A few days ago news broke that Remington layed off 122 employees at their Ilion, New York plant. While some have tried to claim there is no post-election slump, the actions of a number of manufacturers say otherwise. SilencerCo, Colt, and others have taken similar steps to trim labor costs in order to navigate the new lower-demand economic conditions hitting the industry. And this probably won’t be the end of these stories.
Word now comes from Remington that another round of cuts is being made at facilities outside of New York affecting more strategic level employees as well.
According to our source (which has since been confirmed by Remington) the affected employees include a number of director level and higher placed individuals. At least one VP left voluntarily in advance of the layoffs to pursue other interests.
Remington Outdoor’s media relations and public affairs manager Jessica Kallam released this statement:
Earlier today we made the difficult decision to release 34 employees across ROC locations.
These changes, while difficult, are necessary to ensure the Company’s long-term success in a rapidly changing marketplace. We are assisting affected employees through severance packages and other benefits to facilitate their transition.
Again, these aren’t likely to be the last firearm industry job cuts we’ll see as companies adjust overhead to operate in this new lower revenue environment.
Spend during the boom, cut back during the bust. Exactly the reverse of what should happen.
Wonder if these companies have the foresight to evaluate the political trends and recognize that new elections in 18mos could put us back into panic buying? And that they will remain forever behind the business curve.
Cerberus, the same outfit that wrecked Chrysler, bled Remington for a long time before spinning off what was left. Along with their same management DNA that has no idea of how to run a company for the long term, only how to squeeze short term profit. This is very sad, but it’s completely outside of our control.
It is ironic that the candidate supported by the gun industry and the NRA would be exactly the worst thing that could have happened. Just another example of the admonition, “Be careful what you pray for.”
Had Hillary been elected, there would have been a short term firearms boom followed by the complete destruction of the industry. There would be no more semi-autos or pumps or military looking firearms. Even pellet guns would have to be registered. Lawyers would be gutting the entire value of every firearm and accessory manufacturer. And yes, we would all be turning in or burying our newly illegal guns, starting about now.
In any case, the long term trend of firearms sales is still positive if you exclude the Obama panic aberration.
As I have said before, a ‘normalization’ had to occur or the entire market would saturate & come to a virtual grinding halt. Remington & Colts problems are bad management, not Trump being elected. If you look at firearms sales they are still very good, some of the best. Companies that listen to the consumer, can we say Ruger, you will prosper. And if the Hideous Rotten Criminal would have won, I agree that even pellet guns would be severely regulated. Look to the UK; even NJ considers a pellet gun a firearm. You can not continue to run at full throttle without a catastrophic crash.
“…even NJ considers a pellet gun a firearm.”
Where we live, “…any object that has the capability to launch a projectile of any material is classified as a firearm.” This means toy bows and arrows with soft/nerf tips. Spoons, (we warn the children not to flip peas and potatoes at each other when we are at Golden Corral), sling shots, BB guns, maybe even large rubber bands. Haven’t read anything about classifying hands and feet as firearms.
The “Company’s long-term success in a rapidly changing marketplace.”
Big green did this back in the 1800s when gun sales slumped. That’s where Remington typewriters came from.
Well here we are again. Of course today there are a few more gun companies to compete with, a few more types of guns that the public wants, and a vastly higher bar for quality. Seems big green cannot compete on any level. Well except with the 870. But they’ll screw that up too sooner or later.
And how many from the QA team?
Bwahahahahahah!
My comment was based on the fact that QA is often seen as a COST center and NOT a revenue center. Hence it is often one of the first sections to be cut and subsequently eliminated. It is often the start of a company’s death spiral.
Sorry, my humor is oft times a bit abstruse. The implication of the laugh was that were there any QA people, they were let go many years ago.
None.
Hmmmm…I’m about to purchase my 3d gun since the election. And more after that. NO plans for any Remington products(well maybe ammo). When Ruger does layoffs l’ll care…quality will out.
At the one Ruger plant where friends I have work at are, so far, still are at full NINE shifts. Hope it continues.
So shocking that a company selling sub-par products takes a sales hit when people won’t buy trash out of desperation. Circling the drain like Colt…
Big Green turning to Little Green turning to Pale Green before our very eyes. That’s what happens when quality goes to hell and the beancounters running the business don’t care about the customers.
” beancounters running the business”
Worked for a big name manufacturing company. Accounting dept required all machinery be operated at 85% capacity, or greater. We made hundreds of pounds of unsalable stock items, which were written off after being unsold on the shelf more than 24mos. All those scrapped items bore the cost of acquisition, storage, machining, inventory control. Each year, the CEO would fire the inventory manager because of the loss of excess, unsold items. The losses were never re-calculated into total cost of production, thus we lost money on some lines, year after year. But the equipment utilization kept the accountants happy. They in turn blamed inefficiencies on every other department.
Blaming the wrong people. I’m an accountant so I can speak for my peers. Accounting just records and analyzes. Someone else always interprets our results (usually incorrectly) and then makes decisions based on those results and incorrect interpretations. They then blame accounting.
If you look into whose bonus is contingent solely on production, and/or meeting arbitrary metrics like mantaining operations at 85% capacity, you’ll quickly figure out who made the call.
“Accounting just records and analyzes.”
That’s what accounting is supposed to do, but when the accountants run the business that’s not what they actually do. This is especially true in many public companies, where the business operates on a short term basis to juice up the stock price and executives bonuses, and the long term be damned.
As it happened, I had several run-ins with the accounting department. Indeed, the company operated with the utilization rate established by accounting as a “best practice”. In another instance, we had a team that worked with over 300 suppliers to cut prices if we would institute immediate “payment on dock” for their goods. The discount would be 7% off invoice (the payment was recovered if defective goods were delivered). The CEO and COO were quite pleased with the team’s achievement, but the CFO killed the idea. Her statement to the CEO was that we should delay payments until virtually sued, as money remaining in the treasury would gain interest. CEO stopped our team, and cancelled the discount agreements. I later cornered the CFO and asked why she wanted us to not have a cost and price advantage over competitors. Her reply was that she had arranged her entire bonus to be based on the amount of revenue she generated in treasury. Her proud achievement was to turn accounting into a “profit center”, and an income stream for herself. In the next year, we discovered that our shippers were not charging correctly. Our estimate, based on a one day self-audit of schedule and actual shipping rates, was that the company was owed in excess or $1MM. The obstacle was that we had no staff to pursue the matter, and proposed overtime for a week to get a better estimate, and setup processes for recovering the overcharges. The CEO refused the overtime. The team contacted an intermediary (I forget the actual business type) who contracted to recover the charges for a fee of 30% of the amount recovered. We took this to the CFO for a courtesy briefing, before getting on the CEO schedule. The CFO threatened us and states she would not authorize any action that did not recover 100% of the overcharge. When we pointed out that there was no internal staff, nor overtime to do it in-house, she declared that it was only a million dollars, and we had better not carry our findings further. In another company, the CFO liked overstocked inventory because the value was included on the plus side of the P&L. As inventory manager, I said it was a liability because the best price we could get for outdated/obsolete material was seventeen cents on the dollar, thus the liability should be recorded as a decrement. The CFO said that was not IAW GAAP.
Business leaders depend on accounting to show them the safe course, not the profit course. That way, if things go wrong, CFO would get the glory.
I’ve met plenty of CFOs that were nothing but good hair. Bad managers are everywhere.
Remington makes absolute shit, and everyone knows it. Much like the bankruptcy of Gander Mountain, this has nothing to do with the sudden reduction in firearm sales and everything to do with shitty companies being rejected by the market. If we start seeing layoffs at Ruger, Sig, Mossberg, etc, then we can talk about the sales slump. But not before.
And your great judgement comes from where exactly? It is amazing how many keyboard CEO, CFO, & heads of Engineering, sales, we have here all of a sudden. But it is easier to throw labels like, “shitty products,” I guess?
Remington has product management?
Yes they do, but it is named ‘Piss Poor’.
Lots of ghost towns in upstate NY. Most were created by the first Cuomo (i.e., Mario) Regime. A second wave is underway thanks to the current Cuomo (i.e., Andrew) Regime.
“While some have tried to claim there is no post-election slump, the actions of a number of manufacturers say otherwise.”
Really? Then why did Remington have triple-digit layoffs in 2014 and 2015, at a time when other manufacturers were selling product like crazy?
It’s not a post-election slump for Remington. It’s an ongoing disintegration of the business due to incompetent management. Just like Colt, which had two bankruptcies before the “slump,” and SilencerCo, which is basically a startup that overbuilt.
Consolidation of the 12+ different companies that were all moved to Huntsville. There’s a lot of redundant staff when you do something like that.
If their customer service was ok and they hadn’t ruined Marlin and Bushmaster, and hadn’t sh**canned H&R and if their rifles only fired when the trigger was squeezed they might have done allright. Outside of all that everything is fine.
Spot on
Remington is a train wreck being milked for earnings. The fundamental question is almost always: “Out of all the options in the marketplace, why should I do business with you over the alternatives?” Remington hasn’t had a compelling answer to that question in most product categories for years, and the debacles of the 700 and R51, coupled with the destruction of AAC, eroded what little brand equity and trust that remained. I can’t think of anything they have that couldn’t be found elsewhere more affordably and of higher quality. Their plan to achieve irrelevance is nearly complete.
So sales go up under Obama and in anticipation of Hillary. Trump wins, sales go down, but now the libs think they need to start buying guns. Sales are still down, because libs discover they can’t pass the 4473 NICS checks they tell us don’t exist?
Even if there’s, technically, no slump at the moment, the manufacturers are clearly expecting one…..
Well if they’d stop pedalling half baked horseshit with no QC, they might not be in that situation.
You could say the same about GM & Chrysler.
Just the beginning for Remington and other gun manufacturers. This is the downside to the conclusion of the Obama/Clinton-induced gun panic. Demand has dropped, so layoffs are necessary to reduce costs in the face of fading earnings.