Yesterday I posted an article about TrackingPoint’s restructuring following a conversation with their CEO, John McHale. The fact that they ceased operations followed by a big restructuring gave the impression that they were cutting their costs to remain profitable … and John took exception to that idea. He called back to explain what’s going on, and I felt that the information he gave me was sufficiently interesting to warrant revising and extending the article and an update with his comments . . .
According to John, the market for TrackingPoint products was strong and continues to be so. The company grew over 200% in its first year and orders quickly outpaced their ability to manufacture the firearms. In the eyes of TrackingPoint’s main man, that market isn’t drying up any time soon, but he was reluctant to get into specifics about their forecast of the market and its ability to keep buying their guns.
There’s no doubt that at some point the demand for firearms that cost as much as a new small car will be saturated. But according to TP’s numbers that isn’t something they’re worried about right now. Much like the market for other high-end items like private planes and African safaris, it seems like there are always more people out there who are waiting to plunk down their cash and get a piece of the action. And McHale believes that they aren’t even close to that saturation point.
Even then, their new plan to focus on creating a community around the brand and pushing the TrackingPoint experience should keep the existing customer base engaged, pumping more money their way.
The real grand prize, of course, would be a government contract. There’s already some work going on between TrackingPoint and the military to get some of their tech into the hands of American soldiers, and if they can get their guns into the armories of the armed forces, that would really start the cash flowing. Either way TP seems on stable footing. For the moment.