The Gun Industry

[tilden]

As a new member, forgive me if this is in the wrong section.

Recently I started back to school to finish my degree. It will be in Marketing, and if all goes well, I should be done by June 08, 31 years after I started (can't rush these things).
I have a paper to write that is to be on a business that I'm not familiar with now, but would like to be in the future.
I'd like to write the paper on the gun industry. But that is to wide, and I need to narrow it down to a part of the industry that is growing, or, a new off shoot of the gun industry.
So, I thought why not ask a group of people who know a lot about guns.
In your opinion, what do you see as a growing, or new segment of the gun industry that is taking off or will take off in the not to distant future?
Thanks for you help.
Regards,
Tilden

 

[strat81]

The big thing now, and for the next decade, is black rifles (tactical rifles as S&W call them). Gen X, Gen Y, and Millenials have grown up seeing them on TV and in the movies and are now VERY mainstream. Even so-called traditional companies like Remington and Smith & Wesson sell them now. There are major manufacturers as well as boutique shops making them with prices starting in the $600 range for an Olympic Plinker. The sky is the limit in price and aftermarket accessories abound for them. Traditonally chambered for 5.56 NATO, their modular design has allowed tons of calibers to be shot from them, allowing them to excel in areas such as plinking, target shooting, practical/combat matches, home defense, law enforcement, hunting, and, of course, military combat. The basic design is simple enough that someone with basic skills and an instruction manual can assemble one from parts.

 

[Bobarino]

the upcoming Heller decision could have a huge impact on the gun industry, regardless of which way it goes. if it comes out in our favor, new markets may open up and if other types of weapons are "legalized" again, ie: new registration of full auto weapons, you'll probably see a new market segment emerge from that as well as ammo shortages or maybe even new ammo manufacturers popping up.

the baby boomer generation is closing in on their twilight years. their greater appreciation for tradition, fine wood stocks, and old school steel guns isn't as present in younger generations. you can see the fundamental shift on current manufacturers already. while many still cling to yet another iteration of the 1911 for sales, most all are introducing and/or improving their polymer wonderpistols that younger generations seem to like more. witness the demise of Winchester. they kept pumping out the same guns for a hundred years and didn't change. they went by the wayside, for the most part.

hopefully, idiotic legislation like the microstamping that passed in CA won't sweep the nation but if it does, gun makers will have to deal with the added complexity of manufacture and costs and of course, pass those costs on the consumers. that could cause a huge drop in gun sales.

if the presidency and congress go Democrat, there will likely be more attempted and possibly successful gun bans of some sort which, again, will affect the industry.

if say, Ron Paul is elected, fat chance of any further bans and good chance of getting old restriction thrown away, a plus for industry.

there's tons of factors to consider. its not a stagnant industry, or least it shouldn't be if the manufacturers want to survive.

Bobby

 

[Big45]

I think the carry market is set to explode with most states now issuing to its residents. The mini 1911 seems to be all the rage now in that market.

 

[Regolith]

their greater appreciation for tradition, fine wood stocks, and old school steel guns isn't as present in younger generations.

Speak for yourself.

Although, I do like black rifles as well.

 

[Guntalk]

Strat81 nailed it right out of the box.

The phenomenal growth of the "black rifle" segment of the market -- primarily rifles based on the AR-15 platform -- is a fascinating story in marketing and unintended consequences. The so-called "assault weapons" ban of 1994 is, in part, responsible for this rapid growth.

This "ban" actually didn't ban the guns. It banned guns which had a few cosmetic features. The only way the Democratic Congress could get it passed was to offer it with a "sunset" provision, which provided for the law to evaporate in 10 years. Remember that the Democrats had been in control of Congress for 40 years, and they could not imagine that in 2004, they would not be there, so . . . thinking that they would just renew the ban, they passed it with the sunset provision.

There are two instances of unintended consequences here. The very act of passing the ban was responsible (according to President Bill Clinton) for the Democrats losing control of Congress in the 1994 elections. Therefore, they were not in control in 2004, so the attempt to renew the ban failed, and the law went away.

The second unintended consequence was that prior to the ban, and all the publicity given to it and these semi-automatic rifles, only a small percentage of shooters and hunters paid any attention to them. All the hubbub about "assault weapons" (and they are not, I would add), created an intense interest in them.

Today, the AR-15 outselsl any other model of rifle in the United States, and there are probably 20 or more companies making them.

AH! A third unintended consequence. When the Democrats attempt to pass another "assault weapons" ban, there will be hundreds of thousands, or maybe millions, more people who own, shoot, collect, hunt with, and love these rifles, than when they passed the first ban which cost so many of them their jobs.

If you decide to write your paper on this, feel free to contact me about it. Talking and writing about this and other firearms subjects is what I do for a living. I also give talks for the National Shooting Sports Foundation (the firearms industry trade association) on the AR-15, and basically what I just wrote above.

 

[Henry Bowman]

If you need industry stats, I recommend the National Shooting Sports Foundation http://www.nssf.org who compiles such information for the industry.

 

[gbran]

Guntalk

There was a 4th unintended consequence. This, due to the 10 round mag cap ban; Gun mfg'rs stuck with less than 10, realized they could make smaller more compact handguns. This brought us the CCW sized pocket rockets. They made a plethora of 10 round compacts that we might never of had, not for the 10 round cap ban.

 

[Trebor]

I agree with Strat81. The part of the industry that seems to be growing is the "tactical" and "self defense" segment. This is reflected by the sales of AR-15 and other similar rifles with a "military" appearance.

The increase in "shall issue" concealed carry laws across the U.S. has also led to more interest in concealable self-defense handguns.

The part of the industry that is shrinking is the traditional hunting market. This is due to the overall decline in hunters across the nation.

If you need to limit your research to one segment of the industry I specifically recommend you study the number of manufacturers who now make AR-15 rifles. Heck, even Smith & Wesson now makes an AR-15 for police and civilian sales.

 

[atek3]

if you're lucky, try finding someone to speak to at Cerberus Capital. They are a private equity fund that bought Remington, Bushmaster, and Cobb... Private Equity firms typically buy companies that they think will grow in the future. They could probably explain their logic better than I can.

From what I've read, the hunting/target side of the market is basically stagnant to declining. The "tactical", "LEO", "military", "self defense" side of the market is booming.

 

[strat81]

They made a plethora of 10 round compacts that we might never of had, not for the 10 round cap ban.

Another unintended consequence: people switching to larger calibers because of mag bans. The primary reason I have 9mm pistols for the nightstand and for carry is because of capacity. If I was forced to use 10 or less, I'd almost definitely step up to .357 Sig, .40S&W, or .45ACP. This might be less of an issue for carry guns that might already be under 10 rounds, but if a full-size pistol like a Sig 226 or Glock 17 is limited to 10 rounds, it seems silly to keep them around instead of switching to a bigger caliber.

 

[tilden]

I'd like to thank all of you for your great information.

 

[tilden]

kla-kuk