How Will ECONOMY Affect Knife Prices?

[Dag-nabit]

Like many I'm already having to think twice about making high end purchases.

I suspect with the tight economy sales will slow overall, with high dollar knives taking the biggest hit, lower cost offerings, with decent quality, will probably continue to sell reasonably well because they will remain an affordable indulgence.

Price is affected by supply and demand, so if demand is low for a long enough period, cost of materials should drop, and so will cost of manufacture.

Right now the market is full of product produced at a higher production cost, so it will likely be awhile before we see any significant accross the board price drop.

Any short term price reduction is probably coming directly off the profit margin of the local reseller as they sale price items to move inventory.

Kevin

 

[Peter Parker]

http://www.campaignforliberty.com/

 

[Fred Sanford]

Well I can only speak for myself but I think sales WILL go down which should mean that prices should go down if demand is down.

Thankfully I have NO debt other than my house, and I have a good job. However, even though I can still afford to buy knives, I am not. I am stashing that money away for other things just to be safe.

If other people do the same thing as me, I would imagine that knife sales are going to go way down. So unless a company has a death wish their prices need to go down also or they need to lay off people.

 

[mnyshrpknvs]

I think if I were going to start dealing in knives, I would focus on customs. Lower priced to hi-end. Reasoning for this decision is because of market saturation and businesses wanting to be the lowest price around, many production dealers will not be able to make enough money to survive in a slowing to halting economy. The margins are just not there in these products to do well, even if you have every production brand under the sun.

If you make connections with some real good up and comers and also some solid makers that have years under their belt, you can make better margins. You are also going to have more people looking for specific makers with money willing to spend it. If you add to that a diverse product selection like Glass(scopes,binocs),vests, sharpeners and magazines(clips) I think you may have a much better chance of pulling through this grim time.

There will always be a demand for the high end because the people that can spend $1000+ on a folder typically are not effected by these times. They use their stock losses as right-offs and like the fact things are selling for less now. The wealthy-rich and the people getting Government Assistance really are not effected to much at all with extremes.

 

[akadave2]

i have seen like a 2-3% jump already.
tangent ---- ruger 1022s have jumped $40 :jerkit:

The icrease in the price of guns is a direct result of Obama becoming president not any kind of economic process. Ive spokent to many gun owners and frequently visit many gun shops. There is a lot of information on the web as well about this.

 

[gamma_nyc]

I predict that prices will have to come down. Inventories are too large and raw material prices have dropped drastically since last year. On top of that there is a war winding down (less demand for tactical?).

Economically, we've just had the largest contraction in nominal GDP in the past 26 years and home prices have not yet stabilized (new home sales were down 16% MoM in December). As bonus season passes with widespread disappointment i believe that there is probably another leg down in the economy, or at least in the stock market. To the OP's point about increasing money supply and inflation, i suggest that there will not be any inflation until we have had "reflation", or a growth of prices after the current "deflation" of prices cycle is over. Another way of seeing this is by looking at the actual availability of cash and collateral in the corporate market place - major brokerages have literally 30% of the collateral availability for lending that they had just one year ago. Just one of these large banks has had enough collateral decay to require the entire TARP funds program just for itself...not to mention the many other banks out there who also need funds. Deleveraging and deflation are very dangerous and difficult to stop.

Everywhere you look there are discretionary retail "sales" going on. 30-50% is not uncommon. What makes knives different? I feel that if I have ANY money to spend, i am going to be darn sure that i get the biggest bang for the buck. Whether that is on a new knife, new refrigerator, car, TV, etc. I maintain that perceived discount is a major necessity for sales to continue.

With the huge markups available in knife prices I would anticipate more sales and less new models in the near future.