Maggie’s Question for small business owners.

[tomcatfan]

Everyone is aware that ammo availability and prices are both crazy right now. Many have complained about price gouging. My question is, when your stock is almost non existent, and you don’t know when your next resupply is coming, wouldn’t you have to raise prices to weather the storm?

I don’t know for a fact, but I imagine the shelves at a place like Powder Valley are empty. I can’t imagine they necessarily prefer that set up. Wouldn’t that make business difficult? Sure it’s good when your moving inventor, but what happens when the inventory is gone?

 

[Animal357]

Retail prices have tripled. Who is increasing the prices?

Have manufacturing costs tripled and are they charging triple? Are wholesalers charging triple?

 

[tomcatfan]

Retail prices have tripled. Who is increasing the prices?

Have manufacturing costs tripled and are they charging triple? Are wholesalers charging triple?

Great question. Commodity prices have gone up too. Copper and lead is more expensive.

So maybe it’s premature to start bashing the end guy selling when we don’t know who in the process is increasing prices and by how much.

 

[grinnergetter]

Other stuff that have substantial cost increases coming. Paint, pvc, copper, shortages on thinners/solvents. Personally, prices do not rise before the costs increases come. Simply maintain margin is the goal.
Fill rates for orders in retail hardware land are 70ish percent and currently warehouse orders from vendors are filling at less than 30%. This will be a serious problem for everyone shortly. It's not just the firearm industry for sure.
Short term, buy while you can.

 

[101stinfantry]

I've said it before, when you make a living selling product X, and you can't get it= no money coming in, but the light bill keeps rolling in. So when you do get product you're going to have to mark it up, so you can keep the lights on. Hard to make a living selling something you can't get.

 

[DarnYankeeUSMC]

Manufacturing is the same as it always is. Is it in the distribution? Or is it just being bought as it hits the shelf?
I will say that it's the latter. Instead of the stores stocking it on the shelves waiting to sell it. It's being bought immediately.

Everyone is aware that ammo availability and prices are both crazy right now. Many have complained about price gouging. My question is, when your stock is almost non existent, and you don’t know when your next resupply is coming, wouldn’t you have to raise prices to weather the storm?

I don’t know for a fact, but I imagine the shelves at a place like Powder Valley are empty. I can’t imagine they necessarily prefer that set up. Wouldn’t that make business difficult? Sure it’s good when your moving inventor, but what happens when the inventory is gone?

 

[theLBC]

i don't think the answer is the same for every business and we need more details in every case.

simplified, if a store usually sells 100 apples a month for dollar each, and now can only get 2 apples to sell each month, does he need to charge $50 each in order to keep his same income and cover his expenses?
is he selling more bananas and peaches because more people come in looking for apples?
did he actually get 100 apples to sell, but the first customer bought them all and is selling them for $3?

i saw a list of ammo available from a distributor and they had pretty much everything and the prices, while higher than normal, were not like the increases on the retail side.

 

[SugarBooger]

construction prices are skyrocketing as well. 2x4's and steel are getting more and more expensive with longer leads.

everything is goin' up

sucks

 

[theLBC]

construction prices are skyrocketing as well. 2x4's and steel are getting more and more expensive with longer leads.

everything is goin' up

sucks

unfortunately, energy prices going up affects almost everything, but some thing much more.

 

[DarnYankeeUSMC]

Businesses have a high and a low inventory.
They average selling 100 units quarter but they only order when their inventory hits 40 in stock because the average lead time for delivery will have their inventory back to 100 before they are out of stock. The distributor does the same as does the manufacturer.
When demand is doubled or more it screws the system.
Supply and demand with minimal on hand inventory. Inventory costs money.
That's the bottom line

 

[cattleman99]

There seems to be a fine line between price gouging and staying in business. A LGS near me started legitimately price gouging ($12/50 rounds of 9mm to $38/50) in April of 2020. They claimed their cost increased significantly, which I know for a fact is not true.

Prices have since went up, and ammo seems to be even hard to get. So to answer your question, yes prices will likely need to be increased (albeit slightly) in order to stay in business, but if a business price gouges, it won’t be forgotten.

The last gun show we worked showed the true colors of a lot of local businesses. I felt like a price gouger listing my primers at $70/1000 , but then another vendor bought them before the show even started and sold them for $350/1000. I’ll be sure not to buy anything from them in the future.

 

[DarnYankeeUSMC]

It's no different today than what it was like before the 08 crash.
And Yes we are on the brink of 08 again. Except this time we are already $30 trillion in dept and they aren't going to be able to bail out the "Too Big To Fail" again.

 

[vinniedelpino]

It's no different today than what it was like before the 08 crash.
And Yes we are on the brink of 08 again. Except this time we are already $30 trillion in dept and they aren't going to be able to bail out the "Too Big To Fail" again.

They'll continue with the bailouts. The debt service is only ~5% of the federal budget last time I checked. Look at Japan's GDP vs national debt. They blow us out of the water.

On another note... I've knocked out a couple hundred tax returns so far this season and on average, income is up from 2019. This is across 49/50 states. Keep in mind taxable income doesn't include EIDL grants, forgiven PPP loans and stimulus payments....

It's all bullshit. A giant, steaming pile of bullshit. We didn't need this stimulus... it's just a tool to buy votes at the expense of future generations, and my money says we'll see this nonsense again soon. I've been shitting on boomers for years for being the most selfish generation this country has ever seen. It crushes me that my generation is just as bad, if not worse.

 

[theLBC]

There seems to be a fine line between price gouging and staying in business. A LGS near me started legitimately price gouging ($12/50 rounds of 9mm to $38/50) in April of 2020. They claimed their cost increased significantly, which I know for a fact is not true.

Prices have since went up, and ammo seems to be even hard to get. So to answer your question, yes prices will likely need to be increased (albeit slightly) in order to stay in business, but if a business price gouges, it won’t be forgotten.

The last gun show we worked showed the true colors of a lot of local businesses. I felt like a price gouger listing my primers at $70/1000 , but then another vendor bought them before the show even started and sold them for $350/1000. I’ll be sure not to buy anything from them in the future.

geez. i'd pay somebody $14/hr just to stand at their booth and tell everyone what scheisters they were.

 

[JbBooks]

Businesses have a high and a low inventory.
They average selling 100 units quarter but they only order when their inventory hits 40 in stock because the average lead time for delivery will have their inventory back to 100 before they are out of stock. The distributor does the same as does the manufacturer.
When demand is doubled or more it screws the system.
Supply and demand with minimal on hand inventory. Inventory costs money.
That's the bottom line

This.
We have ordered, received and sold more ammo in the last 5 months than the previous 12 months, as I’ve said in multiple other threads, there is no “shortage” of ammo, just an “excess” of buyers, I’m not even gonna say supply and demand, because this is a whole different animal, here’s an example: my wife called me from the store today while I was on a location and said she just refused a sale today because a guy came in trying to buy a shitload of ammo for guns he doesn’t even have, she asked him what kind of xyz do you shoot and he said he doesn’t even have these calibers, but he’s just buying all the ammo he can and it doesn’t matter the caliber, so she said I’m sorry I can’t sell you this, she explained to him that we have legitimate customers that actually shoot these calibers and we’re still gonna have to be in business when you realize you don’t need to buy every box of ammo you find. And yes I know the name of the game is sales when you’re in a retail business, but these are still our neighbors and yes inventory will return..... Someday.