Posted: Friday, May 4, 2012 8:18 am By Bill Shea, Crains Detroit Business | 0 comments
Fears linked to November's election, street crime, civil unrest, doomsday prophecies and even a zombie apocalypse have metro Detroiters buying firearms at a brisk pace. But the boom times in gun sales are not as lucrative for local gun shops as they could be.
That's because gun retailers can't get more weapons from manufacturers, which are flooded with orders for the most popular pistols, rifles and shotguns, according to Crains Detroit Business.
Royal Oak-based Target Sports normally sells about 10 guns a day, but that has increased to 30 a day this year, owner Ray Jihad said.
He'd be selling even more, if he could get them.
"I don't have any Rugers. There are a few models we sell a lot of, but I can't even get them," he said. Southport, Conn.-based Sturm, Ruger & Co. Inc., which makes rifles and handguns, has been so swamped with orders that it has stopped taking new requests until the end of May.
In January, Jihad ordered $350,000 worth of firearms from Exeter, N.H.-based SIG Sauer Inc., the U.S. subsidiary of a Swiss-German arms manufacturer that supplies much of American law enforcement. He's been able to get only $150,000 worth of firearms delivered so far from his order but has sold $75,000 of it.
Worries about stricter gun laws after the upcoming presidential election are the driving force behind the firearms sales surge, said Lawrence Keane, senior vice president and general counsel at the nonprofit Newtown, Conn-based National Shooting Sports Foundation, the gun industry's trade association.
"There is significant concern among the consumers that in a second term by the administration they will pivot on the gun issue and pursue policies that will restrict their Second Amendment rights," Keane said.
There was a rush on guns and ammunition after President Obama's election in 2008, but that has paled in comparison to recent months, Keane and local gun store owners say.
"It's amazing," Keane said. "It's breathtaking to see. I've never seen anything like this."
There has been a month-over-month increase in point-of-sale federal background checks required for retail firearms transactions -- the National Instant Criminal Background Check System -- for 22 consecutive months, Keane said.
While background checks don't automatically mean a gun was sold at the time of the check, they're the industry proxy for measuring sales trends.
The federal checks have increased 33.5 percent in the past five years, according to NSSF statistics, and three of the busiest days in background check history have come in the past few months.
There's also been a steady rise in the number of permits to carry a concealed handgun in the state, according to Michigan State Police records.
As of April 24, there are 316,786 valid permits in the state, up from 294,037 last year and 217,443 in 2010.
Political speculation
What analysts say is the "Obama effect" has translated into a financial windfall for the gun industry. The foundation estimates that firearms and ammunition had a $31 billion economic impact in 2011, up from $19 billion four years ago. That estimate is a blend of direct and induced economic impact of gun and ammunition sales, gun industry jobs and taxes paid.
Target Sports customers worry about the president's re-election, Jihad said.
"He would be a lame-duck president. If he wanted to, he could reinstate the assault weapons ban," Jihad said, referring to the expired 1994 federal law that outlawed certain semiautomatic guns and weapons that had two or more specific features, such as telescoping stocks and pistol grips.
Store owners say fear of a new ban on certain weapons -- the gun industry refers to them as "modern sporting rifles" rather than assault rifles -- has led to increased sales of the popular AR-15, a semi-automatic version of the U.S. military's M-16 rifle. It can take months to get in some variations of the rifle, Jihad said.
The average margin on gun sales is about $50 to $100 per firearm for Target Sports, Jihad said.
Worries about stricter gun laws aren't limited to the president. Presumptive Republican nominee Mitt Romney was governor of Massachusetts, which has some of the country's toughest gun laws, Jihad said.
Obama and Romney have both publicly reiterated their support for the Second Amendment right for individuals to bear arms.
Don Haigh, co-owner of Firing Line in Westland, said the improving economy also boosts gun sales.
"People are back to work and unemployment is down. People are getting bonuses, and buying guns because they love them," he said. "We're selling guns more than we ever have."
But Steve Graebner, owner and president of Wessel Gun Shop Inc. in Warren, said the lingering tough times have some buyers seeking guns on a budget.
"The least expensive firearm is the most popular in my store," he said, adding that the first three months of 2012 have topped any stretch for sales in the past 10 years.
The shop sells used and vintage firearms, but it also is a retailer for the inexpensive new guns made by Mansfield, Ohio-based Hi-Point Firearms Inc., which sell for as little as $195.
Graebner also said the gun backlog is partly due to companies such as Ruger offering packages to retailers, such as "buy 10 guns, get one free," which proved to be popular. Then all the packages were submitted for fulfillment and Ruger's production was overwhelmed with the wave of new orders.
Other factors boosting gun sales include a surge of women entering shooting sports and buying firearms for self-defense, the NSSF's Keane said, along with a flood of first-time shooters. The foundation's annual retailer surveys show that female customers have been on the rise for most respondents.
Keane said an analysis of gun sales reveals that about a quarter of gun buyers are rookie owners, and participation in safety and training classes is rising. He said the national trend of firearms hunting licenses issued yearly has increased after several years of declines.
A change in cultural values also has benefitted firearms sales.
"It's become socially acceptable to own a gun and go target shooting again," Keane said.
Crime and street violence also has people scared into buying guns for self-defense, Jihad said. Fears of urban unrest stemming from the killing of teenager Trayvon Martin in Florida have prompted some gun sales, he said.
"It's spilling everywhere throughout the United States," Jihad said. "There are a lot of people that are arming themselves."
Other buyers
Another group of gun buyers lately are those worried that the world will end in some way, possibly at the end of 2012 because of an interpretation of the ancient Mayan calendar. Others think civilization could collapse because of economic problems or natural disaster -- a cadre of people featured in new cable shows such as "Doomsday Preppers" on the National Geographic Channel and "Doomsday Bunkers" on the Discovery Channel.
"I have people coming in here that are stocking up on ammo and guns. They've got places up north. They're worried about if the grid fails," Jihad said.
Then there are the zombie enthusiasts.
The undead have exploded in recent years as a pop culture fixation: There are zombie books and video games, and cable channel AMC has a hit with its "The Walking Dead." Hollywood regularly churns out zombie movies such as "28 Days Later" and the "Night of the Living Dead" franchise.
The gun industry noticed.
Grand Island, Neb.-based ammunition maker Hornady Manufacturing Co. recently introduced "Z-Max" bullets that are marketed, as a gimmick, at killing the undead. Same goes for New Haven, Conn.-based O.F. Mossberg & Sons, which rolled out a series of rifles and shotguns marketed for zombie killing.
"The whole zombie niche has taken off and the (gun) market has responded," the NSSF's Keane said. "It's become a big thing in which people have these shooting competitions (to shoot zombie targets)."
Jihad has seen consumers into the zombie stuff.
"It's a big craze right now," he said. But of the niche buyers, he's seeing more revenue from the doomsday crowd.
"That's very real," he said.
Information from: http://www.crainsdetroit.com/article/20120429/FREE/304299966/gun-jam-sales-clog-as-fears-election-doomsday-etc-rise#