Pete Brownell
Yeah, we've, we've been in business 85 years this year. Turned 85 in June, and we've seen ups and downs. We've seen the markets that were I'll call it at a three-generation high during the pandemic. Now, I think this market's also expressing a three-generation low as a hangover from that pandemic.

We're seeing that ebb and flow of the marketplace. Right now, we're in the ebb, but it's coming out of it. When you look at a longer timeline, every spike above the trend line is equal to the down. That's almost what we're seeing right now. It’s not as down as far it was up, but we're seeing the market come back from the peak of the pandemic. And we're seeing it in a couple different ways.

One of the most interesting ones, was a lot of firearms purchased. Every time there’s been a ban, or a threat of a ban, there’s been a lot of AR-rifles purchased. And a lot of bolt action rifles, interestingly, purchased. There were a lot of purchases during the pandemic.

Right now, there's a combination of what, I'll call a hangover from the high, and also the consumer saving rate and spending rate is is really causing people to hold their money, or at least get good value for their money.

So they’re not spending what they used to. So you can say that's a discount marketplace or deal marketplace.

What we're really seeing at our retail store in Greenville, Iowa, is a lot of used guns are coming out of the vaults. Those rainy day guns that people were buying it for, either: I couldn't get it, or I'm going to save it as an investment.

Those investments are coming back. We're seeing a lot. And it’s a story line across America right now as well. Retail stores have a lot of used guns right now. They’re coming into the store to be purchased, and those prices that are being bought back are at or below the purchase price of the original firearm.

So there's going to be some great deals for individuals looking for them. I call it the boomerang of a used gun being sold back to a retail store. It's going to drive a lot of good traffic to retail stores.

And it happened just before the season picks up, which is really about end of this month, beginning of next month; hunting season.

That's when people really start to come back into the retail stores. They're gonna be stocked with some good used guns.

Pete Brownell
It's really both. So I'll break it down into, like, your your AR 15. I'm gonna go out and look at the retail store right now. So we have a lot of AR-15s coming back in.

But really, what's interesting, and what's driving a lot of value, is that long term rifle, the long term bolt action rifle, is coming back into the marketplace as well.

It's like “have I used it in the last six years?” Or "am I going on those hunts? And do I need four of them in the vault?”

So we're seeing some good a lot of those come back to the retail store.

We're also seeing some really interesting revolvers and pistols come in too. It's going to be your Vaqueros - your cowboy action things. Those competitions that were really hot during the maybe 90s and early 2000s those pistols are coming back in. 1911 are coming back in. A lot of 9mm down there, too.

It's a mix of everything, and it's well worth a trip to your local gun shop or your local gunsmith to see what is new and interesting in their store. And I'll bet you, you'll find a way to put something on your wish list for this season.

Pete Brownell
You're going to find old and exciting. That's the stuff that kind of gets me going, Man, I'm going to, continue to come back into that, that store, and contemplate, “is that something I want my in my collection or not?”

You're also going to find a lot of AR-15s that have been personalized. Those are going to be an interesting purchase- the chance to to see just how somebody else has set their AR-15 up.

And there's going to be some unique stuff out there, different colors, pretty interesting.

You're going to have basically the core calibers, 223/5.56, some 300 blackouts that are coming in, too. I find it interesting that a lot of people that have the cash from those guns freed up. That's their spending money to really dive into something interesting and new for themselves. And that is…suppressors.

Pete Brownell
If there is a bright spot in our marketplace right now, it's in suppressors. And it’s driven by the really good work with with Silencer Central and the ASA (American Suppressor Association) helping shorten that that federal application process down to a handful of days.

I remember not that long ago, it was months, like 14 months on the outside; nine months was quick. Now, with the E-form, it's like days, almost point of sale, but definitely in the same week.

Pete Brownell
It's been fantastic for individuals. And you know, we, as a couple of old deaf people, wish this would have happened 30 years ago. I wouldn’t be so deaf from this stuff. It’s a fantastic safety device -much more than a cool factor- it’s a greatsafety factor.

Pete Brownell
Inside the industry, there’s this powder shortage discussion that we're having. How is that going to manifest itself long term?

As far as price, there's two things happening. There is a constraint on powder. So the core brands out there are going to get their powder allocation.

Some of the ones that rely upon excess product may not be around, or may not have enough powder to really blow it out the doors.

So there's, there's a constraint in powder. And it’s the raw good stuff, the nitrocellulose. Because it’s the same stuff that's going into the mortar rounds that are that are being sent and overseas.

So if it goes boom, it requires nitrocellulose. The conventional weapons require nitrocellulose. We need to refill our our stores and our military and also our partners, and that's eating up a lot of that excess, if not the primary powder out there.

There is a powder company coming online down in Oklahoma, but that's a three-year projection. So there's going to be this constraint for three years.

So the main companies, they have their powder allocation. But it may not be enough to really continue their growth strategies. So that's going to require a price increase. So we're expecting a price increase. We always have it.

We think it's going to be significant. Nitrocellulose has like tripled in price in a very short period of time. That's hard to digest for a factory, and some of those factories are public, and they're gonna, they're gonna pass that through all the way to the customer.

I don't want to cause panic…however, it’s the future I do think we’re facing. In 2019 and 2021, you couldn't get shotgun shells. You couldn't have a season, right?

Take this with a grain of salt…because I sell ammo, but I'm I'm putting that stuff I'd rather have a little more than I would use away - just in case. Because I hated not going to the range or reloading. If I'm reloading right now, I want to make sure I have enough primers, have enough enough powder, the core powder that's coming out of Hodgdon, and in the IMR, of course, IMR powders all going to Israel right now.

So there are constraints out there. It’s better to have a little extra than to have a lot less on your shelf. Y I'd be looking at that stuff right now,

Pete Brownell
You do. So your core stuff, 223/5.56, 9mm, 45, that stuff is really going great. That’s because the machines that are set up to run it are running great deals. They’re a great cash generator. May not be a great profit generator right now, but it's a great cash generator, right?

So those, those machines kind of make a factory, or they break a factory. Right now, there are good brand mixes out there. They’re doing a great job, and they’re generating lot of pricing incentives.

Pete Brownell
Traditionally, what happens when we see a slowdown or a price compression, is a trade off. You've got the high volume powder again. If the constraint is going to be powder, and that powder can be used to generate enough cash and profit in the core brand or the core calibers, you're not going to get the specialties.

If that slows down, you're going to start to see specialty lines and become more plentiful.

So .308, 30-06 are coming into stock now because it's hunting season.

12 gage shotgun shells are almost always in stock, because you really run from your trap and skeet and sporting clays seasons. It continues down south into the hunting rounds, the bird rounds and the duck rounds coming soon. It'll be a little bit of shift in shotshells, but not in the not in the on the shelf you'll see that. And I think the core brands are gonna do great.

Pete Brownell
Exactly. There's a season for deal making and to discounts and deals on ammo. That season is coming to an end. So the “price-offs” for ammo and the “hazardous fees waived” - that stuff’s coming to an end. If you see one of those deals, grab it.

We're slowing down on ours, because we're starting to adjust our ammo in stock status as well.

The factories are also adjusting it as well. It's a pull through seasonal project for the whole industry. This is traditionally, when it happens, at the end of August.

Used to be, we'd go back and see “how much of what's on the shelf?” If there was a bunch, there'd be a discount. If there wasn't, there'd be no discount. We know that now digitally. The whole industry can do that digitally, right?

Everybody's really adjusted their inventories in these broader categories to be ready for the season. There's definitely a seasonality to firearms, ammo, optics,

Pete Brownell
You're asking a guy who has one spring for an old LC Smith…

Pete Brownell
Right now the inventory is just adjusting. So my read would be, the slow products are firearms that are about to be “life-cycled” out of the system. When you get some “new 2.0” or “new 3.0” versions, the old versions don’t sell well. Everyone’s waiting for the new one.

We have an industry history of saying “hey, something new is coming” and that kills the current product already in stock. so my history would be, I always call it recent scars of having too much of a product, and I would say firearms that are just about ready to be life cycled out of the system. So you got some new two point zeros or 3.0 versions. The old versions aren't selling well because everybody's waiting for the new one. And we've got a an industry history of saying, hey, something new is coming.

But I can say, ask me next month, I'll give you a different answer.

Pete Brownell
I'll start with like a baseline, and then step into different scenarios. I think the baseline is we will all know who's president, whoever that might be.

Our industry has an assumption that at least I’ll know what I'm dealing with. Then we have baselines for our spending. I know what my policies are going to be. I know I should expect certain things. I know what my income is likely to be now.

Because if it’s Trump, it’s going one way economically.

If the world’s still in conflict, people have a different opinion about where Kamala may take us.

Right now, Kamala’s running to the center right now -to try and get the independents. But will she stay there on firearms policy? Maybe; maybe not. But she’s going to be left of Trump, whatever her policies might be.

So here's what's interesting: when, when Trump was president, the economy was great. People had money. But they weren’t spending it on firearms.

So if Trump becomes president, the assumption is it'll be just like last time. The economy will turn one way or the other. People that are looking at that and betting on Trump, are saying it's going to be better for the individual to have more money to spend… but they're not threatened with having their firearms taken away or ownership rights compromised.

So the AR -15 or the semi-automatic rifle would been a targeted category. The Democrats were going after those. But they really tanked because there was no threat of losing access when Trump came in.

If Kamala gets in, she’s left of the Trump positions. People may say, you know, I want to by that AR-15 or that semiautomatic shotgun or this pistol.

Pete Brownell
Just because I may not have access to that in the future.

There were some companies that bet on Clinton last time. And with Clinton not around, they were ‘way over inventoried. There's a big there's a big industry economic memory about betting on the wrong candidate.

It's better to bet on the slump than to try to maximize your return by having a whole bunch of stuff in stock, and then have the assumption be wrong.

Pete Brownell
That's something else during this overstock spot or slump that we're having as a whole industry right now. Since the pandemic, the whole industry's balance sheet has been stressed. Because product’s beensitting on the shelves and and waiting to get through. It’s mostly turned now, but that’s going to be weighing heavily on our buying com January 1, 2025 - and really, the next four years.

The larger impacts going forward are going to be world conflict. That gets people a little anxious locally as well. World conflict is now at our front door - not necessarily the battle itself - but the social conflict on support of one side or the other.

We have a very split or country right now. We're talking about Israel, not so much about about the Russia/Ukraineconflict. But we have an Israel conflict, and that's at our that's at our college campuses, and that's in our cities as well.

That conflict locally, based on a national event, is going to have more of an impact on the market than a President's response. It’s more than a little bit complicated today.

Pete Brownell  
No, but there’s a lot to think about today.