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Rinker on Collectibles: The ‘I Must Have It’ Price

by Harry Rinker (11/21/11).

I received the following e-mail from Shawn, who reads “Rinker on Collectibles” on WorthPoint: “As a collector, I have been frustrated by sellers’ unrealistic prices more and more in recent years. As eBay has shifted to more “Buy It Now” listings, it gives sellers more opportunity to stick to ‘but, it’s my price.’

“I have been watching a tea set for more than a year. The seller is asking $419. A well-known collector with lots of knowledge in that area tells me he would pay $125. But, the seller says she had it appraised for $350 several years ago, so she wants $350—never mind that values have fallen as the economy crashed. This is just one example.

“Some folks have told me that if I truly want it, I should just buy it. But that is ridiculous. I do not mind paying a ‘I must have it’ premium, but I cannot (and would be stupid) to overpay by hundreds. So I do not buy.”

Congratulations, Shawn. You have more will power than most. I have been an “I must have it” victim on multiple occasions. I am not alone. It is a sad day when desire overrides common sense.

I learned early in my buying career to track objects. As spring antiques shows returned for fall appearances, I noticed the same objects that I had seen in spring booths reappeared in fall booths. They often were in the exact location in the display. I was not naïve or gullible to believe the dealer’s claim that: “I sold the one I had in the spring and was lucky to find another. I bought it and am delighted to offer it for sale again.” When I checked the price, it always was identical to that asked for the object six months earlier. The price tag had an aged quality. Few dealers rotate merchandise. They continue to display the same object, trusting the good Lord to send them a buyer. Perhaps, “sucker” is a better word choice.

Once I understood this, I studied other sale venues from flea markets to antiques malls. The same thing occurred. An object remained in the same location in an antiques mall booth for months, even years. Given this, the buyer has no incentive to buy. While there are multiple possibilities to explain why the object has not sold, the most obvious is that it is overpriced.

[Author’s Aside #1: Unsold object longevity can be determined several ways: (1) spotting the object’s shape in a dust silhouette on a shelf after picking it up for inspection; (2) the object is covered with dust [be careful; dust also hides defects]; (3) the sale tag is dirty and discolored from exposure; and (4) the writing on the sale tag is starting to fade or has faded.]

I have tracked objects as long as two year before I have approached the owner and made a counteroffer. I lost count of the number of times the seller said no, holding on to the belief that ultimately he will find a buyer willing to pay the price he asks. Any money is better than no money is a maxim that is only reluctantly applied by antiques and collectibles dealers.

As an appraiser and one who often is asked to evaluate appraisals done by others, I discovered long ago that there are unscrupulous appraisers who provide values they know will make their clients happy rather than realistic prices that disappoint. A number of these individuals serve as hosts or experts on the current crop of antiques and collectibles cable reality television shows.

When an owner of an object, whether collector or dealer, hears or sees a value that pleases him, that number becomes a benchmark in his mind. This becomes the minimum value an object is worth. Anything less is unacceptable. Any offer below that number is an insult.

The result is a hodgepodge of overpriced and overvalued merchandise that constitutes the inventory of a dealer when he (or God acting on his behalf) reaches the decision to go out of business. I love going to an auction of a dealer’s inventory. Merchandise usually sells for 10 to 20 percent of the sticker price. Had the dealer been willing to accept reasonable offers and/or adjusted his pricing to reflect existing economic market trends, the dealer would have sold his inventory while still breathing

[Author’s Aside #2: While I have no firm proof, many dealers feel an object is priced correctly only if it does not sell. If it does sell, the dealer becomes suspicious, often convinced, that he undervalued the object. Although this logic makes absolutely no sense, it remains a staple in the trade.]

There are no minimum or maximum values in the antiques and collectible trade. All objects have no value except for the brief instance when they are sold. Value is what someone is willing to pay. The dealer selling the teapot thinks someone will pay at least $350 and has every right to ask it. He also has the right to die with it, which is likely to happen in this instance.

There is a group of dealers identified as nostalgia merchants. Nostalgia merchants prey on individuals desiring to recapture their childhood memories. These individuals are not collectors. A memory is triggered. The buyer wants to relive it immediately. Instant gratification is required. Patience, comparison shopping and common sense are cast to the wind. The person pays whatever the dealer asks.

I first encountered this while talking with a dealer who specialized in 1950s and 1960s cap guns. The prices asked on his sales list were double to triple those I encountered in the field. When I asked if he actually received these values, he assured me that he did. When I asked why, he informed me that he was selling to a one-time—not a repeat—customer. The person who came to him was willing to pay whatever it took to buy back his childhood treasure immediately.

This “I must have it price” is the modern equivalent of the old “buy it now, you may never see it again” price. Until the 1980s, collectors had limited buying opportunities. Antiques shows occurred twice a year; three times if an area was fortunate. A day’s drive through the countryside to visit shops happened four to six times a year. Collectors and others were so delighted to find something they sought that they bought it immediately. While bargaining was practiced, the practice was minimal.

In the 2010s, buying opportunities abound. Antiques malls and the Internet provide a daily fix. Buyers understand that most objects were mass-produced and the survival rate is high. Even if the buyer wants it immediately, the Internet offers the opportunity for immediate comparison shopping. There is no longer any need to overpay.

As Shawn demonstrated, the “I must have it” price is now a personal price. The sophistication of today’s buyers allows the buyer, not the seller, to determine the “I must have it price.” The price on the dealer’s sale tag is no longer a starting point, let alone absolute. Rather, today’s buyer places it in context with what he is willing to pay—and not one penny more. If the seller is not ready to come down to the buyer’s price, no sale occurs.

In fairness, Shawn showed that desire can cloud the process. He was willing to consider an “I must have it now” premium. Once again, control of the process remained with Shawn. He determined what the “I must have it now” price was. The only role the dealer had in the transaction was to accept or reject Shawn’s offer.

As a collector, Shawn recognized that the balance of power in the sales equation has shifted in favor of the buyer. While an advocate of a win-win buying scenario, I am a realist. Power in today’s antiques and collectibles market rests with the buyer with cash, not the dealer with the merchandise.

In these tough economic times, with no signs of relief on the horizon, dealers need to ignore what they paid or for what someone appraised their objects and do what it takes to sell them. Cash, any cash, is better than no cash. Any sale is better than no sale.

Buyers are voting with their pocketbook. A shut pocketbook is a vote of no confidence, something the antiques and collectibles trade can ill afford.

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Rinker Enterprises and Harry L. Rinker are on the Internet. Check out Harry’s Web site..

You can listen and participate in Harry’s antiques-and-collectibles radio call-in show “Whatcha Got?” on Sunday mornings between 8 a.m. and 10 a.m. Eastern Time. It streams live on the Genesis Communications Network.

“Sell, Keep Or Toss? How To Downsize A Home, Settle An Estate, And Appraise Personal Property” (House of Collectibles, an imprint of the Random House Information Group), Harry’s latest book, is available at your favorite bookstore and via Harry’s Web site..

Harry L. Rinker welcomes questions from readers about collectibles, those mass-produced items from the 20th century. Selected queries will be answered on this site. Harry cannot provide personal answers. Send your questions to: Rinker on Collectibles, 5955 Mill Pond Court SE, Kentwood, MI 49512. You can e-mail your questions to harrylrinker@aol.com. Only e-mails containing a full name and mailing address will be considered. Please indicate that these are questions for WorthPoint.

Copyright © Rinker Enterprises, Inc. 2011

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11 Responses to “Rinker on Collectibles: The ‘I Must Have It’ Price”

  1. Harry fails to note that many items have readily available duplicates. Those items are the most price sensitive. Many other items are unique and have no comparables. Price is far less important but not irrelevant. However finding a customer who wants the unique object is not easy. Many times the same object at the same price is shown over a period of years until the only customer is located. The price asked might just be far less than the only customer would have paid even though many others were never interested in even looking at the unique item. Knowledge of who the unique customer is for unique objects allows a dealer to make a profit on items that others find unsaleable. One man’s dead item is anothers hot item with the right customer.

  2. So, yes, to some extent Harry is right. But, Harry, you are also wrong. As a dealer in vintage and antique jewelry, I can tell you that even overpriced items might not be overpriced forever. I have many items in my inventory that are over five or even ten years old, and these items sell on a daily basis, sometimes because they have just finally found the right buyer who’s fancy the item strikes. Sometimes it’s because the item becomes fashionable again, but more often than not it’s because the market value has risen enough to bring the item price in line with current values.

    I do 99% of my buying in Europe and I purchase fine jewelry. Perhaps your article only applies to collectables, but in the jewelry market prices continue to rise while sought after items become harder and harder to source at any price point, and I suspect the same is true of most segments of the antique marketplace. To say that a dealer should ignore what they paid for an item or what that item is worth (appraises for) is a bit ludicrous and would lead to a lot of dealers (myself included) going quickly out of business because we couldn’t afford to replace the inventory that we sell.

    Articles like this one, sadly, undermine the confidence of the antique and vintage buying public. Certainly some folks are more collectors than they are dealers and so might not be willing to part with an object even for a fair price, but I suspect that many, many more dealers are in the game to buy and to sell and are merely trying to make an honest living doing something they love.

  3. Terry Mangum says:

    Good article. I too go to shows and see the same item at the spring, the summer and fall show, without a change in price nor any relation to what the market may be for the item.
    I understand that for many dealers, it’s a hobby and not a business, so if they don’t sell today – no big deal, plus the dream of hitting that “home run” on an item keeps many going.
    As an auctioneer, I am well aware that the value of an item is what someone is willing to pay for it. Period. If an item is properly exposed to the buying public for a reasonable amount of time and it doesn’t sell, it usually is a factor of price.
    If a seller never sells their item, then they can believe as long as they want that it’s worth whatever price they want it to be.
    We all make mistakes in buying items to resell, but an even bigger mistake is not taking your loss and moving on.
    Terry

  4. Chad Bogues says:

    I agree with Harry on his points. But I also agree with Terry Magnum in a way. It all depends on the dealer. What are their motivations to sell for price X, and what incentive to they have to sell for price X minus Y?

    For me, the higher the price that I had to pay for an item, the more likely I am to unload it at a discount or even a small loss.

    For example, if I buy an item and pay $700 for it and have it marked at a thousand dollars and I have had it for more than a month or so, I’d probably be willing to let it go for near the $700 or a bit less if I had a solid offer.

    However, if I found the item in a lot or an attic and essentially paid zero for it, then I want to stick close to that thousand buck price.

    Why? God only knows, but that’s they way my mind works. It’s a bit counter-intuitive, but I look at it like this, if I didn’t pay anything for an item, I haven’t risked anything. So if I sell it for a good price, then it’s a huge bonus. I don’t want to sell the item for even $500, despite having paid nothing for it, if I think I might be able to get $1000.

    Also remember that selling things at super inflated prices is harder, but also it takes fewer sales to make the same amount of money.

  5. Darren Shank says:

    Once again Harry you nailed it right on the head. Twenty five years in the business on both sides of the counter and you are dead on. Nothing is more humorous than seeing the same overpriced item sit on the same shelf in an antique store, mall, or ebay… for Years! Most comments that have been posted are likely from people who can sit on their merchandise forever, and like you say die with it. Obviously they have plenty of money to pay their booth rental or ebay listing til the end of time. I know dealers whose inventory has not moved in 2-3 years yet they refuse to lower their prices. ‘I paid $80 for this 8 track player in 1983 and I’m not lowering my $150 price.’ The first $20 that was offered i would be carrying it to their car. Turn & Burn… I completely disagree w/ Victoria as it is obvious more dealers are collectors and not sellers. They collected for a lifetime and everything has some ‘personal value’ to it and now the common as sand 1970′s item is $100. If this were not the case there would not be millions of sq. feet in antique malls packed with dust covered ‘stuff’. Vendors around my booths ask all the time how do you sell so much? Uhh, because it’s priced correctly. In this economy Every dealer out there should evaluate how their inventory is priced. Unless you don’t care if it sells or not… and then are you really a dealer or a hoarder with overpriced stuff…

  6. Jay says:

    As I was reading the comments I was like…wtf…holding inventory for 5-10 years! I’m a fairly young dealer in my twenties and I hate holding anything for more than 6 months!

    Price transparency is also more easier now than ever. I don’t know how many times I’ve seen people shopping with their iphone or ipad looking things up online and comparing it with the sticker price the seller is asking. Best of all this is happening at yard and tag sales too!

    My focus is on inventory turn and learning how to take losses when I’ve made a buying mistake.

    • Terry Mangum says:

      One more comment about pricing. This is just my theory, but I don’t believe I’m too far off. Stay with me on this.
      Dealer A acquires an excellent example of an XYZ Widget. Price guide says average condition is worth $100. Dealer A thinks his is better than average so prices it at $120.
      Dealer B sees the $120 Widget at a show and says, “Mine is just as good, but I want to sell it, so I’ll price mine at $115″
      Dealer C happens to pick up a Widget that’s different and more unique, but can’t find a reference, but based upon what Dealers A & B are pricing them at, figures $150 is the way to maximize her return.
      What I’m getting at, is I believe a good deal of unrealistic pricing is based upon bench marks created by other unrealistic pricing. Chances are neither Dealer A, B or C have any idea if XYZ Widgets sell at all or if they sell anywhere close to the price guide, which while being new, could be using data from years ago.
      How much pricing is based upon myth and not reality? A number of years ago the buzz at shows was, “These are going on Ebay for XXXXXX!” I’d always ask, “Are they selling, have you checked the sold listings, or are they just being listed for that amount?” Usually the person had no idea as to how to check sold listings.
      As Mr. Rinker said, the dealer has the right to price it at whatever price they like – and they have the right to die with it, which many will do.

  7. Richard Harris says:

    It works both ways. Buyers will roll their eyes at prices, even though the price is fair in the market. I spend a lot of time researching pricing, my rule of thumb is if it is on e-bay my price is 1/2 of the buy it now. I check my competition’s pricing also and am consistently under theirs and yet the buyers still want it for less.

    Often high tag prices are the way of starting a negotiation that results in a fair sale.

    On the other hand, I do agree that some seller’s price structure is incomprehensible. Just this weekend I found a pair of relatively nominal sterling silver compotes. The seller was asking $500 for the pair! I imagine she will have them until she dies.

    • I’m with you Richard Harris. I too spend a great deal of time researching the going prices since no one knows what the value is on anything these days (unless it sells like Harry says), and the price guides are useless since the recession. But even with fair prices below other dealers the buyer expects the seller to come down these days. So I play the game and price a little higher than I would to accommodate them so they feel good. I am also willing to go below my comfort zone just to make a sale. Just because goods have decreased in price, services have done the opposite. It is extremely expensive to bring my business to the buyer.

      I also spend a month in the spring and the fall changing my complete inventory for antique shows. I clean my cases (which I display all hands on so they are sometimes dusty depending on the weather) and display pieces for the upcoming season (I sell antique to vintage costume jewelry). Before each show I hand write post cards to my regular customers, as well as those that have requested to be on my mailing list. I run an End of Year Blowout Sale each year on my website to keep it fresh. My business was just starting to take off when things went bust.

      As items age the chance to re-stock at any price becomes harder. I have some pieces that are rare or one of kind that I have hung on to for years just because I know once it’s gone there is no replacing it, and my price is inexpensive for what it is. Even with a website presence, the right buyer has just not found me yet. What are selling in the vintage jewelry market these days are top name designer pieces. They are going for a song and will never be replaced for the prices they are bringing.

      I started my business a decade ago after losing my job and being unemployed for two years. Now my husband has been without work for over two years. We have no income. We went to Brimfield for the first time this fall. It cost us over $1500 to do the show living as cheaply as possible and we ended up in six inches of water on the N.E. Motel lot where we were set up. All our fall shows experienced the same weather except one, which had record attendance of happy observers with their hands in their pockets. Truth be told not one shopper would work as hard as I do for the money it brings. All we’re doing is keeping the money circulating so we don’t end up on the street. I know plenty of dealers that have gone out of business this year because they couldn’t sell their stock at any price.

  8. Quote;
    “As an appraiser and one who often is asked to evaluate appraisals done by others, I discovered long ago that there are unscrupulous appraisers who provide values they know will make their clients happy rather than realistic prices that disappoint. A number of these individuals serve as hosts or experts on the current crop of antiques and collectibles cable reality television shows.”

    The greatest flaw when evaluating appraisals is not properly stating the purpose of the appraisal and in so doing, not justifying the value level being set. Appraisal values are set for a variety of purposes and so have different values for the same object based on the needs of the person getting the appraisal.

    Use a house as an example though it is not an antique. When a house sells through an agent in a multilisted situation the price paid is obviously the value at that time. An appraisal of what it is worth would be equal to the sale price at the time of the sale but the seller would not pocket the same value as they would need to pay the realtor’s commission and so will receive a lesser amount. An appraisal of the same property to settle an estate should be made at the amount the seller actually receives after commissions were paid.
    A third value would be the insurance replacement value. This would be the actual cost of materials and labor to rebuild the house if it were destroyed. On many houses this value might be several times the purchase price.

    When the appraisal or a person evaluating the appraisal do not state the purpose the reader cannot determine the value level in relation to their needs. Confusion reigns supreme in these situations. Television shows with unwritten and unstated purposes of appraisal further complicate the public ability to understand appraisal values.

    Greater confusion occurs when time passes after the appraisal is done as values may change rapidly, up or down, after the appraisal is completed. So the date of the appraisal should always be evident to clarify the evaluation. Price guides are always after the fact, many times years after, and rarely indicate sizes and condition reports.

  9. Shawn says:

    Lol! Imagine my surprise to see myself quoted! Thanks, Harry!

    Here’s an interesting tidbit: My seller finally has dropped her price on the tea set below the appraised value.

    In this case, the seller received the set as a gift years ago. It is unique — probably not the only one ever made, but the only one I’ve seen and the only one available online for the past 18 months. I’m not sure exactly how old it is — maybe early 20th century, maybe late 19th. It’s Asian and hand decorated, so neither of us know what it says. I collect Asian tea sets, and this one is close to what I collect. But I did consult a specialized collector, who says that the set was not made by a known and collected artist.

    She told me that she had it appraised years ago, but I don’t know more than that. She planned to leave it to her kids if she couldn’t get $350 for it. It’s been listed on ebay for years, so she’s got the biggest audience possible. I’m the only person to have made an ebay offer on it.

    As a collector, I’m fine with letting my desire play a part in setting the price I will pay. I buy because I want something. I certainly think about price and resale value, simply because I sometimes swap things in and out of my collection. If I set a price for myself, it comes from how badly I want something, how well it will fit my collection, how scarce I think it is based on my years of ebay shopping, condition, what I can afford, and what I think is fair.

    In this case, I’m willing to go above the value set by my collector expert because I know the set is unique, it is in good condition and it fits my collection. But I simply can’t afford to pay her price that was set by some unknown appraiser without something to show me that the set has that value.

    Unfortunately, we still haven’t reached an agreement on the price, and it’s no longer high on my must-have list. Maybe her kids will get it someday, and they will drop the price.

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