A Repeat Performance?

For those of us who were in the industry back during the 2016 election year, it was quite the rocky ride. Business was good. Gun control was a leading topic on the campaign trail — creating tremendous uncertainty about what the landscape of firearm legislation would look like for the next four years. 

At the time, most existing shops bet big (and I mean big, in some cases) — with owners ordering two, three and even four times their normal inventory amounts. These decisions were made with the single-minded certainty gun sales would be fast and furious, and it was the time to secure inventory and take advantage of an opportunity to make their retirement in one year. 

And then election night happened, and amid all the energy and celebration of the moment that — by some miracle — Donald Trump had won the election, a looming storm cloud on the horizon was largely ignored. This storm cloud became known as the “Trump Slump.”

When A Wager Backfires

Sales volumes plummeted as the buying public felt safe knowing President Trump was highly unlikely to endorse any legislation that would negatively impact citizens’ rights to own and purchase firearms. 

Quickly, the industry started to choke on extremes of excess inventory. Manufacturers, distributors, vendors of all types and retailers were all drowning in excess inventory and cash flows came to a screeching halt. As is always the case in this environment, someone eventually cracked due to the desperate need to have cash that outweighed their need for inventory, and prices started to drop.

Guns, accessories and even ammunition hit all-time lows (when adjusted for inflation). Businesses struggled to stay afloat, distributors went bankrupt and manufacturers shuttered their doors — all as the consequences of an unexpectedly slow sales environment unfolded.

This “slump” persisted 2017 through 2019 and was only alleviated by the surge in panic sales brought on by the confluence of a worldwide pandemic and periods of civil unrest in 2020.

So, yes, the first election of President Trump essentially brought about a very stagnant, price-crushing period in the firearm retail industry that many did not survive. It was rescued by unprecedented global and domestic issues.

Are we setting the stage for a repeat performance? Let’s examine.

2024 vs. 2016

The next part of the equation to form a picture of what Trump’s second term may bring for the industry is pre-election market conditions. Back in 2016, business was strong and lively — for several reasons noted above.

In contrast, the run-up to Election Day 2024 saw market conditions already in a slump. 2023 sales lagged behind sales figures for 2022, and this trend continued into 2024. Depending on the region and product category, year-over-year sales figures were down as much as 30% last year. 

This market trajectory, spanning multiple years, further underscored a rationale of managing inventory positions to better reflect the market at hand and not gamble on a “what if” future. In tandem with this tight inventory planning, retailers were not placing inflated orders for future delivery. In fact, the supply chain was experiencing inventory back-building and distributors were already feeling the pain of being over-inventoried. As a result, manufacturers were not increasing production.

Market Hangover

The last piece of the puzzle that will influence the next four years is the market hangover from the boom years during the pandemic. When you look at the typical capacity of the firearm industry to sell goods, the pandemic boosted the sales volume by roughly 35%. 

Historically, market booms in our industry tend to create “buy into the future” consumers, where they buy multiple years’ worth of sales in a much shorter period — rather than creating increased market capacity.

Once the incentive for consumers to pre-purchase the goods they need abates, we have seen a correction in the market that creates a decline nearly identical in magnitude to that of the boom. 

When we put a lens on the current market and utilize this same assumption, it bears out there is still a downward correction in sales dollar volume for 2025 of about 5% year over year. After this 5% correction, we may transition into a “flat to a slightly improving” market.

Rx For The Next 4 Years

When we combine all the above factors, we can create a prescription for the next four years (assuming there is no global disruption or unpredictable civil unrest). The signs are plentiful we’re moving into a flat sales environment, both in unit volume and pricing.

Inventories will not foster a need for accelerated “race to the bottom” pricing due to relatively appropriate amounts of inventory already in the pipeline. This condition will also, unfortunately, see many businesses whose success was tied to the inflated sales volume of the pandemic years go out of business — which will funnel sales volume into the stores that persist. 

Success will be largely based on customer service rather than product availability. For those able to pivot to the current market conditions, profitability will be centered around high levels of customer satisfaction, efficiency and vigilant attention to inventory management.

The next four years are full of opportunities for businesses that can take advantage of some of the most predictable market conditions we’ve seen in a decade. To do so, it means acting now, being persistent and making a change before you’re forced to. 

If we insist on giving a name to the next four years, instead of “Trump Slump 2.0” let’s go with “Trump Jump” — as we’ll see thriving brands fundamentally altering how they do business.

Dealers, we invite you to weigh in — will we see a “Trump Slump 2.0” or are you making adjustments to facilitate a “Trump Jump?” Let us know: comments@shootingindustry.com.

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