As we close up shop for the Veteran’s Day weekend, a few more observations that have come in regarding the continuing “evolution” of the outdoor industry’s sales model. First, it’s only appropriate to note that not everything in the outdoor industry is subject to the discussion. There are hundreds of items that go direct from manufacturer to retailer every day, but there are others, including firearms, ammunition and other bigger-ticket items that go through intermediaries.
I say intermediaries because it’s only fair to recognize the fact that there are buying groups out there representing dealers’ interests, too. That’s a point brought to my attention after the latest observations in Thursday’s wire.
That’s reminder that came in loud and clear from one buyer’s group:
“Regarding the conversation about the independent dealer and distribution, you can't overlook the buying group role either. Distribution has its place, but it is truly a middle-man. Our group and our members are still flourishing in 2019!”
Good point. And a second one from a longtime reader who’s also an exec in an apparel manufacturing company. His comment reflects the sentiment it seems many in business share:
“We want to survive where I work, so we ship everything from full pallets of all one style garment via full container loads to big box stores, to a single garment in a single package to a retail customer. Like it or not, today it is get with it or get gone!”
Good points all - and we’re continuing the discussions next week with some notable “thought leaders” from the industry.
One of the industry bellweathers, Sturm, Ruger & Company (NYSE: RGR) reported their third quarter results late yesterday afternoon. As expected, they’re down - like twenty-four percent (24%) for the first three quarters of 2019 compared with 2018.
As has become a longstanding occurrence, however, the company maintained their profitability, returning a dividend of eleven cents per share to investors. It’s not a big return, but it’s certainly better than a notice written in red ink.
Ruger CEO Chris Killoy attributed the Q3 results to continued soft demand - the same that will cause 2019 to be remembered as a slow year for the gun industry. He also made the case that rather than attempt to soften the results via the “aggressive discounting and extension of payment terms” being employed by others, Ruger took the “fiscally prudent measure of reducing production” (for the third consecutive quarter) to moderate inventory levels in the company’s warehouses and in the distribution channel.
Gaming, he noted, works only in the short-term. Ruger, he says “is in it for the long haul.”
Long-term health versus short-term expectations is one of those conundrums that makes me very glad I’m not in the manufacturing side of things. A continued focus on making quarters doesn’t do much toward assuring longevity.
He also noted something important to our discussions this week: one significant impact on Ruger’s numbers has been the loss of a “formerly significant distributor that ultimately filed for bankruptcy protection in June 2019 and the market disruption caused by the liquidation of its inventory of Ruger products.
While buyers are being “cautious” about purchases of new guns, Killoy did report that Ruger’s sales of new products represent $70.6 million - twenty-three percent - of firearms sales in the first nine months of 2019.
We’re entering the Veterans Day weekend, and it’s appropriate that we end our week by offering our thanks to all our friends, neighbors and readers who are service veterans. This is your weekend, and we certainly want to recognize your service on behalf of the rest of us.
Without your service, we wouldn’t be as safe and secure as we are today -and we thank you.
It’s also the weekend when many businesses around the country show their appreciation by offering special prices or incentives to veterans. It’s a long list that changes almost hourly- and there’s really no way we can keep our list current.
Rather than give you incorrect info, we’re going to direct you to the resource listings at themilitarywallet.com. They’ve assembled lists of free meals, discounts and events that isn’t just comprehensive, it’s being updated throughout the weekend.
Here’s how you can see that information:
Veterans Day Free Meals -
https://themilitarywallet.com/veterans-day-free-meals-and-discounts/
Veterans Day Retail Discounts -
https://themilitarywallet.com/veterans-day-retail-discounts/
Veterans Day Events -
https://themilitarywallet.com/veterans-day-events/
Our thanks to themilitarywallet.com for doing that work.
From all of us at The Outdoor Wire, thank you for your service.
—-Jim Shepherd