Charting A Path Forward In The New Year

By Jade Moldae

There’s some debate on where the idiom “hit the ground running” originated, but there is no doubt it came into more prominent use describing the Allies’ decisive D-Day efforts during World War II. This cleverly coined phrase has since established a foothold in business — everyone reading this knows exactly what it entails. The million-dollar question is, however, what will it take to “hit the ground running” in the new year? With the official launch of the 2019 business year, dealers have shared their tips on how to ensure your operation gets off to a quick start.

Biggest Challenges Today

A significant factor in new year planning is being aware of the challenges affecting our industry.

Politics

The full impact of the 2018 midterm elections remains to be seen, but it will undoubtedly leave a measurable impression on the industry. While the elections delivered mixed results, a Democrat-controlled House — and some states — has the industry firmly in its sights. Several candidates ran on an openly anti-industry/firearm platform, achieving wins in Colorado’s 6th (Jason Crow over five-time incumbent Mike Coffman) and Virginia’s 10th (Jennifer Wexton succeeded two-time Congresswoman Barbara Comstock) Districts.

The industry’s complex and interconnected relationship with politics looks set to continue in 2019.

“The challenges out there are politically involved as to how the market will react. We don’t have the hype built up during the Obama years, and Republican control has helped normalize the market, but there are still challenges,” said John Paulk Jr., CEO of Shot Spot in Carollton, Ga.

A perceived threat from a Democrat-controlled House opens up the door of opportunity for sales of previously targeted products, according to Clay Ausley, owner of Fuquay Gun in Fuquay-Varina, N.C.

“The black gun and high-capacity firearms could very well gain more traction in 2019,” he said. “With election talk and the Democrats taking control of the House, 2019 will be stronger than 2018 as everyone prepares for gun control to be an inevitable headline again in the near future.”

Slowed Retail Sales

After years of record-setting growth and wild swings in demand, the market has changed significantly since 2016. John Phillips, president and founder of Poway Weapons & Gear Range in Poway, Calif., forecasts a continuation of 2018’s slowed sales.

“The biggest challenge the firearms industry will probably continue to face through 2019 is the very low retail sales volume. It seems the political environment will continue to be viewed as being able to ‘control’ new gun regulation, thus the emphasis to get out and buy will continue to be low,” he said. “Additionally, due to buying the industry saw over the Obama years, there seems to be an over-saturation that needs to be absorbed by the customers and retailers. These sluggish retail sales will make it hard for many retailers and manufactures to survive.”

Online Retailers

Online-only retailers have posed a significant obstacle for dealers in recent years, but the U.S. Supreme Court’s June 2018 ruling in South Dakota v. Wayfair Inc. — opening the door for requiring online retailers to collect sales taxes even in states where they have no physical presence — has the potential to level out the playing field for storefront dealers.

“With the recent Supreme Court ruling, online gun buying is going to change drastically. The whole concept of people saving money on taxes could be on its way out; I see it changing customer habits,” said Ryan Burt, CEO of Calibers Shooting Sports Centers in Albuquerque, N.M. “If someone is saving 7.5 percent on taxes they’re generally going to buy online, but this ruling opens up some opportunities.”

“If the industry is changing and online competition is here to stay, then we need to evolve,” added Adam Wagner, general manager of A&P Armory in Magnolia, Texas. “However, this ruling could have a huge equalizing effect. I’ve been on industry calls with some of our online competitors about this very thing. They have hired a team of consultants to figure out how to handle the state sales tax issue. So the sales tax parity could have huge implications.”

Ausley shared two considerations to counter the lure of online buying.

“It’s very important store owners are comparable in price to online while providing top-notch customer service,” he stated. “Don’t forget to keep items in stock because today’s average consumer is impatient and price and service will be forgotten quickly if you don’t have what they need now. If you don’t have it, they’ll order it before they get in their car to leave your shop. They want it now, for a good price and great service — if you fail at any one of these, you’ll take a hit to the bottom line.”

Growth Points

Despite the challenges noted above, there are several categories primed for growth in 2019 — affording new opportunities for savvy dealers.

Self-defense training, in particular, remains a considerable bright spot.

“Most growth over the next year for our organization will be in memberships and training,” Phillips lends. “We have continued to see year-over-year double-digit growth in membership sales and related residual revenue growth. Training also continues to grow — due primarily to the fact members really want to get the most of their membership, thus access to training classes and related discounts.”

Paul Rodriguez, general manager of Second Amendment Sports in Tucson, Ariz., shared his store has earmarked several leading categories to focus on this year.

“Accessories and upgrades, self-defense/personal protection, fire prevention/safety, female empowerment through proper firearms introduction and training are segments primed for growth in 2019,” he said.

A self-described “new kid on the block,” Cheryle Rebholz opened Bear Arms in Mequon, Wis., late 2018.

“The women’s market has become the fastest-growing demographic in the firearms industry, and from my personal experience, one that is underserved,” she informed. “My goal is to train individuals, especially women, on how not to be a victim.”

In addition, Rebholz has keyed in on the “entertainment” value the industry offers, by housing a MILO Range simulator on site.

“The virtual theatre has over 800 scenarios and is not limited to just firearms training, but dives into self-defense and gaming scenarios for social events,” she added.

Shot Spot National Sales Manager Chase Chambers predicts the continued expansion of the indoor shooting range segment of his business and others around the country.

“The indoor shooting business is set to grow tremendously,” he observed. “We’ve talked to other dealers who plan to expand their rental fleet of guns because they’re anticipating more people are going to want to come indoors to shoot. Sales of firearms may not grow as much as the range business in the next 12 months.”

The Bottom Line

Bottom line, it will take tenacity, a healthy dose of grit, an optimistic mindset and innovation to “hit the ground running” in 2019. Dealers outlined some final thoughts to consider as we move into the new year.

“2019 will require strategic purchasing and staying on top of buying trends for sure,” Ausley lends. “We need to be able to turn on a dime to chase down the buying trends and stock up before it’s too late and the trend changes again. Those store owners who are truly paying attention to the customers’ wants and needs will be the winners in 2019 as they have been in 2018.”
Phillips plans to lean heavily on the impact a positive, well-rounded experience will have on a customer’s likelihood to plan a repeat visit.

“By maintaining a 5-Star rated facility and backing it up with outstanding customer service to ensure every member and guest has an exceptional experience, we will be able to motivate new members and guests to come in and visit,” he relayed. “If we do that, we will be able to continue to grow, even in a slower market.”

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