The Gun Counter

Posted: **Wed Apr 22, 2009 9:04 pm**

Brought to your attention by: KNOW THY ENEMY™©

Tactical Life

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Sportsman’s Warehouse Bankruptcy Filing Contains Lesson for Industry
NASGW

Shock waves were sent through the industry from the late March announcement that mega outdoor retailer Sportsman’s Warehouse filed for Chapter 11 bankruptcy protection. While this is a severe blow to many whose distribution relied on this outlet, it reinforces and illustrates the viability and sound business approach of the two-tier distribution system espoused by the National Association of Sporting Goods Wholesalers for so many years.The filing leaves a number of shooting sports industry manufacturers with more than $22 million in unpaid invoices. With today’s credit crisis making front page news, the financial difficulties caused by this filing are another example of how important the wholesaler is in the overall supply chain process.

It’s the tried-and-true approach advocated by the NASGW, whose members consistently take the inventory risk — the financial risk associated with a credit sale; and pay their bills on time. Additionally, since wholesalers’ very business is the sale of large volumes of merchandise, manufacturers are assured that their wholesalers will turn their product over.

The current state of the U.S. and global economy has created an environment that is hardly “business as usual” for any of us. However, the benefits offered by the 2-tier distribution system, supported by distributors serving as solid partners with manufacturers, lends to a foundation of stability for independent businesses and our industry.

Posted: **Wed Apr 22, 2009 9:38 pm**

I see closed business every day now. I cannot remember a week that not another major chain is going down the tubes. Just today the IMF stated the banks will need an additional 4 trillion dollars. It is obvious to anyone that this cannot continue in the benign manner. Sooner than later, something is going to go BANG!!!
I think this problem is bigger than the Depression of the 30's, 20's and even the carter years combined. What if this deline continues for the next five years?

Posted: **Tue Apr 28, 2009 10:37 pm**

Then people will start small and work it smart again. the lessons are painfully learned and quickly forgotten. It will mean that our way of life has been irrevocably altered for the remainder of our time on this mortal coil.

start your small business and avoid debt like it is the rattlesnake's fangs. before long you will start to grow either because you the most desirable or perhaps the ONLY game in town.

Your empire will slowly form. The key is to make sure that nobody can take it away from you.

Posted: **Thu Apr 30, 2009 1:35 pm**

Maybe more people need to run their businesses like the Menards home improvement chain. The Menard family owns all of it, they have a strict cash-only policy with their vendors, and once the deal is made and the hands shaken, the vendor has a check in his hand for the full amount within 48 hours. No debt, no credit hassles, and it's easier for their accountants to explain to the employees where all the money goes. On top of it, when they build a new store the property and inventory are already paid for in full, so you're essentially making profit from day one (minus maintenance costs and payroll, of course) and not worrying about losing any vendors if you don't show a profit. I didn't work for their company for long, but I'd go back in a heartbeat if my state job dried up. There are nicer people to work for, yes, but they might not have the financial stability that Menard's does.

Posted: **Fri May 01, 2009 2:33 am**

If a place that sells guns and ammo failed in this market, they were grossly incompetent.

Many companies do get hung up in "expand or die." It's hard to strike a balance, and put the effort into minding the current company, rather than becoming absorbed in what you want the company to go (I've decided that, no matter the size of the company, it's really a handful of people who are really key/have the ability/info to see overall trends of the company.)

Manufacturing is even more tricky -- there's always something newer and better than can yield great returns... and usually requires an upsurge in sales to support.

Posted: **Fri May 01, 2009 5:50 am**

Aglifter wrote:If a place that sells guns and ammo failed in this market, they were grossly incompetent.

Yes, but I think their fate was sealed (through incompetence) prior to November. It seems to me if I were a distributor of guns and ammo, and I was having no trouble selling everything I could get my hands on, I would give priority to retailers known to be capable of paying me. Once the market reached the point of scarcity, not even the frenzied sales could save SW, since if I am correct in my thinking, the product was sent to the paying customers instead.

Posted: **Fri May 01, 2009 4:09 pm**

IIRC They sell more than guns and ammo and that is probably where the bulk of the problems arose.

Posted: **Sun May 03, 2009 7:01 pm**

I would imagine they ran into trouble when they got away from their core mission - like so many other companies. They start out well in one area and wind up in trouble because they try to "diversify" into other areas that sap the vitaliy of their original business.

Posted: **Sat May 09, 2009 7:47 pm**

It doesn't really surprise me. I've never really bought stuff from there, it never seemed like they had what I was looking for.

Posted: **Sun May 10, 2009 1:12 am**

Ah, Poop! There is a SW near my house. Since we don't have Bass Pro Shop, it's about the only game in town. I'm gonna miss them. Decent prices on handguns, plus they have the only local, bulk stock of .32 S&W and .32 H&R Magnum for my Nagant Revolver.

The Gun Counter

Sportsman’s Warehouse Bankruptcy Filing

Sportsman’s Warehouse Bankruptcy Filing

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