Hindsight from The New Gun Week February 1, 1999
Outside Forces Cause Business Changes
by Joseph P. Tartaro
Executive Editor
Sometime between Christmas and New Year's I had to get new batteries installed in my watch and my wife's. This used to be a fairly simple task, but not anymore.
In the past, I've even stopped at Watch World stores in malls, while traveling, or even in drug stores, to get new watch batteries installed.
But things have apparently changed, either because of the normal evolution of business or new state or federal laws-or both. Here's the story, and it isn't all that different from what has happened in the firearms business.
The first place I tried was the most convenient-a Target store we visited to buy other items. I went directly to the jewelry counter, but was told by the clerk that she could not sell or install batteries for watches they did not sell.
A day or so later, on New Year's Eve afternoon, I cruised down several neighborhood shopping streets in different parts of the city where I remembered that there used be several mom and pop jewelry stores. The first such street was still loaded with small specialty shops and other retail operations for some 12 blocks, but not one of them was a jewelry store.
Then I drove north in the city, running the length of two other such popular neighborhood shopping areas. On the second of these, I finally found a little jewelry store with a neon sign saying they were open. But after I parked and approached the entrance, I was able to read the handwritten notice on the door said that the store would be closed for a few days because of a death in the family.
New Knowledge
My next stop was a Kmart store further up the same street. And at the jewelry counter, I got the most useful information from the clerk, even if I didn't get the new batteries.
"I can't install new batteries in watches we don't sell because I'm not a licensed jeweler," she said.
Now, the answer I got earlier at Target made sense.
Asking around, I found out that small jewelers who were being squeezed out of business by larger drug and/or jewelry operations had hoped to stave off the inevitable by helping lobby for a law that limited such watch service to "licensed jewelers," except for products actually sold in a "non-licensed" store.
I had already been musing about the number of gun stores that used to be in many of these same neighborhoods years ago when I was younger. It used to be fun visiting those gun shops-some of which were in neighborhood hardware stores-to look over large selections of used and new guns, talk with knowledgeable clarks, and occasionally make a purchase or do a trade. That was before the Gun Control Act of 1968, and to a lesser degree, for many years afterwards. Shopping for guns, ammunition and related accessories in those stores used to be as easy as having a battery replaced in a watch was 15 years later when we stopped winding our wristwatches.
I realized that the nature of many businesses had changed, and not necessarily for the better. But change is an integral part of our lives and is especially noticeable in the compettive world of business.
I thought about the corners where there used to be so many gas stations that also performed a variety of automotive services, charging or installing batteries, changing burned out lamps or fuses, oils changes, and even brake, muffler and ignition work. On the commercial street a block from my home, we used to be able to walk to seven different gas stations within just a few blocks. And they all made a living in those days.
Since I was also involved in public relations for an old-line manufacturer of automotive service tools, I knew that there were about 250,000 independent gasoline service stations with mechanics in the US about 20 years ago. Today, there are a lot less gas stations, and they don't do service. They are delicatessens where the most help you'll get with a car problem is a finger pointing to a phone where you can call AAA, or a tow truck to a car dealer.
Government/Industry Influence
The big changes in the service station business started taking place when the government, with some oil industry executives in support, passed laws relating to fuel economy and reduced emissions for cars. When the design of cars made them more complex and the cost of computerized equipment to test them, insurance and mechanic training and tools became too expensive, a lot of people dropped out of the gas station business. Others sold convenient food store items, a product line that often produces better profits.
Thinking about changes in the jewelry business while I drove around, and then to the changes in the service station business, brought me back around to the gun business again. That's because the anti-gunners had been trying to drive federally-licensed gun dealers out of business for years by claiming that there were too many gun shops-"more gun dealers than gas stations in America," and that many of the FFLs didn't follow state and local laws.
In the late 1980s and early 1990s there were about 250,000 federally-licensed dealers in the US, about twice as many gun dealers as gas stations at that time, but about as many as there used to be gas stations before that business environment changed. There were also more than 100 gun distributors doing business nationally then. That's not true anymore, for retail dealers or wholesalers.
An aspect of the Brady Act that was passed in late 1993-that took effect immediately while the handgun waiting period didn't start till months later-was that the law also raised fees for new and renewed FFLs and required that applicants demonstrate that they complied with all local and state laws.
The anti-gunners had been seeking the higher fees and local law compliance for years. To some extent, some full-time storefront gun dealers had sought the same changes to reduce competition from what they claimed were "kitchen table bandits."
As a result of those changes there are now about 80,000 federally-licensed dealers-substantially below the number of gas stations/food stores today. Only about 10- to 12,000 are full-time storefront gun shops.
While the higher license fees contributed to some of the reduction, the big factor was the requirement that existing or prospective licensees comply not just with state business and sales tax laws, but with local zoning ordinances. Most of the part-time dealers could not obtain variances to satisfy existing zoning laws, and some anti-gun communities actually interpreted zoning laws more strictly to prevent part-time kitchen table and garage dealers from conducting business at their homes. Curiously, many of those more zealous communities allowed the same people to operate other businesses from the same premises, but singled out gun shops and gunsmiths for extermination.
The part-time dealers never accounted for more than 15% of a retail gun business that thrived off and on for many years. However, the elimination of so many small-volume dealers also eliminated almost 200,000 gun "salesmen" who helped the whole industry by talking guns and accessories with their friends, neighbors, co-workers and fellow club members.
At about the same, adverse publicity and local pressure caused some of the larger chain stores to eliminate handguns, and sometimes all guns, from their inventories.
These combined changes helped cause the gun industry as a whole to take a nose-dive.
Gun Shows Next
A related issue has been pressure by the anti-gunners, with support from some licensed dealers, to eliminate secondary casual sales at gun shows. The anti-gunners would like to eliminate gun shows all together. But they will settle for requiring that all private sales be subjected to a background check, if not a waiting period.
There are also some storefront dealers today that also feel that people selling guns privately at shows occasionally must also be required to go through the same waiting period or federal/state background check that dealer customers at shows must endure. They frequently are the people who tip-off ATF to secondary sales, which leads to the type of letters reported in the story on Page 1 of this issue, and to the proposed legislation to license gun show promoters-also see another Page 1 story-forcing them to conduct background checks for all private sales at shows and send records of all transactions to the ATF.
The climate seems to be ripe for more changes to the gun business in the near future. And, as is so often the case, if the changes come as a result of new legislation, they are unlikely to benefit the business as a whole, gun shows, or an industry that is also being stalked by legal pirates and unscrupulous local politicians.
Oh, by the way, I did get the watch batteries changed. I went to a jewelry store I knew of that also sells appliances and electronic products. Adding product lines and good marketing kept them in business, not legislation. Individual businesses and whole industries must change to survive, and sometimes those changes may produce greater market share and individual business growth.
The New Gun Week is published three times a month by the Second Amendment Foundation (SAF) on the 1st, 10th, and 20th. Hindsight is a commentary written by SAF President and Gun Week Executive Editor Joseph P. Tartaro. This commentary may be reprinted so long as credit is given to the author and the publication. For more information or to subscribe, write Gun Week, PO Box 488, Buffalo, NY 14209, or call 716-885-6408 Monday through Friday 9 a.m. to 5 p.m. EST, or inquire on Compuserve to John Krull, Production manager-JohnSAF@Compuserve.com or gunweeksaf@broadviewnet.net
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