357,
I expect that you know all of the standard tricks, .003 off the lands, necksizing, etc. I had a buddy that bought an Encore that was a cow pie.... four inch groups. We finally got it down to 1.5 inches but that was it. I finally told him to go buy a 700. Sounds like you might have a 700 with a problem.
I build 700 based custom guns, so lets start with a short list:
1)Check the muzzle to make sure it is not dinged in any way. Cut 3 or 4 narrow strips of credt card. Remove the barreled action. Place the strips into the stock recoil lug slot and tighten the action screws, starting with the rear screw first. This should free float the barrel. Check with a dollar bill. See if the free float helps any.
Gun new in box? If not, strip the bore, plug chamber and fill with Shooter Choice, sit in corner for 1 week.
Action beded? No, Glass bed the action, 100% front to back.
Barrel free floated? No, freefloat the barrel with the glass bedding job.
Now with a solid action, freefloated barrel and brite steel bore you are ready.
The 7-08 should shoot with the following load which is not a hot load: 34 gr of 748 with a 150 Sierra MK. This is my standard test load for a 7-08. The gun should shoot .5 to .75 at 100.
Ed
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