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"Pawn Stars" Teaches How *Not* To Negotiate (infochachkie.com)
3 points by xatax on Nov 9, 2011 | hide | past | favorite | 1 comment


Many people that look to pawn items look at the item as opposed to the economics, where the pawnbroker is looking at the economics, they have no attachment to the item nor value. Even if the person presents a good deal to them, one has to realize that there will be another person that comes along that will settle for a 30-50% discount on the actually value of the item. Sure it is a different item and not "the" item that that person is selling, but the pawnbroker does not care, the item could be total junk so long as they can make their massive margin. Once you realize this and that the pawnbroker has limited capital and store space you then start to see the picture that there is no way you are going to get a fair price minus a decent margin. Because the next better deal is literally waiting behind you.

You are actually in a better position to reduce their margin when you are on the other end of the transaction. When you are standing with cash in hand, trying to chip away at an item that they have for sale. In this situation you hold all the cards so long as you do not reduce their margins past their absolute minimum. In which case, if it is a niche items that will not sell to just anyone, it is better to negotiate, walk away, let the item age on their self and then come back and negotiate again. Time is the best negotiation tactic, when dealing with shelf inventory, the pawnbroker will try to compress your time, your goal should be to expand it because expansion of time means that the pawnbroker eats up margin that he cannot recoup. An item has a fixed price and time eats at the margin built into that price.

Unfortunately Ebay has become kind of an insurance safety net for pawnbrokers and reduced the ability to negotiate for a portion of the deep discounts that they receive, but it cuts both ways too, it has also provided a medium to avoid the pawnbroker entirely. I cannot fathom for the life of me, why someone would pawn, with the exception of hot goods and emergencies in which a person needs cash right now.




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