A Shifting Market
Paul Bastean, managing director at Ultimate Defense in St. Peters, Mo., said the ammunition market is shifting for dealers. Larger retailers are getting the ammunition they need, he said, but smaller retailers still are having a difficult time.
“If you have the capacity to buy a pallet, you can get ammo,” he noted. “If you only have the capacity to buy three cases, you don’t get it. If a wholesaler or manufacturer can put a label on 360 cases of ammo and send it to one place, or send 360 cases of ammo to potentially 100 different places with 100 different mailing labels, both for the same amount of markup, they’re going to send it to the one place.”
Because Ultimate Defense has been buying ammo by the pallet, Bastean said they have developed a new and different relationship with other retailers around them.
“We get along with a lot of the local gun shops in our area,” he shared. “We are now their ammunition distributor.”
According to Bastean, ammunition prices are finally starting to come down from what they were during COVID.
“U.S. manufacturers are fighting with importers now, and they’re losing,” he observed. “Importers are driving the price down.”
Bastean thinks this will continue to drive prices down, and if imported ammunition remains as available as it is now, smaller retailers will start to be able to buy lesser quantities of ammo again.
“But it may not happen,” he cautioned. “We’re not in an election cycle yet, but we can kind of see it from where we are, and this election cycle is going to be a doozy.”
Bastean said the imported ammo he’s seen is primarily from Magtech and Sellier & Bellot.
“That’s a lot of what we’re getting offered,” he said. “We’re seeing a lot of it not only from our wholesaler reps but also on emails. It’s also a lot of what my competition is advertising.”
Domestic manufacturers are struggling with price, Bastean observed.
“Winchester just came to us and they’re not even in the realm of being price competitive in 9mm,” he said. “We haven’t had a box of 9mm Winchester in here for two years or so.”
One thing affecting ammunition sales, he contends, is the effect the economy is having on disposable income.
“The guy who’s been a gun guy for more than five years has a cache of ammo he’s sitting on,” he said. “It’s never enough, but it’s at least enough that he feels comfortable he has some. The new shooters we’ve seen in the past two or three years still buy a box here and there, but inflation and disposable income are going to squeeze everything a little bit tighter. We’ve seen a slight reduction in training and memberships and from year to year, we’ve seen a pretty substantial reduction in ammunition sales.”
At one point, Bastean recalled, Ultimate Defense was the only retailer in the county with any ammunition. During that period of time, they saw a massive increase in the amount of ammunition they were selling because they were the only game in town. Then in the middle of 2022, some of the big-box stores started getting ammunition, and the store’s ammo sales decreased.
