As Reuters reports,
United Sporting Cos, a large firearms distributor whose roots date to the Great Depression, filed for bankruptcy protection on Monday and said it plans to liquidate, hurt by falling sales after President Donald Trump was elected and as Dick’s Sporting Goods Inc began moving away from firearms.
United owns longtime distributor Ellet Brothers, which is embroiled in a lawsuit over allegations that the parent company drained it of cash. United also bought some of the remaining assets of bankrupt distributor AccuSport a year ago.
In addition, United reportedly made a big bet based on the outcome of the 2016 election. According to Bloomberg . . .
Firearms distributor United Sporting Cos. loaded up on guns ahead of the 2016 U.S. presidential election, expecting a surge in sales that would likely follow the election of a Democrat. Then Hillary Clinton lost.
The miscalculation sparked a multi-year decline that has reached the courthouse steps in Delaware, where United filed Chapter 11 bankruptcy on Monday.
When Republican Donald Trump emerged victorious in the election, United posted lower-than-expected sales as well as high inventory carrying costs, Chief Executive Officer Bradley P. Johnson said in a court declaration.
A number of distributors have had a difficult time in the last few years as a result of lower-than-expected gun sales as well as changing trends in the industry which have seen some manufacturers move away from the traditional distribution system toward more direct sales with large and medium-size retailers.