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  1. #1
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    What Companies Do You Know That are Committed to Quality?

    I thought the Remington bankruptcy, due largely to its cheapening of its own product while it was owned by Cerberus, a private equity firm deserved another thread that explains the problem in more detail and asks which companies, especially outdoor companies are committed to quality? It's a shrinking list and I'd truly like to have a list of those companies.

    The thing that killed Remington is widespread and getting worse and here's why.

    The business of Wall St. that buys out companies it feels are making too little profit by the way they are managed falls under what is called private equity. This is the world of Gordon Gecko from the movie Wall Street.

    The way it typically works is that a private equity firm like Cerberus, KKR, Apollo or Blackstone raises a lot of money by promising investors big returns. The sooner they can realize those profits, the more money the buyout fund general partner can raise.

    Here's how they do that on companies that are already trading on the stock exchanges.

    First, they buy enough of the company's stock to get control. Quickly, they pay themselves back by having the company take on debt, often a lot of debt. So they love to buy companies that have been reluctant to take on debt before. Since debt payments increase the company's expenses and lowers profit, they next do what they had planned to "make the company lean," i.e. efficient.

    That means selling off "underperforming" divisions that don't generate much cash, which may be the ones in which management has been investing for future growth. Then they cut costs by laying off employees, by moving production overseas, by lowering the cost of the products in any other way they can, like making the candy bar smaller, replacing metal with plastic, maybe by raising machining tolerances to reject fewer parts. If they cut costs enough, they may even lower prices to get more sales.

    The consumer, not knowing what is going on behind the scenes, loves it. "Man, you mean I get can get a Remington for that price? Cool, I'm buying. What a deal!"

    Because the company has taken on debt, called "leveraging up," when costs start going down because of these "greater efficiencies" and reported quarterly profits start going up and more importantly, beating expectations, the value of the company in Wall Street's eyes goes up because they are more profitable and that profit is increasing. "They really turned that old company around." The private equity firms then sells the shares they bought for a large profit, having "improved" the company. A lot of the profits go to the partners in the buyout fund and they do it all over again.

    That's the worst case. In other cases, they may actually improve truly mismanaged companies. And and a big part of private equity is to buy companies that have not yet issued publicly traded stock like young, innovative tech firms that become the tech giants of tomorrow like Amazon and Facebook. I'm talking about when the firms buy out already publicly traded companies.

    Here's what most people don't know and what concerns me - how much of America they own. Amazon is the 2nd biggest employer in the U.S. with 540,000 employees worldwide. But, buyout firm KKR currently owns companies with total employment of 650,000. The only company to have more is WalMart.

    Buying out companies is now a $1 trillion industry and has become the majority of what private equity firms do as opposed to taking promising companies public. And because it is so profitable, the money keeps pouring in. Apollo just raised the largest pool of money for doing buyouts ever - $25 billion in just one partnership.

    So, expect more products with lowered costs. As a whole, America has turned from how it built it's dominance in industry, by innovation and high quality and narrowed that to one area - technology products. The rest of what we put out is becoming junk.

    What companies can you name that are unflinching in their commitment to quality, especially outdoor companies? What companies do you know that are making exceptional products and are not aggressively raising prices?
    Last edited by hoshour; 02-14-2018 at 06:52 AM.

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  3. #2
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    First I would say Ruger. They have problems with keeping up with production of certain models, but their quality and customer service are tops. There are many smaller companies that are tops too. RCBS, Dillon and Leupold have great product lines, their quality is great and customer service is second to no one.

    I am sure there are many more, but these come to mind first. Dave...your financial background raises to the top again!
    Colorado Cowboy
    Cowboy Action Shooter; Endowment Life Member-NRA, NRA certified Range Safety Officer, Pistol Instructor, Rifle Instructor, RMEF, Boone & Crockett Club.
    The Original Rocket Scientist-Retired
    "My Father always considered a walk in the mountains as the equivalent of church going."
    Aldous Huxley

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  5. #3
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    Quote Originally Posted by Colorado Cowboy View Post
    First I would say Ruger. They have problems with keeping up with production of certain models, but their quality and customer service are tops. There are many smaller companies that are tops too. RCBS, Dillon and Leupold have great product lines, their quality is great and customer service is second to no one.

    I am sure there are many more, but these come to mind first. Dave...your financial background raises to the top again!
    Thanks. After thinking about it, I might make industry exceptions for aircraft, maybe vehicles and certainly for medical products, including pharmaceuticals. That's why the majority of individual stocks I buy are in tech or health care, though I detest the price gouging in drugs today. I just don't buy those companies.
    Last edited by hoshour; 02-14-2018 at 07:31 AM.

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    I would say First Lite and Sitka have both done good jobs with making quality gear and giving back, as well as fighting for conservation, FL especially.

    As for the price increases...haha FL is miles better than Sitka though. Sitka wants 800 f'ing dollars for waders.

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    Great write up.
    I would say RCBS and benchmade knives. I have first hand experience with both. Losing screws and missing parts, both companies just shipped them no questions asked. Plus their products just last!


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    Remington went to hell in a hand basket. 100% managements fault.

    Ruger has proved with their American rifle line that you can create a decent economy rifle. That junk from remington for the same money was awful.

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    there are some few american companies that are committed to quality but the truth is america has become the worlds new "taiwan".
    there are very few products manufactured here today that are still of the quality of 50 years ago.

    appliances are garbage. t.vs are garbage. even house paints suck anymore.
    government regulations are the # 1 cause of this
    AS GOES THE CHURCH, SO GOES THE NATION

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    Browning/Winchester....

    I wish they made Pickup trucks....I would buy one. They are the only mainstream guns that I have had god luck with. Mostly because I'm hard on things.

    I do worry about their diversification. I wish they would make less products and focus on their quality. They have a list of guns that are discontinued a mile long.

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    Quote Originally Posted by mallardsx2 View Post
    Browning/Winchester....

    I wish they made Pickup trucks....I would buy one. They are the only mainstream guns that I have had god luck with. Mostly because I'm hard on things.

    I do worry about their diversification. I wish they would make less products and focus on their quality. They have a list of guns that are discontinued a mile long.
    Browning rifle's have been made in Japan for years by Miroku.

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    I am really impressed by Browning's trail cams. I'm going through and replacing my others with theirs.

    Also, I have to say that I own a Remington 700 given to me as a gift a few years ago and it is very accurate. It is actually the first gun I pull out for deer, antelope or elk. It is also not on the serial # list of those with trigger issues. It's probably 7 years old. So, in my comments about the junk many companies put out today, I didn't mean that was necessarily my opinion of Remington. But, I don't like the influence of buyout companies. In many cases, it has been very detrimental.

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