Who Owns the Supply Chain?

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BillCA

New member
The recent shortages of both certain models of guns and a lot of ammo started me to thinking. Who owns the supply chain?

What got me thinking was the idea of some wealthy leftist billionarie (e.g. George Soros) working with others of a like mind to create an "investment company" to buy out privately held gun companies (Springfield, Knight's, etc.) and then run them into the ground. That's the worst-case viewpoint.

Just as bad, perhaps, is a large investment company that owns one or more gun companies who's CEO and/or board changes over time and they strangle the gun businesses by restricting its cash flow.

So I started out researching a little bit, just to get an idea of what companies own gun/ammo makers and what else do they own? What I found isn't too surprising but it is interesting to see.

http://i241.photobucket.com/albums/ff111/BillCA/Hobby/misc/ArmsOwnership.jpg
Click on the image to enlarge.

I'll have to revise this chart so that it isn't an eye-test. :eek:

Any comments or tips as to who owns what companies or "holding" companies would be appreciated.
 
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B.L.E.

New member
I don't think there is any sort of conspiracy behind this. People are just buying up ammo faster than the factories can crank it out. It's like a classic run on a bank, once it starts, it takes on a life of its own.
The rumor of a shortage creates a wave of panic buying and the panic buying creates a shortage which reinforces the rumor of a shortage which begets even more panic buying.

I predict that this panic buying bubble will pop someday and then the stores will be full of ammo at a deep discount because nobody is buying it anymore because everybody already bought all the ammo they will shoot in this lifetime.

I have seen this before with other commodities, namely automobile antifreeze.
 
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BillCA

New member
I can see how you got this idea...

I don't think there is any sort of conspiracy behind this.
Click to expand...

That was not my intent. I don't think there is any conspiracy either. Most of the companies today are publicly traded stocks in some form or another. If stockholders don't make the returns they want, they have a disconcerting habit of firing CEOs and board members.

This chart is really just about who own's the gun companies and how they relate to other businesses.
 
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BlueTrain

New member
I didn't think any billionaires were leftists. But the previous poster has it correct. It is people panicing, to a degree, and wanting to hoard, whatever the commodity might be. That's why there is rationing sometimes, in order that whoever the government thinks should have something, usually the armed forces, can actually have it. In times of war, everything is scarce and it seems to happen overnight.

But as to your original thought, there isn't that much money. What sometimes happens when companies get bought out is that the principals of the company that got bought out go out and start another business, generally like the one they were in. It happens in banking all the time. In fact, you will have the strange sensation of dealing with the same people all the time, just with different banks.

There is also the theory that companies will try to drive others out of business. To an extent you might say that's true but usually companies do a good enough job putting themselves out of business. Mostly it is a case of bad decisions that can't be blamed on other companies. There is also the case, sometimes true in the firearms manufacturing business, where a company will be selling most of its output to a single retailer. You think of Wal-Mart these days but 50 years ago it was Sears. The retailer then gets to call the shots, so to speak. Most manufacturers avoid that trap but distribution of the product is critical. That's why you read comments on this board about certain things being hard to find sometimes.

I am afraid that we firearms enthusiasts overestimate our capacity to soak up an unlimited production of guns, especially of a few models that we think everyone wants. In the meantime we will buy any and all surplus guns that the Europeans care to dump on us, all manufacturered at least 50 years ago. How many people here have a Yugo Mauser, a Mosin-Nagant rifle, a K-31, etc, etc. No American manufacturer benefits from that habit and then they have trouble selling finely made Winchester lever actions, large frame S&W revolvers, Colt anything and so on.

You realise it isn't that simple. There's more to it than that.
 
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Double Naught Spy

New member
This chart is really just about who own's the gun companies and how they relate to other businesses.
Click to expand...

Right, and what the chart shows is that it is not a supply chain, but supply chains where each major company is its own chain. The "shortage" (or maybe, "demand") is across the board, not along just one chain or another.
 
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lowbud

New member
I have seen this before with other commodities, namely automobile antifreeze.
Click to expand...

HA! I remember this. I worked in a parts store 15 years ago and the owner would fill the basement with anti-freeze every year. Were talkin pallet after pallet. It was nutz!
 
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Re4mer

New member
Thanks for the chart. I agree with some of the other who said that this ammo shortage is not a conspiracy against gun owners. I think it really is a combination of several different factors that have combined to create shortages. 1) Steel and other prices have gone up. 2) Many people are hording because they fear the anti-gun/ammo laws of the new administration. 3) Many new buyers are entering the market lately.

I imagine #3 may be the biggest reason. CCW class enrollments have jumped since Obama took office. These new shooters are obviously buying ammo too so I think prices are going up as many new people get into shooting.
 
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ZeSpectre

New member
Let's just look at the numbers.

We regularly hear that NICS checks have increased dramatically.
In real numbers that seems to come out to something like 400,000 gun sales per month. Now let's just say some of that is "repeat buying" and cut that number in half. We're still left with 200,000 gun sales per month. Multiplied by three months and we're looking at 600,000 potential new gun owners.

Let's just estimate for a minute that each of those gun owners also decided to "stock up" on ammo and bought around 1k rounds for each gun. 1k rounds x 600k guns = 600,000,000 rounds of ammo snapped up more or less all at the same time.

That's SIX HUNDRED, MILLION, ROUNDS! and that is just the "newbies", it doesn't even count the rest of us long time gunnies.

There's no conspiracy going on, that's just an insane amount of purchasing going on. Add in the serious stockpilers and the rest of the already existing shooting community and we're talking ammo sales in the BILLIONS OF ROUNDS purchased in just a few months!

All the ammo production capacity in the world couldn't keep up with that.
 
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Russ5924

New member
And when no one could find any ammo to buy they all decided to start reloading, and the same thing happened. So no ammo and no reloading components:mad:
 
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bubbaturbo

New member
Let's just look at the numbers.
Click to expand...

Or for 400,00 sales per month and let's assume none are repeats so for 3 months that's 1,200,000 new gun owners and let's assume they each bought 1 million rounds of ammo each to stock up.

That's 1,200,000,000,000 rounds.

There's the problem right there.The newbies are gettin' all the ammo:)
All the ammo production capacity in the world couldn't keep up with that.
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Aint "statistics" great?:)
 
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sholling

New member
I didn't think any billionaires were leftists.
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I don't want to get to political here but you have this wrong. About half are to one degree or another. George Soros and Warren Buffet come to mind.

But the previous poster has it correct. It is people panicing, to a degree, and wanting to hoard, whatever the commodity might be.
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For the most part I agree but there is still room for manipulation in the same way that GE's NBC/MSNBC manipulates the news to curry favor with certain politicians who out of respect for board rules will remain nameless. ATK is highly dependent on government contracts as is Olin and Beretta. Cerberus, the owner of Chrysler, is in a position where it needs to curry favor in order to rake in billions more in free money from uncle sugar. ATK has been reducing employee headcount in ammo production as the shortages have grown.
 
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BillCA

New member
Double Naught Spy said:
Right, and what the chart shows is that it is not a supply chain, but supply chains where each major company is its own chain. The "shortage" (or maybe, "demand") is across the board, not along just one chain or another.
Click to expand...

You're correct about the supply chain being missing. Otherwise I would have included ownership of major distributors of firearms and ammunition. That's a much harder task (and requires access to databases that cost money!).

I'm not claiming or attempting to claim that there is a conspiracy of any sort. It was simply an attempt to "picture" some of the relationships in the industry. For example, if you want an AR-15, three of the commercial manufactuers are owned by the same holding company (Remington, Bushmaster and DPMS).

It also gives us a good idea of who to contact when companies make stupid decisions or bow to government pressure. This gets our message in front of the serious decision makers in a corporation.
 
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BillCA

New member
New shooters aren't really the source of the ammo shortages, IMO. New shooters will typically buy between 100 and 250 rounds of ammo at the time they purchase the gun. That's still between 25M to 100M rounds in a fairly short period of time.

Add to that the existing ownership base getting nervous and buying 1,000 rounds at a time and they sucked the supply chain dry.

If folks who already have 1,000 to 2,000 rounds of ammo or more for a particular caliber would lay off buying ammo for a few months (and/or lighten their shooting schedule) we'd see ammo starting to show up on shelves in about six months.
 
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