Ammo Shortage, JIT inventory systems, and taxes

[AZRedhawk44]

A good point. Also, with metal prices rising, making it now instead of later might payoff, considering the ammo may actually be appreciating in the warehouse, and not depreciating.

Also, the more ammo there is out there, the more gets used.

Used ammo is good for the gun marketplace.

Ammo priced at usable levels has people shooting ammo more often.  This means higher product turnover rates, greater population saturation with regards to your product, more new shooters, more institutionalization of your product as a common household item.

[Scout26]

Also, the more ammo there is out there, the more gets used.

Used ammo is good for the gun marketplace.

Ammo priced at usable levels has people shooting ammo more often.  This means higher product turnover rates, greater population saturation with regards to your product, more new shooters, more institutionalization of your product as a common household item.

Bull Cookies, Unicorn farts and Fairy Dust.

No, it didn't.  FOR YEARS ammo usage rates we fairly predictable.   I take it you never saw a couple layers of dust on ammo boxes taht had been sitting on shelves for extended periods. 

Demand has driven up the prices of the raw materials.  So what you refer to as "priced at usable levels" is a loss to the manufacturers.  Just putting more ammo out there does *not* spur demand.  Look at AR's now as compared to 5 months ago. Demand has sub-sided and prices have dropped dramatically.

Why don't you quit showing your ass about stuff you obviously know nothing about.  Especially supply and demand (basic economics) and supply chain management.  You don't like it.  Go start your own ammo company and sell it cheaper then what it costs to produce.  Maybe then you can make it up with volume.

[lupinus]

Don't get me wrong, there is a balance to be had between having sufficient stock on hand but no so much that it's for no good reason or to the point stuff is expiring before people buy it. Or seasonal product being warehoused when it's not the right season.

My issue with JIT is that it's damned easy for things to fall out of place, especially when you have schizophrenic buyers and VP's. And remove all coordination and flexibility from the supply chain.

And Lupinus, probably the reason you get the e-mails is i would guess it comes from 10% of the store managers, the ones that don't know how figure their stocking levels for various items, and constantly either under order or don't maintain what they should.

Kind of. Except it isn't the store managers, an ever increasing amount of the store inventory is being corporate micro managed. Our issues are largely buyer and VP level.

[Brad Johnson]

Don't get me wrong, there is a balance to be had between having sufficient stock on hand but no so much that it's for no good reason or to the point stuff is expiring before people buy it. Or seasonal product being warehoused when it's not the right season.

My issue with JIT is that it's damned easy for things to fall out of place, especially when you have schizophrenic buyers and VP's. And remove all coordination and flexibility from the supply chain.Kind of. Except it isn't the store managers, an ever increasing amount of the store inventory is being corporate micro managed. Our issues are largely buyer and VP level.

Sounds like the problem isn't the model, it's the people who don't know how to properly manage it.  I'd be a good hamburger the headaches would be just as many and as common no matter what supply chain model was used.

Brad

[lupinus]

Sounds like the problem isn't the model, it's the people who don't know how to properly manage it.  I'd be a good hamburger the headaches would be just as many and as common no matter what supply chain model was used.

Brad

True. But some models are more forgiving of corporate idiocy than others.

[Brad Johnson]

True. But some models are more forgiving of corporate idiocy than others.

Agreed.  There are more forgiving models which tend to be less management-dependent.  The trade-off is they also tend to be less profitable in the long-term net sense.  Just depends on which one you (or your shareholders, if that's the case) are willing to live with.

Brad

[charby]

Also the retail market has gone from specialized stores (such as corner hardware store) to stores that carry a lot more stuff (Home Depot). JIT works well with the megastore chains that can buy in volume.

[Balog]

Are you talking about your own posts, or Brad's? You haven't exactly been taking the high road in this discussion, so I have to ask.

I was going to write out a scathing retort, but you're probably right. I've been under a lot of stress lately and my general dislike for certain folks is showing in ways it probably shouldn't. So, my point still stands but I'll accept my part as well.


As for JIT, it creates many many points of failure and is highly sensitive to mistakes at any point along the long chain. It reminds me of those studies that determine how poor customer service can be before it drives off enough consumers to offset the reduction in manpower expenses. Or the "how many wrongful deaths settlements can we pay out before it's more expensive than recalling this flawed product" studies.

[Gewehr98]

Couple things...

1.  Let's keep it civil in here, ok?  There's a lot of posteriors showing, and that ain't good for the forum.

2.  As a former precision CNC machine shop quality guru, JIT was a godsend.  We didn't have a lot of warehouse space, and didn't need to leave our 24 CNC horizontal and vertical machines always set up for just one widget.

Brad's list of business reasons for JIT ring true.  There are many more I could rattle off, including drawing revisions, quality issues, etc.

Here's the deal: AZRH44's got sand in the folds because he can't get the ammo he wants, right now. 

(Subtle Hint)  That ain't Remchester's fault.  They're all squirting out ammo to the best of their abilities, feeding a huge black hole located (for now) in the center of the American consumer universe.

You show up at 7:30 AM at Wally World's Sporting Goods section, trip or otherwise incapacitate the couple other folks thinking they're gonna intercept the stock boy, and take your chances on what's offloaded from the truck so you can buy your 3 allowed boxes. 

You repeat this dance every week because people are still panic buying and hoarding, and it's been how long since Aurora and Sandy Hook?  An anti-gun president and legislators don't help that situation much at all.

Big warehouses full of product just sitting there are definitely a thing of the past.  Buy something on Amazon, and more than likely that item will go from the manufacturer to your home, bypassing the warehouse middleman.

Consumers will be the ones who stockpile, and of course, they already are.  I know I read the obituaries for people I know with stuff I could get from the estate.  A lot of my ammo, guns, and components came from there already.  Divorce sales are good, too.   

[charby]

Natchez has a boat load of .223 on sale.

[Levant]

Not true at all about amazon. They have huge regional warehouses and some of the most sophisticated processes and systems in the world.  JIT works for somethings but not so much for broad spectrum retail; it's just too hard to predict with the level of accuracy required for  JIT. ( darned auto-correct.)

Sent from my SAMSUNG-SGH-I727 using Tapatalk 2

[Gewehr98]

That's why I said "more than likely" - since a goodly amount of the items I've ordered were shipped directly, per my invoices...

[roo_ster]

Yep, amazon figures since it is going to have to pay state sales taxes, might as well make a stab at next/same day delivery.

[Levant]

That's why I said "more than likely" - since a goodly amount of the items I've ordered were shipped directly, per my invoices...

Nope.  Not more than likely.  Way less than likely.  Not only does Amazon warehouse their own inventory, they are in the B2B business of warehousing the inventory for Amazon Marketplace sellers as well.

Where JIT works great is in providing lots of identical parts to manufacturing where the part supplier specializes in a few items or types of items so completely that they are more efficient at building/procuring/sourcing those parts than the ultimate manufacturer can be - since the manuacturer's business is, for instance, making cars, not piston rings.  In that way, I mean with the very specialized and efficient part maker, everyone focuses on what they do best.  Without this specialization efficiency the manufacturer of the car may as well make all of the parts.  

And it is this specialization that Amazon's business model is lacking from a JIT perspective.  But there is specialization in Amazon.  Their specialization is, in fact, warehousing and shipping.  I buy from Amazon because I can get anything I want, just about, shipped free in two days.  The reason I deal with Amazon is their warehousing and shipping specialization.

Now, back to ammunition.  I don't know if it was in this thread or even in this forum that I posted it (and I'm not going to search it out) but I posted a link to an analysis on a gun blog that was very interesting.  If you take the ammunition production levels before Obama became president, there's one box of .22LR ammo for each 8 gun owners in America.  In normal years, that has been plenty.  All that is needed for a shortage like we have today is for one of 7 gun owners to look to buy a box of .22LR ammunition and there would be a backorder of more than 10 million boxes.

As for JIT and ammunition, those who are crying about shortages are an example of the risks of JIT.  If one step of the chain breaks down your spot in the chain is left short.  But it's not the chain's fault.  If you chose to buy ammunition JIT then you chose to be in the spot you're in today (and I mean the generic you, not any specific individual in or out of this thread).

If you (same generic you) decided you could not live with the shortages JIT could bring, and you chose to create your own warehouse space (cabinets in the garage?) and to warehouse your own materials, rejecting the JIT model for ammunition supplies, then you would not be feeling the effects of this shortage very significantly.

Personal choices... Wanted a gun but put it off until Obama made you realize you need to get one now or maybe never and now you need ammunition for it.  You had your guns but only a small amount of ammunition now you want/need more.  You have 100,000 rounds but you'd like to have 250,000.  All personal choices over which supply and demand left you in the lurch.

[Gewehr98]

Choices are what they are.

I can't handload rimfire.  Everything else I've been making on my own since the mid-1970s. 

It doesn't help if the hoarders do the same to components, though.   

[brimic]

Yep, amazon figures since it is going to have to pay state sales taxes, might as well make a stab at next/same day delivery.

I heard on the radio this morning that Jeff Bezos has changed his stance on sales taxes and now supports them. Reason? Amazon/Bezos has designed a tax collection service which will aid other retailers by collecting the proper taxes for them. 

[zahc]

No surprise there; it follows the pattern of all government regulation that is "supported by business". As soon/long as business finds an angle that benefits them by discouraging competition or something, all of a sudden the regulation is supported and even helpfully extended and maintained by business.

[brimic]

No surprise there; it follows the pattern of all government regulation that is "supported by business". As soon/long as business finds an angle that benefits them by discouraging competition or something, all of a sudden the regulation is supported and even helpfully extended and maintained by business.

Yep. Exactly why GE was a HUGE supporter of Obamacare- they provide the record keeping system.

[tokugawa]

No surprise there; it follows the pattern of all government regulation that is "supported by business". As soon/long as business finds an angle that benefits them by discouraging competition or something, all of a sudden the regulation is supported and even helpfully extended and maintained by business.

 Since amazon is expanding their warehousing and have a presence in states where they now have to collect sales tax, they now seek to impose a tax on all others. So that the Mom and Pop internet sales companies don't have an "unfair" advantage. 
 PS- it is sort of an axiom these days whenever one hears the word "unfair", it is a dead giveaway someone is about to be screwed.

[Scout26]

The market responds:

Remington breaks ground for ammo facility expansion

Remington Arms broke ground this week for the expansion of its Lonoke, AR, operations. The expanded Remington Ammunition Plant is projected to be in operation by the second quarter of 2014. Speaking at the event alongside Remington officials were Senator Mark Pryor (D-AR) and Governor Mike Beebe (D-AR). The Remington expansion will help meet consumer demand for quality ammunition at a time when many sportsmen and gun owners are struggling to find supply. Further, it will stimulate both the state and local economy. "This groundbreaking ceremony marks a significant event for Remington and for the Lonoke community," said George Kollitides, Chief Executive Officer of Remington. "It demonstrates our commitment to state-of-the-art facilities, ensuring quality, increasing product availability and improving on-time delivery to our customers. The expansion also allows us the opportunity to provide job growth within a community that has supported us since we laid the first cornerstone here in 1969."

So when we will see "AZR44 ammo" hit the market?