business news in context, analysis with attitude

We got a number of emails about the various stories last week focusing on the decisions by various retailers to change their requirements for people who buy guns in their stores.

MNB reader Karen Durfee wrote:

I was in a Dick’s Sporting Goods store last night (Saturday) at 6pm and there was no sign that customers are shying away from the retailer in light of their recent gun sale restrictions.  Saturday night is not exactly a time I would expect to see the store full of shoppers, which was part of the reason I went at that time, but it was.  Glad to see a retailer can take a stand they feel is important and not miss a beat, possibly pick up the beat a bit!

From MNB reader David Spawn:

I applaud your stance and your desire to bring some kind of reasonableness to the discussion.

I was more saddened by a recent piece in Time that suggests the real reason for gun control measures now being suggested by the right is that it will improve the sagging fortunes of gun manufacturers which has resulted in less corporate contributions to the NRA.  This paragraph from the article sheds some light:
It may seem a paradox that gun manufacturers have suffered during the Trump era. Firearms sales are down across the industry: the combined revenues of Sturm, Ruger & Co.; Vista Outdoor; Winchester; Remington and American Outdoor Brands (formerly known as Smith & Wesson) fell 13% in fiscal 2017. FBI background checks, the metric used as a proxy to track sales, fell 8.4% last year from a record-breaking 2016. It was the largest year-over-year drop this century, and some of the world’s largest gunmakers have cut back on production and slashed payrolls as a result. The slide has shown no sign of stopping: two days before the Parkland shooting, Remington declared it would file for Chapter 11 bankruptcy protection after its 2017 sales took a 30% nosedive.
Maybe too cynical is the next step to wonder if the White House has a stock position they are to trying to improve….
PS - There will always be people who refuse to acknowledge nuanced conversations and that ultimately is ok.

From another reader:

I’m fascinated by how far this dialogue will go, but already it seems some of the protests are going too far. A CEO of a major investment company said he’s under pressure to “divest” gun manufacturers—something that’s particularly difficult to do with index funds, when the gun making companies are part of the index. Similarly, the CFO of a credit card company said that it’s under pressure to prohibit use of cards for buying guns—something it has no technical means of policing.

Then there’s the case of FedEx and UPS, which are sparring over their NRA policies. FedEx first refused to end discounts for NRA members, saying it never sets pricing or discounts for groups “in response to their politics, beliefs, or positions on issues.” Then, when the heat intensified, it tried to deflect blame, saying “for shipping from its online store, the NRA uses UPS and not FedEx.” UPS countered that it’s just a common carrier, and doesn’t offer discounts to the NRA.

We live in interesting times, to be certain.  The lack of progress by state legislators (where gun licenses are today issued) has caused many to make this a Federal issue.  Society is playing a great role in getting the needed discussion to happen.

And from another:

First off I agree with how you have presented the subject, your commentary I believe was fair and considerate to both sides. With full disclosure I am ardent second amendment supporter and firearms owner.

With that said, I’m not so sure what these large retailers are doing is based on addressing their communities concerns. I believe these decisions are based primarily in protecting their bottom lines, and frankly that is their responsibility. Raising the purchase age to 21 really does not accomplish anything based on current evidence. I also find the age issue somewhat odds with itself as to what we feel 18 years olds are mature enough to handle. It is my opinion these decisions by the retailers are about appearing to make change while really not making any significant change, and in my mind this is disingenuous.
Just my thoughts for whatever their worth, presented in what I hope was a polite and civil manner, which seems to be in short supply these days.

I think the age issue deserves discussion. After all, one can join the military at 17. But one cannot buy a beer until aged 21. Hardly a surprise that the debate can be confusing, because standards are inconsistent.

And from another:

I applaud Kroger/Fred Meyer, Walmart and Dick's for eliminating guns and raising age to 21. More and more companies are responding ethically to the crazed gun shooting issue and about time. Now it's time for Congress to get its collective butts in gear to do likewise. They should also forbid NRA lobbyists, in my opinion.

Another MNB reader wrote:

Heaven help a country where we have to count on Wal-Mart to lead us to the moral high ground.

MNB reader Paul Simonetti wrote:

Wanted to take and let you know that your commentary about the gun sales issue was one of the best comments I have read to date on this issue. Well said , sir.

Thanks. In the end, I think I’m with the kids. But I’m certainly willing to listen, and hope others will do the same.

On the broader subject of companies having to take positions, one MNB reader wrote:

I remember not long ago when CVS pulled the plug on Tobacco, and everyone said while it was good PR it was a bad business decision. They’ve gone on to diversify into more profitable business, added healthier foods items and become the leader in their channel from a social perspective- and that was a $4 Billion Dollar a year revenue loss if I remember correctly?
Michael Jordan was often criticized for not speaking out on social/racial issues and was allegedly quoted saying something along the lines of  “Republicans buy shoes too’- At that time being as apolitical as possible was smart business. I think what some of these examples tell us (and there are countless more) is that era has come to an end. While you can’t place a dollar value on positive PR, it’s simple math that when the general public strongly agrees with something (most people on both sides don’t seem to think anyone needs an AR-15)- it’s smart business (or politics) to let them know you are on their side.

On a less contentious subject - where Amazon’s HQ2 will be - one MNB reader wrote:

Believe it is obvious where Amazon HQ2 will be located, somewhere in the vicinity of Washington DC.  The only force that will slow down Amazon is the US government and Amazon smart enough to not to let that happen or at least slow the process.

I wrote last week:

I’ve always believed that Amazon would choose either a blue or blue-leaning location for HQ2, because that would be the kind of place where it would be easier to attract a diverse workforce.

One MNB reader responded:

Kevin, this is a completely irresponsible thing to say and not true under any stretch of your imagination.

First of all, I don’t think it is irresponsible. I’m just stating my opinion. We’ll see if I’m right.

(Guess this wasn’t as less contentious as I thought…)

And from MNB reader Tim McGuire:

Great to see your perspective that Toronto is still a viable wild-card contender for Amazon’s HQ2. As a proud Canadian retailer based in Toronto I can tell you our city and the greater Toronto region would be excited to welcome Amazon to Canada.

In addition to the LGBTQ-friendly environment your article highlighted, Toronto has two advantages over all the US locations - first, Canada’s universal healthcare system would save Amazon $600 million per year in healthcare costs vs any US city - and that is more valuable over time than even the $7 billion in tax grants New Jersey has offered.

Second, in direct contrast to the Trump government’s restrictions on visas for the highly-skilled immigrants that Amazon and all of Silicon Valley need to fuel their growth, Canada has instituted an accelerated visa process to get qualified candidates a visa in just 2 weeks, because we recognize that every new software engineer who comes to Canada and makes $200,000 per year quickly puts $150,000 of it back into the broader economy. I call the quick-delivery visa process “Canada Prime”. 🙂

KC's View: