Gun Makers and Retailers Post Strong Sales Increases

Sour Economy, Potential for Tightened Regulations Drive Buyers to Firearms

By Published on .

NEW YORK (AdAge.com) -- The economy might be tanking, but firearm sales are going great guns.

Despite the weakest holiday season on record, outdoor-products retailer Cabela's turned in strong fourth-quarter sales, largely as a result of an increase in firearm and ammunition sales. Smith & Wesson is reporting pistol sales up 40%, and Sturm, Ruger & Co. reported an 81% increase in firearm revenue.

Cabela's: Retailer turned in strong fourth-quarter results thanks to firearm sales.
Cabela's: Retailer turned in strong fourth-quarter results thanks to firearm sales.
In November, on the heels of Barack Obama's election, background checks for firearm sales jumped 42% to a record 1.5 million. But that pace has not abated, with a 24% rise in background checks in December, a 28% uptick in January and a 23% increase in February.

A new Democratic administration typically heralds a rash of gun purchases, as consumers fear the possibility of more restrictions on firearm purchases -- the election of Bill Clinton in 1992 accompanied an 18-month surge in firearm sales. But industry experts say the tough economy, along with a desire for leisure activities close to home, will ensure strong firearm sales in the coming months, regardless of the attention the Obama administration gives to gun issues.

BRIGHT SPOTS
Opportunities for the marketing and media industries in an otherwise bleak year
"The continued increase in gun sales can be attributed to both political and economic factors," said Ted Novin, director-public affairs for The National Shooting Sports Foundation. "In tough economic times, more people become concerned about security -- a strong reason to purchase a firearm. Similarly, when income is an issue, it's reasonable to believe that hunting becomes that much more popular. Hunting in the field, as opposed to a local grocery store, ensures safe, high-protein food at a much lower price."

Care of one's own
Eric Zinczenko, publisher of Field & Stream and Outdoor Life, said hunting is the only hobby where you can go out and "bring your dinner home." He added, "The ability to feed your family in these tough economic times [is] a point that we're seeing is not lost [on consumers]."

Sales figures at a host of manufacturers and retailers are surprisingly robust, given consumers are reigning in their spending habits. Regarding Cabela's strong fourth-quarter sales, President-CEO Dennis Highby said sales at stores open at least a year, which rose 2%, would likely have been down 1%, excluding firearm and ammunition sales.

"We're excited that we have the merchandise that people want in this type of environment," Mr. Highby said during a call with analysts. "We saw strength in ammunition, firearms; reloading was big; archery was strong. He added that those categories remained strong in the first six weeks of the year.

BassPro, a privately held company, also reports its sales are robust. Larry Whiteley, a spokesman for the company, said that the company had a "very good" fourth quarter and a strong start to 2009. Mr. Whiteley said firearm sales are up but added that the fishing category has been outperforming as well.

On the manufacturing side, publicly traded firearm manufacturers, such as Smith & Wesson and Sturm, Ruger & Co. are enjoying strong sales and relatively steadier stock prices. Smith & Wesson said aside from the 40% growth in pistol sales in its most recent quarter, tactical rifle sales soared 308%. Sturm, Ruger & Co. reported an 81% increase in firearms revenue. In a message on its website, Rock River Arms, which specializes in custom rifles and pistols, cites an "overwhelming increase in orders" in explaining why it can no longer provide estimated delivery dates, and notes that it is increasing production.

In this article:
Most Popular