Cherrystone wrote:
Well....given their age, I'm gonna assume they didn't look like they were hit with a belt sander, so yeah they do have some numismatic value, folks like to fill the holes in their little blue books. I don't have anything close to a current gray sheet on hand, so I can't guess what that might be.

Personally on a quick turn on collectibles/antiques I'd be happy with 30-50%, depending on the total price, and actual street value.

That said, I didn't have the cost of an entire store in my lap, I only rented space, & paid show fees. Maintaining an entire storefront is expensive.

Do they think people are idiots? Well......look at the nature of the pawn business.

Just checked Coinflation.com.. Rated Fine they're about $6 each. These were at best rated Good.

I understand the store has overhead.. But they're not banking the entire existence of the store on the sale of these 12 coins. In my mind a 1 day 100%+ profit on a single item is pretty damn good!

I might go back again today and try and make a deal. I've dealt with the actual owner on some other coins I bought there and I got them for about the same % over spot that time.

The guy I was dealing with this time was more combative and defensive, than trying to make the sale.

Cherrystone wrote:
Do they think people are idiots? Well......look at the nature of the pawn business.

P.S. I would think that even an idiot who'd be interested in buying these coins knows their asking price is way way out of line!

John Jebbia wrote:
As I mentioned in a thread I posted yesterday, I'm big on collecting silver U.S. coins. I only buy junk silver coins. I have no interest in Numismatic value whatsoever.

Anyways, yesterday afternoon I stopped in a pawn shop on my way home and they had 12 silver quarters in the case.  Nothing special.. Mostly 1964's and a few late '50's. They were priced at $12.95 each - only a moron would pay that when spot price is currently about $4 each.

I checked spot price and came to an amount I'd offer before calling the sales person over.

Conversation went as follows. (paraphrased)

Me: I'm interested in these. Will you take $50 for all 12? (slightly over spot price)

Him: No way. We need at least $125 for all of them.

Me: That's way over spot. Silver is way down!

Him: But they have collector value.

Me: Not really. They're mostly 1964's (8 of the 12)

Him: Well, we're not working for free. We have to make a profit.

Me: Well, I know what you paid for them and what I'm offering doubles your money.

Him: How do you know what we paid for them?

Me: I know that you pay about half spot price because I came in to sell you some a few months ago. (I didn't sell)

Me: I'm offering you double what you paid.

Him: Well, they were pawned 90 days ago and we paid more for them.

Me: I know what they were going for 90 days ago, and even when it was at it's peak, you still paid only about $2.50 each. I'll go to $60 for all of them.

Him: No can do, and walked away.


He also said he just put them out that morning (not sure if that's true or not). He also went back and asked the owner if they could go lower and came back at $100.. still way too high.

Question:
If you were the decision maker, would you rather double your money with a quick sale (assuming they really were put out just that day), or would you rather sit on them and wait for the price to come back up.. which even at it's peak didn't come close to $100 for the lot.

Oh I'm sure you know way more about running a pawn shop than the owners of the pawn shop... 

What's with people!  I get you are frustrated they didn't play the game you wanted to play--that you offered what YOU thought was a good, fair price.  But get over it--they wanted a better price.  The owner probably knows, from experience in the pawn business, that someone will buy them for over $100.  Move on...

When you own a pawn shop you can run it the way YOU want.

Gianantonio wrote:
Oh I'm sure you know way more about running a pawn shop than the owners of the pawn shop... 

What's with people!  I get you are frustrated they didn't play the game you wanted to play--that you offered what YOU thought was a good, fair price.  But get over it--they wanted a better price.  The owner probably knows, from experience in the pawn business, that someone will buy them for over $100.  Move on...

I think he thought he had a sucker.

Gianantonio wrote:
Oh I'm sure you know way more about running a pawn shop than the owners of the pawn shop... 

What's with people!  I get you are frustrated they didn't play the game you wanted to play--that you offered what YOU thought was a good, fair price.  But get over it--they wanted a better price.  The owner probably knows, from experience in the pawn business, that someone will buy them for over $100.  Move on...

John Jebbia wrote:
I think he thought he had a sucker.

Pawn shops survive by purchasing things for ten cents on the dollar and selling it for 110 cents on the dollar.   To answer your question, for what they paid for the stuff to begin with, they can afford to keep it until someone pays the inflated priced.  That is the nature of the business.

Cherrystone wrote:
Do they think people are idiots? Well......look at the nature of the pawn business.

It's a business geared towards the "low information" customer, and likely to frustrate the more intelligent.

Paolo Diavolo wrote:
They're waiting for an idiot to come in and make an emotional buying decision, not a logical decision.

To me, pawn shops are like Craigslist: Something to avoid.

GCobb Photography wrote:
I saw two DVD players in a pawn shop once.  They were identical with different prices.  When I brought it to the attention of the guy there he said I should buy the cheaper one, rather than raising the price.  He said he had more money in the other.

Sounds a lot like a photographer valuing their work based on how much they're spent on gear.

Salater Photography wrote:
I've been a precious metals commodities broker for over twenty years. I get a kick out of people who are stuck on spot price and think that anything charged over that is profit. Not true.

The spot price is based on a contract for a future purchase in the next twelve months, cash purchase, no delivery, and for 'good' bars.

If you're some guy in a pawn shop or calling some dealer, you will always pay more than spot, always. I've been in the business my whole life and I pay more than spot. In fact, the company I work for buys millions of dollars of precious metals at a time and they pay over spot. But people hear on the radio or news "gold is 1460 an ounce today" and think that is the price for their coins or bars and anything charged above that is a markup or ripoff. Not true.

In the story you posted, yes. The shop is charging too much, obviously. And the value of coins is easily verified by going to pcgs.com or checking the coin red book.

If you're interested in buying gold and silver coins, don't go into some pawn shop or small local dealer. You don't even know if what you're buying is real. Go to an established dealer and one who will also buy it back at a reasonable price. I see tons of you 'spot guys' haggle about the price over spot for days and then have no place to sell it years down the line and end up taking pennies on the dollar. Apmex.com is a good place to buy online and they buy back too.

I'm dealing with large institutional buyers now and large IRA's but years ago, I would take calls from people and if they demanded, "What is your markup over spot?" I would just hang up. No use trying to educate them and even if you did, the trades were for small amounts and not worth it.

I definitely understand that I'll pay above spot price and sell below it. My point is, I know what the pawn shop bought them for and it's about 50% of what they're worth. Even if they bought them at silver's high, they paid about $2.50 each. My offer was double the amount they paid.

Call me crazy, but if I'm the owner, a 100% gain on my money, I'm taking it.

rp_photo wrote:

Sounds a lot like a photographer valuing their work based on how much they're spent on gear.

If you can successfully run a business without making money please share the secret...or publish a book and give it away.

John Jebbia wrote:

I definitely understand that I'll pay above spot price and sell below it. My point is, I know what the pawn shop bought them for and it's about 50% of what they're worth. Even if they bought them at silver's high, they paid about $2.50 each. My offer was double the amount they paid.

Call me crazy, but if I'm the owner, a 100% gain on my money, I'm taking it.

"High-information" people like you aren't worth it to them, and I don't see logic and reason winning an argument with a typical pawn shop person. It's kind of like the adage about wrestling with a pig in mud.

GCobb Photography wrote:
If you can successfully run a business without making money please share the secret...or publish a book and give it away.

Say two photographers produce similar work, but one has twice the expenses of the other. How many customers would be willing to pay one twice a much as the other if given a choice?

Or what if a retail store had two identical items side-by-side with one priced twice as much as the other?

KonstantKarma wrote:
It's called "pawn" for a reason.

I'm mostly wondering who they think is going to buy them for their asking price.

John Jebbia wrote:
If a 100% gain on a single item isn't enough to keep a business afloat, even with overhead.. it's not a very sound business.

It's a business much like payday loans or rent-to-own in that it's geared towards fleecing the desperate.

rp_photo wrote:
It's a business much like payday loans or rent-to-own in that it's geared towards fleecing the desperate.

Sure.. but the desperate are the ones selling.. not the ones buying.

Salater Photography wrote:
I've been a precious metals commodities broker for over twenty years. I get a kick out of people who are stuck on spot price and think that anything charged over that is profit. Not true.

The spot price is based on a contract for a future purchase in the next twelve months, cash purchase, no delivery, and for 'good' bars.

If you're some guy in a pawn shop or calling some dealer, you will always pay more than spot, always. I've been in the business my whole life and I pay more than spot. In fact, the company I work for buys millions of dollars of precious metals at a time and they pay over spot. But people hear on the radio or news "gold is 1460 an ounce today" and think that is the price for their coins or bars and anything charged above that is a markup or ripoff. Not true.

In the story you posted, yes. The shop is charging too much, obviously. And the value of coins is easily verified by going to pcgs.com or checking the coin red book.

If you're interested in buying gold and silver coins, don't go into some pawn shop or small local dealer. You don't even know if what you're buying is real. Go to an established dealer and one who will also buy it back at a reasonable price. I see tons of you 'spot guys' haggle about the price over spot for days and then have no place to sell it years down the line and end up taking pennies on the dollar. Apmex.com is a good place to buy online and they buy back too.

I'm dealing with large institutional buyers now and large IRA's but years ago, I would take calls from people and if they demanded, "What is your markup over spot?" I would just hang up. No use trying to educate them and even if you did, the trades were for small amounts and not worth it.

I hope you're not dealing with a lot of coins, using those as a price guide.

But on the other hand, if some dolt does check those prices, the only thing most of them will see is the price on a MS-68 proof coin, ya know?

The average schmuck on the street doesn't know how to read them properly, or even remotely understand condition factors.

Also, yeah on the spot. No storefront dealers I've ever known have sold at spot or less, no matter what.

rp_photo wrote:

It's a business much like payday loans or rent-to-own in that it's geared towards fleecing the desperate.

right... It's my understanding that those coins are there for decoration for the most part.  Pawns make the majority of their money on high interest loans with merchandise as collateral.  The stuff you see in the shops are probably mostly things that were left when the loan went into default.

John Jebbia wrote:
If a 100% gain on a single item isn't enough to keep a business afloat, even with overhead.. it's not a very sound business.

not true at all. With the exception of grocery stores and wal mart,  To cover overheads and (heaven forbid) make some money most retail needs to get at least three times the original cost of good, plus tax.

The real cost to the pawn shop is not just the money they put across the desk, its possibly half an hour spent haggling with the junkie that brought them in, more time getting rid of lowball bargain hunters that think the staff are idiots, and a bit more time dealing with people who are just insulted it cost more than they could find them online for, then more time pulling them out so someone can have a close look and work out if he wants to go home and buy it online. Then all the rest of normal overheads such as rent, insurance, security, utilities, etc etc etc

and to answer the original question, Yes, and they're quite right. In fact you generally don't go into retail until you realize that about 70-85% of the population are.

ELiffmann wrote:
right... It's my understanding that those coins are there for decoration for the most part.  Pawns make the majority of their money on high interest loans with merchandise as collateral.  The stuff you see in the shops are probably mostly things that were left when the loan went into default.

... up someone's nose.

There fixed that for you.

Studio36

John Jebbia wrote:
Question:
If you were the decision maker, would you rather double your money with a quick sale (assuming they really were put out just that day), or would you rather sit on them and wait for the price to come back up.. which even at it's peak didn't come close to $100 for the lot.

It's their business, and their job to stay in business. It's their job to know the market.

If you haven't noticed, there's been a buying frenzy going on for quite some time, for old gold and silver.

The value of the silver does not matter to the pawn shop selling them. What matters is if the guy who walks in behind you will pay their asking price.

---

Some other thoughts:

Doubling one's money on quarters is not much of a markup. I have a box full of copper pennies that are worth three times their face value in copper. So what? they are pennies.

At or near the price of silver, they shop owner may like to keep them as much as you would like to have them yourself. Holding value in gold and silver is not a bad hedge against the massive corruption of the purchasing power of the USD that's going on. It's also transportable and easily transferred for the real value it holds, not to mention the privacy that goes with it.

The price of silver is volatile. It's $22 per ounce today. It was $36 per ounce not too many weeks ago. When the Hunt Bros tried to corner the market, they drove the price up from $11 per oz to $50 per oz, and that was over 30 years ago. In today's market, "junk silver" is a sellers market because of the number of pie-eyed buyers who are trying to find their fortunes. There are also lots of industrial users of silver who are trying to stabilize their cost of inventory.

Pawn Shop sellers are hagglers trying to grub a buck. Look for your "junk silver" at cheaper prices elsewhere. Don't waste your time trying to liberate their silver from them.

On other kinds of buying, selling, holding you can 3x, 5x, 10x and more on your money, with sometimes very rapid turnover. Beware of the mob psychology of "gold fever" even as it applies to silver.

KonstantKarma wrote:
It's called "pawn" for a reason.

Haha.

That was cute.

John Jebbia wrote:

P.S. I would think that even an idiot who'd be interested in buying these coins knows their asking price is way way out of line!

I don't know... I would be such an idiot I guess... because I don't know how to properly assess the value of those coins, and I would know that a commercial entity like THAT would have a huge markup... and would probably pay it.

I ordered once wedding bands (platinum/gold) with stylish pattern... paid for both rings about $12,000... after the marriage was over, I tried to sell my ring, hoping I'd be able to clear a few grand... but... fcukno... less than a hundred... the rest is all markup...

udor wrote:

I don't know... I would be such an idiot I guess... because I don't know how to properly assess the value of those coins, and I would know that a commercial entity like THAT would have a huge markup... and would probably pay it.

I ordered once wedding bands (platinum/gold) with stylish pattern... paid for both rings about $12,000... after the marriage was over, I tried to sell my ring, hoping I'd be able to clear a few grand... but... fcukno... less than a hundred... the rest is all markup...

Everything is markup. If there was no markup there'd be no profit