Gun Industry Faces Decreased Growth
By Oregon Tax News
As industry revenue levels recede this year, potential for modest growth in gun and ammunition sales through 2015 may still exist. The National Rifle Association (NRA) held its annual meeting in May in Charlotte, North Carolina. The general theme outlined the decline in gun sales despite the recent trend of ‘friendliness’ toward gun owners.
Gun and ammunition sales grew 8.9 percent in 2009 to $10.4 billion, reports research firm IBISWorld. Although, a good portion of that growth came from huge military ammunition buys to supply troops in Iraq and Afghanistan. However, many NRA activists argue that the recent surge in gun and ammunition sales reflect consumer fear that the Obama administration would restrict sales. This year, the anxiety over gun control is easing, and industry will experience a 5.7 percent revenue decline according to IBISWorld, a national research firm.
Despite the recent decline in growth of gun and ammunition sales, IBISWorld analyst Nima Samadi predicts the industry will still grow at an annual rate of 3.7 percent from 2011 to 2015. The growth is down from an estimated annual pace of 6.9 percent for the five-year period ending December 31, 2010.
The Securities and Exchange Council (SEC) produced documents illustrating the net sales for the three months ended March 31, 2010 were $94.7 million, a decrease of $26.3 million, or 21.7%, as compared to the three months ended March 31, 2009. Centerfire rifle sales decreased by $24.2 million, or 27.8%, as compared to the prior-year period, primarily due to reduced sales demand for modern sporting products [assault rifles]. Shotgun sales decreased by $1.2 million, or 4.9%, as compared to the prior-year period. Rimfire rifle sales decreased by $1.0 million, or 14.4%, as compared to the prior-year period.
Although the decline in growth of gun and ammunition sales continues, the industry is thankful that it continues to grow despite the current recession.