I have a rule I abide by whenever I evaluate an item for pricing. I base it on how close to mint condition it is. If it has some damage, then, I deduct the appropriate percentage of my purchase price for that damage. Here’s an example: If a piece is heavily damaged, I might deduct 90% of what its mint value would be to come up with my offer. If there is very little damage, the deduction might only be 50% of its mint value. I always buy based on the item’s present value – not what the value could be after it’s repaired. I have found that it’s best to let your buyer pay to have a piece repaired, if they choose to. If I’ve bought well, I will still make the profit I intended. Buy and sell as is, always.
Here’s an example of why this is important. Yesterday, Ann, one of our most active members e-mailed me very excited about a rug she purchased for $8 at a house sale. She told me she’d taken the rug to a dealer who told her the rug could sell for $8,000 if she had it repaired. He could repair it for her at a cost of $1,600.
While selling an $8 item for $8,000 might sound like an excellent scenario, I told her not to repair the rug, but instead, offer to consign the rug, "as is," to that dealer to sell, and when it’s sold, she’ll accept just $5,000 and the buyer can pay for repair if they want to. Sounds like a good deal, huh? The dealer didn’t take the offer.
Then, I told her to take it a couple of other merchants to see what they have to say about the rug. She went to two more merchants and discovered that even repaired, the rug wouldn’t bring anywhere near the $8,000 she was quoted. Is it any wonder the first dealer, who offered to do the repair for her, wouldn’t accept her consignment offer?
You must be on guard against these types of schemes. They get your money, and at that point they’ve got their profit and could give a hoot whether or not you can ever sell it at a profit or break even with it. Every business has unscrupulous people trying to pick your pockets, and the antique business has not been miraculously spared of them. Don’t let them do this to you. The 31 Club is your best insurance policy against these types of people.
Ann has learned that selling her item in its present condition will make her far more profit than if she had repaired it. She can now see that repairing it would’ve proved to be a big loser for her. If she is able to sell this rug for $1,500 or more, “as is,” it will prove to be a very wise use of $8.
Even with the disappointment of not making about $6,000 profit on this $8 investment, Ann can buy for me any day. Her great eye can spot those special items others miss, and I’m fairly certain she can haggle on price very well. With your increasing knowledge base and continual practice, you can do this, too.
Don’t Buy Based on What You Think it Can Be. Buy it For What It Is.
Read this Blog a second time, or as many times as it takes you to understand the principles in it. Understanding this will save you huge amounts of time, money and a gray hair or two.
Please send in your stories so we can all learn from them. Sharing these stories with others will prevent us from making a lot of mistakes. Being a member of the 31 Club can guide you to becoming one of the most informed people out there in the field.
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