Christopher Merritt explains how this centuries-old firearms manufacturer is promoting a lifestyle, not a brand.

Up until about 10 years ago, firearm manufacturer Beretta USA could trace its history back 300 years to Northern Italy, but in the mid 1990s, historians unearthed a document that would put that conception to rest. An order from the Venetian government for gun barrels was dated 1526, making Beretta the oldest industrialized company in the world.

Christopher Merritt

Giving lean a shot
Last year, Beretta USA began implementing lean principles at its Accokeek, Md.-based manufacturing facility, starting with its Neos line, a 22-caliber pistol. The biggest change was the introduction of just-in-time manufacturing, which has dramatically reduced inventory levels. Merritt explained that, in the past, the marketing department would predict sales for the coming month, and the company would manufacture enough products to meet those expectations. “The problem was, we built up a lot of unnecessary inventory, and sometimes even the wrong inventory.”

Just-in-time manufacturing also allows Beretta USA to adjust to fluctuations in demand, especially in its sporting products lines, which ebb and flow with the seasons. “We might have a month when we need 2,000 of a particular product, but the next month, because hunting season has ended, we only need 200. We can flex much easier now,” Merritt said. Beretta USA is currently exploring the possibilities of introducing lean processes to its line of M-9 pistol. “We are ironing out the kinks in our supply chain as we speak.”

In the meantime, Beretta USA has rearranged its manufacturing floor to allow for a smoother manufacturing process, and in the past four years it has installed approximately $10 million in new manufacturing equipment. The majority of the equipment, Merritt added, performs multiple functions. “We have one of the most modern facilities in the firearms industry.”

Target markets
When Merritt joined Berretta USA five years ago from Orvis, he wanted to change the way the company presented itself to consumers. “We don’t just manufacture a product and push it out the door. Our brand represents much more than that.”

In October, Beretta USA announced Project Allegiance, a program to support law enforcement officials and their families. As of December 1, 2007, Beretta will offer active-duty law enforcement officers who purchase a Beretta Px4 Storm pistol a three-year, $10,000 death benefit at no cost. “The VP of our Law Enforcement and Department of Defense division, Elio Oliva, realized that law enforcement officers purchase our products to protect our rights, and we needed to find a way to give back,” said Merritt.

About three years ago, Beretta introduced Total Solutions System to benefit its law enforcement and military customers. Merritt explained that law enforcement and military agencies require a variety of weapons, from concealed hand guns to shot guns to non-lethal crowd control products, but they needed to cherry pick from a variety of manufacturers and/or distributors. As one of the few firearms manufacturers to offer such a wide array of products, Beretta had an advantage. It created a collection of products geared to law enforcement and military needs, creating a one-stop shop.

“We’d walk into a sheriff’s office to sell a pistol only to learn that they just purchased pistols and won’t need a new inventory for another five years. At that point, the door is closed. We wanted to take a different approach, allowing these customers access to a variety of products under one umbrella,” said Merritt, adding that the St. Louis, Mo.; Albany, NY; and Jefferson Parrish, La. police departments and the Georgia State Patrol have hopped on the bandwagon, and more are expected to follow.

Triggering sales
Merritt also wanted to change the way Beretta approached its recreational customers. “Our brand isn’t just about a quality product; it is about lifestyle,” he said. For starters, about three years ago the company segmented its customers into categories (big game hunters, competition shooters, water foul hunters, upland bird shooters, etc.) and began pushing a shop-in-shop concept.
Merritt explained that Beretta has 750 dealers around the country, the majority of which are small businesses selling a variety of sporting goods. These dealers dedicate a portion of their square footage to Beretta products, and Beretta works closely with them to ensure they are attracting the right customers at the right time of year.

“Let’s take a store in upstate New York where upland shooting is popular. We might dedicate 60% of our inventory in that store to the upland shooter, 20% to the water foul shooter, and 20% to the sports shooter,” said Merritt, adding that Beretta provides dealers with store fixtures, suggestions on décor and set-up, and a list of products each should have in stock according to the target audience. The shop-in-shop concept also promotes clothing and accessories, once again creating a one-stop shop. “The marketing effort here is to transition from just getting product out the door to creating solutions for our customers.”

Beretta also has high-end stores on Madison Avenue in New York and Highland Park Village in Dallas. Those stores, as well as a catalog launched about three years ago, create a venue for customers to experience the Beretta lifestyle. As the company tracks catalog sales and market demand, it is considering opening up more high-end stores across the country.

With a wide variety of firearms, accessories, and clothing in its repertoire, Merritt decided to put a spin on Beretta’s mass marketing efforts. Previously, the company only advertised in industry publications, but today, television constitutes 50% of its marketing budget. In fact, sportsmen use Beretta firearms and wear the Beretta logo on seven of the 10 most popular industry shows. “We actually have our own TV show called ‘World of Beretta,’ which is in the top five,” said Merritt. “All in all, the Beretta name is reaching 6 million to 7 million viewers each week.”