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Under the gun: What manufacturers should do to halt illegal gun trafficking

by Mary Hamann, Director of Communications, Mendoza College of Business

May 1, 2006


Every year in the United States, more than 300,000 violent crimes are committed with firearms.

Nearly 30,000 people die from gun violence.

And guns account for an additional 80,000 nonfatal injuries.

Recently, Marketing Professor Kevin Bradford looked at how criminals get their guns. In the paper Countermarketing in the Courts: The Case of Marketing Channels and Firearms Diversion, Bradford and co-authors Gregory Gundlach and William Wilkie, Notre Dame’s Nathe Professor of Marketing, examine the ways guns move from legal channels into the hands of criminals.

Their research reveals how marketers can implement countermarketing strategies to discourage demand from—and sales to—unwanted customers. The authors also recommend a framework of safeguards that firearms manufacturers and distributors can implement to prevent illegal gun diversion in six major distribution channels.

“The industry could do more to embrace safeguards,” says Bradford. “If (gun manufacturers and distributors) have an opportunity to market their products very aggressively, then they have the opportunity to countermarket them as well.”

Managing Dealer Networks

Of the six channels outlined in the study, Bradford says that most guns used in crime were purchased from either licensed dealers or at gun shows.

“A high percentage of crime guns are new guns,” Bradford explains. “People think that these guns have changed hands many times, but a lot of guns come directly from manufacturer to distributor to dealer to criminals.” Noting that there are more than 100,000 licensed firearms dealers in the United States, the study recommends ways manufacturers and distributors can better manage their dealer networks. These include

terminating sales to dealers who do not perform mandatory background checks or who do not operate from a retail store (commonly referred to as “basement bandits” or “car trunk dealers”). The study also suggests halting sales to dealers who have known criminal indictments or who have sold a large number of guns later used in crime.

“It’s been estimated that up to 40 percent of the crime guns are supplied by less than 1 percent of the dealers,” reports Bradford. “But they (dealers) are still able to buy guns; there are still manufacturers selling to them.”

Safeguards at Gun Shows

Gun shows are another distribution channel widely linked to sales of guns used in crime, says Bradford. Every year, an estimated 4,000 gun shows are advertised in the United States, and these events are often very loosely organized and regulated. In many states, unlicensed individuals set up tables alongside licensed dealers. These unlicensed dealers are not required

to conduct criminal background checks when they sell guns. While Bradford acknowledges that many unlicensed dealers are hobbyists who mean no harm, he points to statistics from the Bureau of Alcohol, Tobacco, Firearms and Explosives demonstrating that many criminals exploit gun shows to buy and sell firearms.

Recommendations range from requiring mandatory background checks and better inventory control at gun shows to more restrictive measures such as stopping the distribution of firearms to dealers at shows altogether.

An Industry-wide Framework

While a few individual gun manufacturers have put some safeguards in place, Bradford believes that an industry-wide framework of safeguards is needed because of resistance within the industry and the political clout of the National Rifle Association. In 2000 the industry’s largest manufacturer, Smith & Wesson, voluntarily adopted several safeguards in a much publicized agreement with various municipalities and the states of New York and Connecticut. “There was backlash by the industry and many dealers and gun owners wouldn’t buy their products,” says Bradford. “Their profits and sales dropped tremendously.” Not surprisingly, in 2001 the company backed off from the agreement.

As with other products that can cause harm, such as tobacco and fireworks, the courts may prove to be the catalyst for change, says Bradford. He and his colleagues hope that their analysis will inform future judicial deliberations. “We hope the courts will say, ‘Let’s use this framework as a guide,’” adds Bradford.

Looming Court Challenges

Indeed, court challenges loom for the gun industry. Recent congressional legislation that grants gun firms immunity from prosecution for harm caused by firearms used in a crime will almost surely be challenged, says Bradford.

This legislation passed on the heels of several large lawsuits against the gun industry by victims’ families, advocates of gun control, public safety groups, and municipal and state governments. In a notable 2004 suit, the gun dealer who allegedly misplaced the Washington sniper’s assault rifle (along with 238 other guns) agreed to pay eight victims’ families a total of $2.5 million. And, for the first time, the manufacturer agreed to inform dealers of safer sales practices to help prevent other criminals from obtaining guns.

The stakes are high. The estimated economic costs of gun violence in the United States exceed $100 billion annually when related expenses for medical care, criminal justice measures, lost wages and prisons are considered.

“The legal demand for guns is there,” says Bradford, “so gun manufacturers should be willing to embrace these safeguards to keep guns out of criminal hands.”

In forthcoming research, Bradford and colleagues are studying which manufacturers have implemented the proposed safeguards and the effectiveness of each of the safeguards in curbing illegal gun trafficking.

Professor Kevin Bradford specializes in sales management and marketing strategy. His research focuses on the salesperson’s role in building close buyer-seller relationships and the management of distribution channel relationships.

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