According to the New York Times, the Navajo Nation has made an offer to purchase the Remington Outdoor Company, which recently emerged from bankruptcy. The offer was for approximately half a billion dollars in cash.
The offer was rejected by the owners of Remington, Franklin Templeton and JPMorgan Chase. We can’t be sure of the reasons for the rejection, but the Navajo nation’s plans for what they wanted to do with the company certainly couldn’t have helped.
In short, they sought a strategy that has already proven near-fatal to other firearms manufacturers.
According to Andrew Ross Sorkin, the NYT’s article author, the Navajo nation’s proven to fail plan:
It intended to shift the company away from its consumer business, including curtailing the sale of the AR-15-style weapons frequently used in mass shootings, to focus on police and defense contracts.
The tribe planned to use profits from those businesses to invest in research and development of advanced “smart guns” — those with fingerprint or other technology intended to prevent anyone but the gun’s owner from using the weapon.
The Navajo Nation had apparently read Sorkin’s own brilliant idea for turning Remington into “The Most Advanced And Responsible Gun Manufacturer in the Country.”
The only problem with that plan is that there would have been no profits to invest in “smart guns” or anything else. Shifting away from producing products aimed at the massive purchasing power of the American consumer and toward government contracts is a proven strategy for failure.
Don’t believe me? Ask Colt, which went bankrupt specifically because they shifted away from focusing on the American consumer to primarily military and police contracts. That recent failure highlights that a single, fickle, expensive customer is never the right answer. It’s too hard to get in the door, and way too easy for that door to slam shut.
It might have been a great investment for the Navajo Nation to purchase Remington if they wanted to generate profits with a a company that makes guns. But that’s not, apparently, what this offer was all about.
A plan like this, something designed to appeal to the woke crowd, and not intended to boost the bottom line, is destined to fail in short order. That kind of thinking would only leave the already struggling people of the Navajo Nation with nothing to show for their cash but a half a billion of their dollars thrown into the wind.
I’d like to see Remington out of the hands of the bankers as soon as possible. Hopefully someone will come through soon and make an offer that focuses on the product lines consumers want, and continue the company’s increased focus on quality control that consumers demand.
This offer clearly wasn’t that.