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Have you ever thought about how pawn shops reach a price for your items? Maybe you’re thinking about selling some old jewellery or even a TV you no longer use. There are a couple of things that come into play when determining just how much you will get for your preloved items.
There are tips you can find online to help you understand how it all works. In this article, let’s take a closer look at how pawn shops reach their pricing decisions.
Assessing Your Items
The process all starts when you take along your items to pawn, be it a musical instrument, electronics, jewellery, or pretty much anything else.
Pawn shops Sydney has such as Gold Buyers Sydney will assess your items for their marketability and condition. They’ll test each item and carefully examine them for scratches, flaws and any other potential damage. They’ll also consider the supply and demand for your particular items.
To assess the value of each item, the pawn shop will use a blue book or guidebook, internet search engines, catalogues and of course their own experience. Many pawnbrokers have enough experience to identify gems and precious metals in order to assess jewellery.
Making Sure Your Items Are Legitimate
Pawn brokers always play it safe and assume the risk that an item may be stolen. That’s why they require some form of identification from you, like your driver’s license.
Once it’s determined that your items are genuine and not stolen, and they they’re marketable, the pawn shop will offer you an amount. You can either sell your items outright or offer them as collateral on a loan.
Figuring Out The Loan Amount
So, how much can you actually get for the items you want to pawn? To figure out the amount of the loan, the pawnbroker takes several factors into account. One particularly important factor is an item’s predicted resale value, or range. The low point is the wholesale value of the item, and that makes it a difficult item to sell. The higher point is the retail sale price should the items be sold in the pawn shop.
Is Your Item Sought After?
Pawn brokers also consider the supply and demand for your items to figure out if they will be able to sell the items to a wholesale or retail customer.
When it comes to calculating the estimated selling price, pawn shops also factor in the overhead costs of their stores, website costs, staff, adverts, insurance and so on, as well as profit.
Will You Repay The Loan?
As for determining the loan amount, the pawnbroker will assess how likely you are to return and repay your loan and reclaim your item. After all, pawn shops are in business to make interest off the loans.
How Much Are You Asking?
The amount you want is also factored into the assessment. If you have highly attractive items and you want a low price, chances are the pawnbroker will accept it on the spot.
Overall, pawnbrokers have years of experience, along with guidebooks and the internet to figure out how much each item that’s brought into their store is worth.