IBISWorld is not a theme park dedicated to wading birds of the family Threskiornithidae. It’s the self-proclaimed “world’s largest independent publisher of U.S. industry research.” As TTAG doesn’t have the world’s largest editorial budget, we can’t afford the 750 clams they’re asking for the full report on the state of the U.S. arms industry (x’s mark the spot). And even if we could stump-up the cash, we couldn’t trust ourselves not to scrape huge chunks of their analysis for our gun industry information-hungry readers. So we’ll just riff on the reader’s digest version by oregonbusinessreport.com, of all people. Your key, fair use takeaway: “Gun and ammunition sales grew 8.9 percent in 2009 to $10.4 billion, reports research firm IBISWorld. Although, a good portion of that growth came from huge military ammunition buys to supply troops in Iraq and Afghanistan. However, many NRA activists argue that the recent surge in gun and ammunition sales reflect consumer fear that the Obama administration would restrict sales. This year, the anxiety over gun control is easing, and industry will experience a 5.7 percent revenue decline according to IBISWorld, a national research firm.” As for the future . . .
IBISWorld analyst Nima Samadi predicts the industry will still grow at an annual rate of 3.7 percent from 2011 to 2015. The growth is down from an estimated annual pace of 6.9 percent for the five-year period ending December 31, 2010.
The Securities and Exchange Council (SEC) produced documents illustrating the net sales for the three months ended March 31, 2010 were $94.7 million, a decrease of $26.3 million, or 21.7%, as compared to the three months ended March 31, 2009. Centerfire rifle sales decreased by $24.2 million, or 27.8%, as compared to the prior-year period, primarily due to reduced sales demand for modern sporting products [assault rifles]. Shotgun sales decreased by $1.2 million, or 4.9%, as compared to the prior-year period. Rimfire rifle sales decreased by $1.0 million, or 14.4%, as compared to the prior-year period.
“Modern sporting products.” Ha! Score one for the euphemism brokers! Anyway, blame the Obama factor, or lack thereof. Now that it’s clear that our 44th president is no gun grabber, customers aren’t salting away guns for him not to grab. Or they’ve bought all the guns they can afford.
Once again, I’d like to point out that the industry’s single digit growth rate is actually pretty pathetic, considering the number of non-gun-owners in the U.S. Yes, non-gun-owners. Wikipedia:
In 2004, 36.5% of Americans reported having a gun in their home and in 1997, 40% of Americans reported having a gun in their homes. At this time there were approximately 44 million gun owners in the United States. This means that 25 percent of all adults, and 40 percent of American households, owned at least one firearm. These owners possessed 192 million firearms, of which 65 million were handguns. The number of American homes reporting have a gun in their homes is down from 46% as reported in 1989.
Six years later and the stats remain static: American firearm ownership still hovers in the 40 – 50 percent range. There are now at least 200 – 250 million firearms in the U.S. (last year alone, the industry unloaded some 14 million firearms). Given that most gun owners own more than one gun, and the U.S. population stands at around 308 million, we can only conclude that the industry is preaching—and selling—to the converted. And documented Americans.
Bottom line: guns don’t buy guns. People with guns buy guns. If the industry is to break out of single digits growth, it needs to reach out to new customers. The restrictions on advertising are the biggest roadblock. For example, when was the last time you saw a gun ad in a mainstream publication? It’s also true that Google AdWords isn’t available to firearms-related websites. Why doesn’t the NRA, or gun and ammo makers, make a bigger stink about that?