Firearms Range Retailing - Action Target & Range Retailing. Industry Background Agenda ... Markup Pricing for ... Merchandising Distributors

Presented by:Doug VanderWoude

AcuSport, OnTarget Range Manager

800‐543‐3150 Ext. [email protected]

Firearms & Range Retailing

AgendaIndustry Background

Objective

Components of Success

Conclusion

Industry Background

23 Yrs – Salesperson, buyer, manage advertising and marketing

NSSF Range Committee Member

Charter member of the industry’s first

Performance 20 Group

2003 – Founded Silver Bullet Firearms & Indoor

Range / Training Center

July, 2010 – joined AcuSport to start

Industry’s first range program

Over 30 years experience in the industry

Objective

We will discuss the components of success –Retail/Range/Training.

We will explain why retail is a VERY important component – 60% to 80% of your sales.

80%

15%

5%

Retail Range Training

Objective: to make your business successful


Range and Training

Range TimeRange Time

MembershipsMemberships

ClassesClasses

Facility and Operations

Store BasicsStore Basics

SecuritySecurity

Firearms Operating Procedures


Merchandising

DistributorsDistributors

Benefits of Buying from a Distributor


Inventory Management

Point of Sale Systems


ComplianceCompliance

ReportingReporting

Hire and Train the

Right People

HiringHiring

TrainingTraining

Marketing and Advertising

BrandingBranding

Marketing Tools

Marketing Tools

PromotionsPromotions

Finances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit


Range and Training

Range and Training



ClassesClasses

Facility and OperationsFacility and Operations


SecuritySecurity



MerchandisingMerchandising




Inventory ManagementInventory

Management




ReportingReporting

Hire and Train the

Right People

Hire and Train the

Right People

HiringHiring

TrainingTraining



BrandingBranding

Marketing Tools

Marketing Tools


FinancesFinances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit

Component 1: Range and Training

Range and Training

By the 1/2 hour and hour – range from $8 to $14 per ½ hour to $15 to $22 per hour.

Second shooter half price is normal.

If competitors are by hour, should you have day pass? Should you offer different pricing on weekends? Consider different pricing for bringing own ammo vs. buying in store. Sell or rent eye/ear protection Do they get a target with rental, what kind?

Range Time Pricing Strategy

Range and Training

Memberships Tiered Structure – some go up to $20,000 with very small ownership

percentage.

Membership Rates – usually 15 to 20 range visits – equal cost of membership.

$20 per hour membership, facility charges $300 to $400 annually. Look at monthly with $75 initiation fee, take $400 annual. Becomes $34.99 month plus $75 one time if current on billing. Annual saves roughly $20 every year plus the $75

Range and Training

Punch cards Pay for 5 visits get the 6th one free.

Benefits of Membership Most shoot free at all times. Others with lower member prices

shoot free weekdays. Member card with photo. Some offer discounts on In Stock, Non Sale merchandise and

classes.

Clothing or hat with range/store logo. Lane reservations. Member lounge.

Range and Training

Classes Profit center Hiring instructors

Female instructors Pistol vault

Poster promoting

Closet for materials

Facility / Operations

Range and Training

Range and Training



ClassesClasses

Facility and Operations


SecuritySecurity








Management




ReportingReporting

Hire and Train the

Right People

Hire and Train the

Right People

HiringHiring

TrainingTraining



BrandingBranding

Marketing Tools

Marketing Tools


FinancesFinances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit

Component 2: Facility and Operations


Does name describe your facility

Don’t pigeon hole What will a customer see

as they drive by? Sign shape Wire for electric Clean parking

lot

Store Basics

Facility / Operations Can they see into the store at least

through the front door? Is there a clear path leading where

you want the customer to go? Is there directional signage ? Is store clean and well lit? Fishbone

Hours/Phone/Web

Negative sinage?

Store Basics (cont.)


Alarm with cellular backup Camera’s to phone Lighting in and out Shrubs

Merchandise layout Racks over 5’ to back Cement 38spl or .410 to

shell posts

Security


Industry specific counsel will guide you through the steps to properly set up and start your firearms business. Specialists will educate you on the Law Plus Guidelines and provide rapid response services to keep your business protected. NSSF FFL help for you as well NSSF Lead Management and OSHA Compliance Seminar

Next seminar is Dec 8‐10 in San Diego

Operating Procedures

Merchandising

Range and Training

Range and Training



ClassesClasses



SecuritySecurity



Merchandising





Management




ReportingReporting

Hire and Train the

Right People

Hire and Train the

Right People

HiringHiring

TrainingTraining



BrandingBranding

Marketing Tools

Marketing Tools


FinancesFinances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit

Component 3: Merchandising

Merchandising

You should have accounts with at least 4 or 5 distributors.

The most popular are AcuSport,Sports South, Ellett Brothers and Big Rock.

Distributors

Merchandising

They are your warehouse. They keep a website with live inventory. You can buy on terms.

Get group buying power without any oversight or fees.

AcuSport’s freight charge on orders placed over $500 is $4.50 and sent second day air.

The benefits of buying from a distributor are:

Merchandising

AcuSport CustomerLink Solutions


Range and Training

Range and Training



ClassesClasses



SecuritySecurity











ReportingReporting

Hire and Train the

Right People

Hire and Train the

Right People

HiringHiring

TrainingTraining



BrandingBranding

Marketing Tools

Marketing Tools


FinancesFinances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit

Component 4: Inventory Management


Handle range and class reservations Track time in range Offer electronic sign‐in range forms

Electronic 4473 forms or bound book auto‐fill Automatic monthly membership billing Robust reporting packages Ability to operate on multiple devices


Purchasing an inventory management system will be on of your largest decisions. It is the brains of your operation. Top Systems:


Axis Retail Management System Designed specifically for

shooting ranges with retail stores

Celerant

Cervelle – Merchant Magic

Counter Point

Top Point of Sale Systems


Robust reporting package allows you to measure key performance metrics Daily item sold report Manufacturer or category report Items sold last 60 days with 0 on hand

Information at your finger tips allows you to manage and stay in control of your business

Cycle counting

Reporting


Fully integrated bound book Electronic 4473 process Includes 3310‐4 and 3310‐12 reporting

Real time processing allows for a seamless compliance experience

Easy search and retrieval of transactional data

Compliance

Hire and Train

Range and Training

Range and Training



ClassesClasses



SecuritySecurity








Management




ReportingReporting

Hire and Train the

Right People

HiringHiring

TrainingTraining



BrandingBranding

Marketing Tools

Marketing Tools


FinancesFinances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit

Component 5: Hire and Train the Right People


The Predictive Index® System helps to improve employee selection and retention; assist in coaching and development, and manage talent.

Other tests available Employees are your brand You can’t handle every guest

Hiring


RETAIL sales training is a valuable skill. If someone has sales skills, they can learn the products.

Edge Training provides access to retail sales and customer service training in a train the trainer format.

Sales staff must ask questions Edge Retail Management

Retail management spends lots of time hiring

Training


Range and Training

Range and Training



ClassesClasses



SecuritySecurity








Management




ReportingReporting

Hire and Train the

Right People

Hire and Train the

Right People

HiringHiring

TrainingTraining


BrandingBranding

Marketing Tools

Marketing Tools


FinancesFinances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit

Component 6: Marketing and Advertising

Marketing and Advertising Make sure your web site is informative and has all store information

Pricing saves phone time

Pictures in and out Map to facility Signage should be

highly visible and impactful

Branding

Marketing and Advertising Budget money for marketing

Promote your brand with AdVantage FREE

Signage

Gun tags One page fliers Circulars

Email blasts

Marketing Tools – Get customers in the door!

Signage


Circular Email blast

Flier

Gun Tags


Facebook

Newsletters

Gun owners forums

Gun show raffles Be a firearm expert to the media

Church and Civic groups Bachelor and bachelorette parties Home shows

Other Marketing Tools


Billboards, radio and newspaper

Paid Advertising


Pre Grand opening media event

Radio disc jockey contest Tent sales Grand Opening Customer appreciation,

brand or category events

Promotions

Finances

Range and Training

Range and Training



ClassesClasses



SecuritySecurity








Management




ReportingReporting

Hire and Train the

Right People

Hire and Train the

Right People

HiringHiring

TrainingTraining



BrandingBranding

Marketing Tools

Marketing Tools


Finances

Margin vs. Markup

Margin vs. Markup

Pricing for Profit

Pricing for Profit

Component 7: Finances

Finances

CategoryTypical % of Inventory $

Anticipated Margin

My RecommendationAnticipated

Turns

Handguns 30‐40% 12‐24% Sliding scale 4

Range Ammo

5‐15% 30%30% by box give a discount

for case purchase 6

Shooting Accessories

10‐15% 30‐40% 30‐40% 2

Optics 4‐8% 23‐30% 25 to 30% 2

MININUM Starting Inventory Amount:

$100,000 per 1,000 Ft. of retail space

Finances

Work off margin rather than markup

Margin: Take your cost on a Glock pistol ($440). To make 15% margin, take $440 and divide it by .85 = $517.64 or $519.99

Markup: If you did just markup, take $440 times 15% = $506. Sell at $509.99 Difference of $10 is your missed PROFIT.

Margin vs. Markup

Finances

$200,000 turns of two = $400,000 in sales at cost. If margin was 25% = $533,333 in sales less cost of $400,000 = $133,333 in gross profit.

$200,000 turns of three = $600,000 in sales at cost. If margin was 25% = $800,000 in sales less cost of $600,000 = $200,000 in gross profit.

$66,667 more money to run your business

Turns

Turns is how many times a year you sell through your inventory

Finances

Sliding Scale Pricing for Firearms

This is how the sliding gun margin works, adjust as you see fit in today’s market and more importantly your market. I adjusted for guns that you know people price shop like Remington 870 express and such, but overall it will save you a lot of time answering price questions from your staff.

Handguns

Under $200 divide by .78 22% Margin

$200‐$300 divide by .79 21% Margin





$1000 and up divide by .87 13% Margin

Long Guns (Non AR)Under $200 divide by .8

$200‐$400 divide by .82

$400‐$700 divide by .83

$700‐$800 divide by .84

$800‐$900 divide by .85

$900‐$1000 divide by .87

$1000 and up divide by .88

AR and Other Modern Sporting Rifles$600‐$1000 divide by .78

$1000 and up divide by .8

Finances

Conclusion

Ideal Retail Experience Impacts Profit

Consumer is Aware and Finds Store

Greeting by Well Trained Staff

Listens to and

Assesses Customer Needs

Presents Products

to Address Needs

Sell Initial Products

Upsell Range Time

Sell Accessories

Sell Class

Coupon for Return Range Visit

(position membership)

Increased line items increases profit

Conclusion

Gross blended margin at RETAIL 10% to 28% with most popular being 23% to 26%

Blended margin combined retail/class/range should be 30% to 40% margin

Operating profit of 7% to 12%

Documents

Firearms Range Retailing - Action Target & Range Retailing. Industry Background Agenda ... Markup Pricing for ... Merchandising Distributors