Normally, QA Outdoors reaches out to C-suite leaders and industry figures outside or normal circle of acquaintances for their unique insights. Today, we reach into our circle of industry contacts. Pete Brownell, CEO of Brownells, is contributing a series of features  to The Outdoor Wire Digital Network that offer us glimpses of industry happenings and suggestions we can utilize to improve our businesses in this period of economic uncertainty. Today, Q&A Outdoors drills deeper into Pete’s assertion that we need to think beyond the idea of creating a solid value proposition to create a values proposition with our customers.

Q&A Outdoors conversation with Pete Brownell.

Pete Brownell
Well, Brownells has been around 85 years. We’ve seen trends fluctuate from peaks to troughs and back to peaks. This cycle is bit different. Through the pandemic we had what I’d call a “triple up”: we had scarcity, we had personal concerns, we had a huge financial number sent to people from the government.

That put money in all our pockets and helped create all that demand.

Now, we have what I would call a triple-down or triple-trough. That’s pulling everything back below the mean of an industry that’s been growing over the last 6-7 years.

This triple down is fraught with change.

New entrants coming into the marketplace drove demand. So did the idea in the minds of consumers that things were going to be scarce.

Now, none of that’s there. None of that’s driving any market segment or giving any tailwinds at all.

We’re also facing these new tariffs. It’s an unbelievable shift in the way we have foreign policy going on right now. Things are hard to predict, because no president in my grandpa’s lifetime, or my dad’s - or my lifetime - has addressed foreign policy the way this administration has with tariffs.

That's really been causing a lot of confusion.

And that’s the background to why I believe this market is values - plural - driven. It’s important thing to understand what’s different from a historic trend.

Historically, we’d see 18 months of pandemic, and we’d see 36-months of sales decline and then we’d be back to “normal.” New products, new accessories, new editorial content would reinvigorate people to get back into the sport.

This one's different.

This is where you really gotta be focusing on the value you’re providing to customers. And it’s not just quality product that will drive it.

Quality relationships are also driving it. You’re reputation is gonna be the one thing that will pull you through this slump, this getting back to normal or whatever you call it, as a retailer. The essence of my piece is trying to help the industry understand that reputation will drive you through this downturn. Focus on your relationships you have with your customers, and do it right now.

Pete Brownell
Yes, yes.

Pete Brownell
Well, that's almost it's almost like a “prisoner's dilemma” - the first one to break is the person that gets the reward. Then we’ll all follow. It's gonna be hard to drive value to the customer without playing a little bit of the price game.

Customers right now, not just Brownells customers, but across the entire wholesale business are struggling with fatigue. Stores are struggling with it, and “the deal” isn’t getting it done.

Customers don’t trust “the deal” because there will be another deal tomorrow.

There’s a lot of truth to that…and we’ve done it to ourselves.

So, why are people crossing the threshold of a retail store or entering your URL into the in Google?

They're not doing it because of product…they can find product everywhere. They're doing it because they want to be affiliated with something greater than themselves. They want to be part of the tribe or part of the club. They only get that when they cross the threshold of your store because you’re providing a relationship. They can buy “stuff” from me, they can buy from anybody. But they’ll come to your store and come back if you’re providing a relationship. That name recognition, that inspiration, the education, the familiar approach they get is a whole lot more a part of their buying than just getting a new widget and sticking it on their AR.

You’ll have to provide something greater.

Pete Brownell
They are.

That’s feeding this idea that “it’ll always be on the shelf and will always be cheap, so I can throw it away.” The one-time use for one-season products is gone.

They’re gone due to tariffs- regardless of whatever is negotiated out of the executive branch with Trump.

In China, for example it's still gonna be 30 % which is greater than it was. The “always present and always on the shelf” model — that's gone.

Pete Brownell
That's exactly right.

Pete Brownell
No, it's not the app. The underpinnings of this industry have always predominately been U-S made products. Products that meant quality. That meant legacy. You had companies that stood behind their brands in the USA. That meant something.

Then there were cheap products that came into the country. When that happened, they forced U-S companies to pick one of two methods: it’s either going to be volume sales and cheap, or it’s going to be quality, but not as broadly distributed.

With tariffs, that price differential is is disappearing. But that quality gap is still there.

Now, customers are looking at the purchase thinking “is this something that’s going to be around? Is this something I can hand down or use multiple times?”

It’s that motivation to buy quality that’s important to understand.

Pete Brownell
That's that's a fantastic question. We're gonna find out.

We're also gonna find out where things really come from. If the prices increases or stay’s pretty consistent you’ll know. I’ll use your euphemism of glass.

Leupold is a US-made product. You take a look at some other companies out there and their tubes are coming from overseas. They got a big fat margin they're cutting and because of that, they’ll sell volume. They're picking price and volume to drive their brand reputation.

Leupold is going to stick to their guns. It’s a great example of U-S made products that will be consistently performing throughout.

The “rush to value” in this article - and maybe this is a little spoiler - it's really not about the rush to value. It’s the rush to values, plural not singular.

Values are driving the market right now. In times like this what do we value the most? It’s not cheap; it’s quality. It’s U-S made. It’s reputation.

When I’m selling stuff to a customer, am I selling a cheap product? Or am I selling something that always gonna work -that I’ll back for the life of the product -which will usually outlast the life of the buyer?

Those things count.

They always count when we have escalating prices, the devaluation of the dollar or some macroeconomic things in play.

These values are significant and we need to change our attitude toward what customers really value because they're they're being very selective right now.

That’s one way of saying they’re being tight with their dollars.

They’re uncertain what’s in their economic future. So, they’re choosing that if they’re going to spend a bit more money they’re buying an item that’s gonna last a lot longer.

Pete Brownell
Well,I'll use a great example. There's a long-standing MidwayUSA/Brownells battle.

We kind of sell the same stuff. But there are areas where we’re really good and areas where they’re good. There’s space for everybody.

What what does your brand stand for? What does your value proposition to that customer stand for?

We (Brownells) are in the builders space - everybody who wants to build a firearm. They could come here and find everything they need to complete that firearm and that maintenance space - for any firearm.

So if you're creating a brand you have to lean into your brand. Really stand for that. Sure,I’ll take any order that comes across the threshold -but we have to stay focused in on what we’re really good at? You build your personal reputation, your business reputation, that way.

If you wanna be a competitive shooting store and known for that, take the orders that comes in through the door, but you should really dominate in that competitive shooter space.

If you’re a shotgun store, create the support space for scholastic targets. If you’re a hunting store, lean into hunting. There’s room for all of you to actually compete and cooperate together in the market space to build the overall community of gu owners in your geographic area.

That’s good for both of you. If you get into some zero-sum game, you’re going to end up on the wrong end of the anvil.

Pete Brownell
Not always. But plenty of plenty of times we've had a customer call in with all kinds of questions that really aren't relevant to who and where we are as a company. We know everybody in this industry, and we’ve told them, “you might fit better with PSA (Palmetto State Armory), or you might fit better with Marty Daniels direct (Daniel Defense) for the kind of things you’re looking for. There’s room for everybody in a market like this.

I’ll use a boating term to explain why: you got to raft - get together- to get through the waves. Out there trying to paddle by yourself, you're gonna hit some rough spots. Who's gonna pull you through? The people you’ve rafted up. Sometimes, that's a competitor.

Pete Brownell
Yes, right. We're gonna be holding hands and skipping through this thing (laughing). That ain't happened.

But we need to hang on tight and work together. That’s everybody - even the consumer and supply chain. Tariffs are increasing pricing and scaring the hell out of out of consumers.

How do we make it through this this tough patch? By working together as partners. With you, your competitors, a partner in your supply chain, and a really strong partnership with your customers. Then we’re really building a community of gun owners.