Booming Domestic Firearms Market Crushes Exports – EasyExport Insights™ Monthly Analysis

If you want to see what happens to U.S. exports of firearms and related products when the American domestic market is hot, look no further than the table below:

The table compares the 12-month period that ended January 31, 2021, with the two prior 12-month periods. So, for the most part, it compares 2020 with 2019 and 2018.

The five categories shaded in yellow are completely or heavily military and should be ignored for purposes of this analysis.

Of the remaining 17 categories, which primarily include exports to the commercial market:

• Exports decreased in 15 of 17 product categories.
• Exports increased in only two: Autoloading centerfire rifles and spring, air and gas guns.
• In the 15 categories in which exports decreased, exports dropped from $887 million in the 12 months ending January 31, 2019 to $762 million in the corresponding period ending January 31, 2021, a decline of more than 14%.
• In the 7 categories with the largest declines, (see table below) exports dropped by 33% overall, from $441 million to $294 million:

• As noted in the table, the largest decline occurred in ammunition for rifles and pistols, where exports decreased by $63 million, from $224 million in the first period to $161 million in the most recent 12 months.

–  What can we learn from the numbers?

What stories do these numbers tell us . . . other than the obvious one that exports of nearly all U.S. firearm products dropped by a lot – 14% — from the 12 months ending January 2019 to the same period two years later.

Why did exports fall?

Is the global market for U.S. non-military firearms, ammunition and related products shrinking? Happily, it isn’t. If one looks back 10 to 20 years, one sees the same phenomenon. U.S. exports go up and down. Today, we’re looking at a snapshot of a down cycle.

Things will turn around. The U.S. firearms market will cool down, product and management attention will be return to the international market and exports will increase again. It has always been that way.

Why is that good enough? Maybe exports shouldn’t shrink when domestic demand rises. Maybe international sales should keep growing, but at a slower pace, when there is heavy U.S. demand.

But why?. . . . Maybe exports should grow just as much as domestic sales in a hot market . . . . Or more . . . . Why is it a given that exports of firearms, ammunition and related products drop when U.S. demand increases? There is no rule that international sales must be down when U.S. sales are up. No requirement that the international sales manager must lose when their domestic sales counterparts are fighting for allocations of the same scarce inventory. No mandate that the international market must be treated as sub-market of the U.S. market.

–  Opportunity

At EasyExport Insights, we scan the numbers every month looking for opportunity for American exporters.

This is what opportunity looks like. There is no reason to think that exports decreased because demand decreased. Demand didn’t drop. Supply did. The products people wanted to buy weren’t on the shelves to be bought. Therefore, the numbers tell us that more than $100 million in international demand for U.S. products in 2020 went unmet.

It’s very easy to respond to the above by saying, “Same as in the U.S.” But it isn’t the same. The U.S. demand that couldn’t be met in 2020 represented growth from the past. Manufacturers couldn’t keep up with growth. In the global market, in contrast, U.S. suppliers couldn’t even keep up with the demand that was already there. That’s our point.

And there’s the opportunity. The numbers tell us all that it is when U.S. demand is highest that the best opportunities exist for strategic positioning in the global market. Can your company build a long-term international strategy to capitalize on that dynamic?