Read Glock: The Rise of America’s Gun for Free Online Page B

company account in Atlanta, and Walter found a small suburban warehouse-and-office complex in Smyrna. Riedl flew to the States to plot a pricing strategy with Walter. They worked in Walter’s basement, with Walter’s wife, Pam, serving ham sandwiches and coffee.
    The pair settled on a commercial wholesale price for the Glock 17 of $360 and a recommended retail price of $560. These levels undercut comparable American and European brands, yet assumed generous potential profits. According to Riedl, Glock’s gross margins exceeded an astounding 65percent—the manufacturer pocketed $240 on each gun sold. By comparison, manufacturer margins on pistols at companies such as Smith & Wesson and Beretta ranged from 5 percent to 20 percent, according to people in the industry. The Glock’s simpler design and the computerized manufacturing methods allowed for larger profits.
    Gaston Glock at first urged his marketing men to try a lower price to boost demand even further. Walter strongly disagreed. “If you sell it for cheap, you will have the image of a cheap gun,” he told Glock. “Quality will always bring you more money.” Glock deferred to Walter’s experience in the American market. It was a crucial early decision, one that eventually made Gaston Glock a very rich man.
    Riedl drafted an initial sales plan. Under the plan, the company’s gun operation would break even in its first year if it sold 8,500 units. By comparison, S&W and Beretta each sold hundreds of thousands of guns annually. For Glock, the sale of knives, bayonets, and other products, such as machine-gun belts and plastic fragmentation grenades, to the Austrian military provided a revenue cushion for its fledgling firearm business.
    That December, Riedl and Walter traveled to Denver for the annual trade show of the National Association of Sporting Goods Wholesalers. Industry rumors had piqued interest in their gun, even though it wasn’t widely available yet in the United States. The Austrians themselves had only a handful of pistols to display. They borrowed exhibition space from one of the wholesalers with whom Walter was friendly.
    The response was overwhelming. On the very first day of the event, Riedl and Walter logged orders for 20,400 guns—far more than Riedl’s target for the entire first year. It would take months to manufacture and ship that many pistols to theUnited States. “We couldn’t get enough out the door,” said Walter—the sort of predicament any small company would love to have.

    To celebrate their triumphant debut in Denver, Riedl and Walter invited sales representatives to join them that night for free drinks at the bar of a Holiday Inn. The men from Glock arrived in navy blue business suits and ties, as they had dressed for the trade show. The Americans, to their dismay, turned up in cowboy hats, denim jeans, and pointy Western boots. “A little embarrassing,” Riedl admitted.
    The next morning, he and Walter rushed to a Western outfitter to buy Stetsons and the rest of the frontier costume. Feeling prepared, they invited their new colleagues back to the Holiday Inn bar on the second night of the wholesalers’ show. This time, the Austrians came attired like John Wayne in
Stagecoach
. Once again, however, they were confounded—the Americans had switched to business suits.
    It turned out that the previous evening had been a special Western Night at the Holiday Inn—which was why everyone had dressed like a cowpoke. “We had something to learn about the United States,” Riedl said.
    A few weeks later, the Glock team received another lesson in business, American style. During a retailers’ trade show in Dallas, an FBI agent with whom Walter was acquainted asked the salesman what he thought about that morning’s column by Jack Anderson in the
Washington Post
about Gaddafi buying Glocks to distribute to terrorists.
    Walter assumed the gossip was some kind of strange joke. A couple of days later, when he returned to his