Marketing

1. Executive Summary

Business is the countries fastest growing innovator, distributor, and marketer of firearms, ammunition, and related products for the hunting, shooting sports, law enforcement, and military markets. Freedom Group sells to a variety of independent retailers and retail chains whose goal is to stock the latest and greatest products from the variety of manufacturers from whom we buy. We support over 1000 such independent retailers' customers and are planning to invite them to our location for the first annual Freedom Group Distributor Hunting & Shooting Sports Trade Show. Due to the fact that our manufacturers expect us to purchase products early in the year so that they may forecast production for the year, we plan to organize this show early in the upcoming year, thus soliciting early orders from our independent retailers. In turn, we can forecast our needs for the year and order appropriately form our manufacturers. A major challenge in effectively soliciting retailer orders far in advance of the selling season (fall) faces us in the show planning process. In addition, it is our goal to encourage retailers to take product throughout the year thus limiting the amount of time we have to warehouse products ordered from our manufacturers. Continued turns of inventory is the best way for us to make continued profits on fairly low margin items.

An initial evaluation of the processes used in competitor wholesaler's trade shows and an evaluation of our best marketing, sales, and distribution processes served as the first step in the organization of this show. Our plan is to extend a VIP invite to our existing core of customers inclusive of a half day meeting session in which manufacturer technical advisors explain their new products for the upcoming year. In addition to that, these customers will have the opportunity to meet with the Freedom Group President and Vice President discussing current practices and potential new practices that will aid independent retailer's growth curve. This will be done to strengthen relationships with our current customers. To attract new customers we have incentivized our current sales representatives with a $20 dollar spiff for every customer they successfully set-up, via an initial order. This plan thus promotes current customer solidification and focuses on the Freedom Group Distributor growth strategies.

II. Environmental Analysis

Freedom Group Distributors was initially opened as an independent retailer of shooting sports equipment. As business advanced via catalog and door-to-door sales, Freedom Group renounced their business as an independent retailer to become a distributor of such shooting sports products in 2004. Liberty Freedom, owner of Freedom Group, was the original buyer of the Freedom Group Retailers, a chain of 3 retail locations in Missouri. She felt that the experiences and strengths of Freedom Group as a retail location, and their network of sales representatives would allow them to support other independent retailers at a rate that could not be surpassed by current distributors. Experiences Liberty has had with distributors, as a buyer, at that time gave her insight into how her sales staff network could do a better job. Current wholesalers are unable deliver products in a timely manner, customer service is poor due to the telemarketing practices executed by current distributors, and customer relationships were fairly non-existent due to lack of face-to-face customer contacts. Liberty has grown her satellite location sales representative network to three times its original size and now has 50 reps calling on all 50 states. Liberty's husband Allata Freedom is the current corporate buyer and manages vast amount of products entering and leaving the facility.

A. The Marketing Environment

1. Competitive Forces. The competition in the shooting sports distributor business is very strong due to the amount of distribution chains with multiple locations allowing them the ability to buy in huge volumes and distribute product throughout their warehouse network. Manufacturers therefore offer these distribution chains extra incentives to buy very early in the year, thus allowing the manufacturer to pre-sell products not yet manufactured. The distributors can then hold the product in their warehouses until independent retailers are ready to purchase. These distributors are able to advertise low prices at their trade show, but service is very limited.

In the current marketing environment, the tactical segment has grown exponentially. Some distributors are able to sell police and military equipment, but not all. Freedom Group Distributors was recently named a Law Enforcement distributor by one of the largest manufacturers of LE equipment. However, two other distributors have the ability to sell these police and military products of competitor manufacturers. Also growing at an enormous rate is ammunition sales. Very near Freedom Group Distributors headquarters are three of the largest manufacturers of component bullets. Therefore, shipping costs are minimal and in-stock rates are very high. Freedom Group Distributors is the number one customer of these manufacturers. Thus, Freedom Group Distributors holds 40 percent of the component bullet market share and is the go to source for retailers selling component bullets.

2. Political Forces. With the recent election of the Democratic party, consumers are reminded of legislation enforced by a former Democratic party leader Bill Clinton. 1997 brought about the Assault Weapons Ban and an increase of tax rates placed on shooting sports equipment. If threats to reestablish this as policy are reinforced, many of the LE products Freedom Group Distributors was granted the right to sell by a large manufacturer will be illegal.

3. Economic Forces. The United States is currently in a state of recession limiting the open-to-buy dollars independent retailers have. On the other end of the spectrum, the recent Presidential election has inspired many consumers to purchase products ultimately used in home defense. Also, increased tax threats on shooting sports products have caused people to feel they need to "stock-up" on goods. This has resulted in a mixture of record sales in some categories and significant lows in others. That being said, the enormous growth in this "tactical" market has overwhelmed the lows in other categories thus resulting in tremendous profits for Freedom Group. Therefore, Freedom Group Distributors will have the ability to use economic resources in promotion some stagnant categories thus inspiring growth.

4. Legal and Regulatory Forces. Year 1997 brought