October 4, 2018
From the Counter: Rocky Mountain Shooters Supply
“From the Counter” works to identify and highlight innovative market strategies helping retailers compete more successfully. Lessons learned will be drawn from an array of regions with diverse market economies. This month, we focus on an independent retailer in the rapidly growing western mountain region 60 miles north of Denver.
Rocky Mountain Shooters Supply, Fort Collins, Colorado
With just over 20 years in northern Colorado, this retailer sits at the base of the Front Range in a brick-and-mortar Fort Collins location, right off Interstate 25. The shop keeps five full-time employees, including a gunsmith, and three part-time employees busy. Keeping more than 50 safes and 1,500 firearms in stock, the firearms inventory is a mix of handguns and MSRs, with an emphasis on hunting and distance bolt rifles, along with a variety of specialty accessories and optics.
That robust retail center, along with seven 25-yard indoor shooting lanes and an offsite 1,000-yard outdoor range located 30 miles away, this retailer serves as a destination for local and out-of-state hunters seeking big game in northern Colorado and southern Wyoming. It services a wide range of customers from tourists and guided big-game clients to the local populace seeking self-defense firearms.
Betting on Politics for Expansion
Starting as a simple, one-room, family-owned shop in the mid-’90s, Rocky Mountain Shooters Supply changed to new ownership in 2005. This transition occurred while the political landscape for the firearms industry was heading in a new direction.
“This store already had a dedicated clientele. When our [current] owner purchased it, we were optimistic, because we knew there was so much opportunity for growth,” said Tony Duda, Buyer/Manager.
With the 2008 elections heating up, Rocky Mountain Shooters Supply decided to invest in a major expansion.
“We didn’t just increase the scope of the store and our inventory. We added an indoor shooting range and developed an offsite outdoor rifle range,” said Duda.
Going for Distance
Like many retailers during the election months leading up to the Obama years, this store received an education in the critical importance of high-traffic sales management and inventory control.
“It was an amazing run. The decade taught us to be nimble and organized. Yet, realistically, we knew turning 50 sales in an afternoon just couldn’t last,” Duda said.
Evolution at this store since then has come in many forms. As customer demographics changed, the shop sold far more handguns, while MSRs became the volume rifle of choice.
As the indoor range helped make customer decisions quickly, the outdoor range began to focus on long-distance shooting, advancing its capacity from 200 yards to 1,000 yards.
Perfecting the Niche
The store pivoted and changed alongside it, but while sales across the board heated up, so did the competition. The “Big Two” surrounded this shop. In addition, other medium and large retailers jumped in the mix to build quality indoor ranges.
“It was clear that if we wanted to remain competitive, we had to start offering products clients couldn’t find in a Sunday advertising flyer,” said Duda. “Our focus shifted quickly. We went to better quality rifles, and we developed a place to develop distance skills. This combination gave us a distinct advantage over our larger competitors,” he said.
Whether it was a bolt gun or an MSR, distance shooting was the clearly becoming the next big for this company’s clients. In response, Rocky Mountain sharpened its focus on rifles capable of a minute-of-angle performance. If the gun was custom made, even better.
“We wanted guns that shot well, were deliverable to our store within a reasonable amount of time and were products we could find profit in,” Duda said.
The minute-of-angle component added a flurry of accessory purchases to the mix and, not unsurprisingly, optics led the list.
“We improved our choice of scopes, number of SKUs, and our customers followed every step of the way. Our clients expect to pay as much or more for their optics as they do for their guns, Duda said, though he also noted that “Over the years, there seems to be two kinds of customers. There are the ones who spare no expense, and the ones who want to get into the distance game on a budget.”
Over the last two years, he has seen the budget distance firearm become much more obtainable. “We now have rifle and optic packages that can get a shooter to hear the metal clang at 1,000 yards for close to $2,000. Even at these prices, we still see strong profits, and the customers often add a second rifle,” he said.
Recalibrating to the New Normal
Today, handguns are still in the volume driver’s seat at this retailer. However, the long-rifle holds the high end of profits for this store.
“Make no mistake, there was profit in the political upheaval. We made a resolute decision that we would not gouge our customers. We just respected them too much to take advantage of them,” said Duda.
While 2016’s pre-election buying storm was about unit sales, 2018 finds this store counting fewer turns but with stronger profits, Duda said, explaining, “The best part of this sales mix is we are making more while fostering new kinds of shooters and shooting that we love,” he said.
Lessons Learned from the Counter
- Replacing the Panic Customer with the Strategic Customer — It’s a juggling act. Classic long-term business strategies will always trump “the run on the store.” Remember, the easy sale will go away, and eventually, you will lose its profitability. Look to the long-term development of your customer base and give them new experiences to promote consistent sales.
- Respect Your Customers to Build Loyalty — This retailer did not take advantage of its customers with radical price gouging, even though it could have. Instead, its prices and profits reasonable. In turn, its developed and fostered customer loyalty that drove it to success through the “new normal.”
- Getting the Client On Their Game — It’s easy to talk about going the distance when there are limited places for customers to experience it. Duda recommends cementing relationships with outdoor range owners. Collaborate and create events at their facilities, even if you can’t get your own range as far out as 1,000 yards. By feeding the shooter demand, you will create success.