Want To Make A Million In The Gun Business? Start With Two Million.

              Everyone in Gun-control Nation is exulting over the latest news about how the NRA is in a state of free-fall collapse. But there was another piece of gun news which is far more important in terms of what it says about the future of America’s love affair with guns that gun-control advocates and noisemakers completely missed.

              I am referring to news out of South Carolina that a company named Ellett Bros., has filed for bankruptcy, an event hardly making a ripple in Gun-control Nation, but I can guarantee you was of great importance to the gun industry itself. This is because Ellett’s happens to be, or happens to have been, one of the largest gun wholesalers in the United States, and if you are or were a retail gun dealer, sooner or later you bought something from the sweet ‘thangs’ salesgirls who used to answer the Ellett phones.

              I visited Ellett’s back in 1976. As a certified gun nut, going to Ellett’s was the equivalent of a Muslim making the pilgrimage to Mecca during Holy Week. You could stand at the end of a big room and watch all the women busily taking orders and whispering sweet nothings into their customer’s ears, or you could glimpse inside the warehouse and see thousands of guns stacked up just waiting to be shipped. You might even get an opportunity to shake hands with one of the Ellett family members himself!

              What made the Ellett operation so successful back in the day was that it was the only gun wholesaler whose inventory basically contained not only every, single gun that was being made, but you might also be able to buy parts for old guns that needed to be repaired. For those of my readers who don’t know anything about the gun business, which happens to be most of my readers, always bear in mind that guns don’t wear out. So just about every guy who comes into a gun shop sooner or later needs a new part for an old gun. And who carried all those parts?  Ellett’s, that’s who.

              In addition to an enormous inventory, Ellett’s also pioneered telephone marketing at a time when most of the other gun wholesalers were still relying on catalog sales. This direct-sales approach, along with an annual dealer’s show which drew just about every retailer in the Southeast, made Ellett’s the powerhouse wholesale operation for much of the country east of the Mississippi River, particularly when they acquired another wholesale house, Jerry’s Outdoor Sports, which catered primarily to retailers in the Northeast.

              So what happened to bring about the collapse of Ellett’s at a time when, thanks to Obama, the gun business had enjoyed its best sales years of all time? To begin with, nobody in the gun business believed that Sleazy Don was going to move into the White House in 2017, which meant that Ellett’s, along with everyone else in the distribution chain, loaded up inventory anticipating that Hillary’s election would prolong and even increase the demand for guns which occurred during the Obama ‘regime.’

              The other problem in the gun business is that the distribution system is regulated end-to-end because of licensing requirements, which means you just can’t dump unsold inventory into a job-lot retailer or maybe ship the stuff overseas. The moment that gun owners stop coming into retail stores to buy more guns, and it’s always the same people who keep buying guns again and again, the retail inventory backs up, the wholesale inventory doesn’t ship out and someone gets stuck with the unsold load.

              Not only did Ellett’s bet the wrong way in 2016, but so did everyone else. Another major wholesaler, Accu-Sport, filed Chapter 11 last year, which means that the unsold inventory of two major distributors is available at rock-bottom prices. Which means that if you want to make a million in the gun business, now you have to start not with two million but with three.

Advertisements

1 thought on “Want To Make A Million In The Gun Business? Start With Two Million.

  1. My guess is that the gun industry as it’s set up in the United States is in for a rough future. Fewer people want to buy guns and, as you say, Mike, guns are super durable. And their technology has basically been stagnant for decades.

Leave a Reply