Over the last decade, pawn shops have increased – now, you can find a pawn shop in almost every town. With an increase in the pawn shops, this means that pawn shop owners are forced to be a bit more on the creative side with their businesses.
Most pawn shops purchase products out right for a fraction of its value, then they turn around and resell it for profit. If an item is used, in fairly good condition, and still of present value, a quarter of its value is a common and reasonable offer, which still allows you to sell it at half of its original retail price and still double your profits.
Some Pawn Shops Sell Online and are Willing to Trade Up
With Ebay, Amazon, and Craigslist, a majority of sales completed by a pawn shop are more likely to be sold on these sites as opposed to through their own doors. Some pawn shops also accept trades as well. This is probably not a common practice for most, but for some of the smaller mom and pop shops, if the trade is a “trade up” and the business owner can turn an even higher profit on the item, than a trade may be agreeable as well.
Also if a pawn shop has an item sitting on a shelf for a long period of time collecting dust and they are offered a trade towards it for an item they know they can resell much faster, many times, they would accept the trade.
Along with these obvious extra transactions common in a pawnshop, like Majorpawn.com, others have also taken on watch and watch battery repair, cellular phone sales, repairs, and payments, along with utility bill payments as well. Most common for pawn shops is to add a section for a retail jewelry store. This is so popular with pawn shops because when they are buying jewelry from customers, they are most often paying scrap metal prices regardless if the jewelry is broken or not. We have noticed that jewelry is marked up around the way of 500%-1000% in retail jewelry stores.
What pawn shops are paying on scrap metal prices, there is still a huge profit margin for them to resell this jewelry at decent retail prices, but still blow away their retail jewelry store competition. It is also a common add on because pawn shops used to be set up in the rear of jewelry stores. This was set up so those on the outside would only see you heading for a jewelry store and not an “embarrassing” pawn shop.
Although all of these practices are what keeps pawn shops running, the act of charging interest on loans is mainly their bread and butter. With that being said, the objective of a pawn shop is to have as much money as possible loaned out on the street collecting interest. Therefore, pawn shops are very likely to renew contracts and offer more time to pay back loans. In the end, we encourage you to take a look at MajorPawn.com.