this NIB Shield was made in 2017? I’m pleased but a bit perplexed to say the least.

 

[Hartkopf]

Since I decided to purchase a new handgun I was concerned about QC issues because we hear that manufacturers are working OT.

Imagine my surprise when I took delivery of new gun and check the date Code only to find this NIB Shield was made in 2017? I’m pleased but a bit perplexed to say the least.

My theory on this is B rated quality products are held back in a warehouse and not released for sale until volume dries up. They are counting on less returns and complaints from the high percentage of panic buyers that will never shoot the gun. I’m not saying all guns bought in a panic are bad, just that the chances go up IMO.

 

[Tommygunn]

I haven’t noticed lately but are toilet paper supplies back to normal? I bought 2000 rolls and haven’t been back since.

T. P. Supplies are back to normal ..... not so sure you are ...... ......

 

[Archer]

Clearly, there are some parallels between TP in April and 9mm ball ammo right now. The problem is, there’s little chance of Biden outlawing the sale of TP with a stroke of his pen within 100 days in office, but he has explicitly promised to do that with on-line sales of ammo. I sure hope we don’t find ourselves reminiscing on the “good old days of 0.60/round 9 mm ball ammo” like we are now about 0.14/round 9 mm ball.

This is a direct threat to our culture as lawful gun owners and users.

 

[John G C 1]

I wonder why international companies haven't upped their production and sold more than normal to US distributors. Wouldn't it make sense of Geco and S&B and Aguilla to ramp up production of 9mm for a few weeks and sell as much as they could?

Or do you think they did so and that ammo too has just gotten sucked up?

Or is there a finite supply of powder and bullets and casings and so only so much can be made in any month anywhere in the world?

Or is importing larger/newer amounts of ammo too much paperwork to go through to get the stuff here within a few months?

Or do domestic sellers not want to get buyers interested in internationally made ammo and not worrying about shortages?

I do not know. Anyone have any idea? I have no clue about the specifics of the business. I haven't seen any Aguilla 9mm in months.

 

[George P]

I suspect there are export/import limitations in place; those companies are also affected by Covid and may have issues with sick employees; they won't be airfreighting ammo, it comes by slow container ship, then through customs, to jobbers and distributors, and down the retail supply chain

 

[Mars5l]

Is Italy opened up yet? Last I was told Beretta Italy was still shut down

 

[huntsman]

My theory on this is B rated quality products are help back in a warehouse and not released for sale until volume dries up. They are counting on less returns and complaints from the high percentage of panic buyers that will never shoot the gun. I’m not saying all guns bought in a panic are bad, just that the chances go up IMO.

I bought two new Smiths this year from online dealers, the first was in March before this insanity buying really took hold, That gun was made in 2018 so I’m not sure about B quality theory.

I would Expect online dealers to flip their inventory quicker than a LGS but maybe their stock is great enough to cushion demand in certain sku’s that aren’t in high demand.