Rinker on Collectibles: Managing and Sustaining this Nascent Recovery
The antiques and collectibles trade is in the early stages of an economic recovery, fueled by a host of positive trends in America’s general economy. The economic train’s engineer no longer sees light at the end of the tunnel. The engine has exited the portal. However, a majority of the train’s cars remain within the tunnel’s darkness. If a full recovery is to occur, it is essential the economic engine move forward.
I have witnessed a number of economic recoveries and declines during the 28 years that I have written “Rinker on Collectibles.” Each has provided me with insights into the operation of the antiques and collectibles trade and its relationship with the national and global economy. Two observations stand out. First, once recovery starts, individuals quickly forget what they did to turn the economy around. Second, as the recovery accelerates and the good times roll, little thought is given to preparing for the next downturn. Instead, a “get it and spend it while you can” mentality prevails.
The recovery from the 2008-2009 Great Recessions, or whatever name you assign to it, took longer than previous recessions. Five years later, the recovery is still in its infancy. The prediction for a full recovery is three to five years in the future.
This column offers my suggestions on what the antiques and collectibles trade needs to do to manage and sustain the recovery. Given what I am about to propose, I have little expectation my suggestions will be followed. The prevailing business philosophy in the antiques and collectibles trade in respect to the greatest good is what is best for me is the wisest course, the trade as a whole be damned. The individual is dominant in the business. The collective whole is an ideal.
Affordability is one of the primary tools driving the antiques and collectibles trade recovery. Sellers are offering objects at price points that the general public perceives as attractive. The price point for the majority of objects is between $5 and $25. As a result, successful sellers rely on volume sales as opposed to one or two key sales to sustain their business.
Because so many buyers are motivated by decorative, nostalgic and reuse reasons, objects in the secondary market have to be (1) cheaper than new and/or (2) support a look unique to that specific buyer. Dealers need to be aware of the price for a comparable new item at Big Box, chain store and local merchant shops. In 2013, more competition for the buyers’ dollars comes from outside than inside the trade.
It is critical that the current pricing affordability be maintained. If a piece sells, raising the price on the next example is the prevailing tendency. Hidden deep within the dealer’s mindset is the concept that if a piece sells, it was priced too low. The correct assumptions are (a) the piece sold because it was priced right and (b) the price at which it sold is its best-selling price.
After almost half a decade of tough times, it is hard to argue in favor of not taking advantage of an opportunity to raise prices. Sellers need to keep in mind the relationship between affordability and bargain. The antiques and collectibles trade enjoys its greatest prosperity when the general public perceives that its objects are a bargain.
The antiques and collectibles trade does not have a national public relations agency promoting its products. No sale banners pop up on AOL, Google and other Internet websites. The trade’s advertising is primarily word of mouth. Every buyer is a potential public relations agent. It is all about the buzz. “Go there for bargains” is the best buzz possible.
The concept that success is predicated upon giving customers what they want is driving the antiques and collectibles trade recovery. Traditional dealers, especially those specializing in the antiques sector, still have difficulty accepting this. Historically, the trade told customers what they should buy, a practice that worked when collectors were the trade’s primary customers. Today, customers will not come if the trade cannot supply their needs.
Dealers must acquaint themselves with the latest decorating and environmental trends. Once identified, dealers can adjust their merchandise to offer objects that accessorize these looks and philosophies. When displaying and selling merchandise, make the connections clear. Dealers who develop a designer mentality have a distinct advantage.
Those dealers who see this selling trend as temporary and look forward to the return of the Golden Age of the Collector are living in La-La Land. Twenty-first century collecting is a far different entity from 19th and 20th century collecting. Collections are smaller, trendy and temporary. At the high end, investment, show and tax deductions are more important than aesthetics and love.
Dealers can no longer rest content offering the same merchandise year in and year out. Successful dealers must continually adjust their stock. The old concept that sooner or later someone will appear to buy an object at the asked price is ancient history. Buyers will not buy from a dealer with stale merchandise. Dealers who think customers do not track or remember previously offered pieces are fooling themselves. As a result, the percentage of merchandise that a dealer has to write off as a total loss has increased. It is a cost of doing business. Storing stale merchandise until buyer interest recycles is not an option. The warehouse cost is prohibitive.
The digital age is now. Those dealers who ignore it lessen their chance of success and survival. Instant gratification is part of the buying mindset. Dealers who assume buyers will wait until they visit a flea market, mall, shop or show to acquire an object they desire are mistaken. Dealers need to enhance their customer cultivation skills and adopt methods to reach them the moment they acquire merchandise that matches a customer’s wants.
Websites such as eBay, GoAntiques—as part of WorthPiont—Ruby Lane and TIAS offer Internet storefronts. More and more dealers are developing their own websites, using trade paper advertising and booths at flea markets, malls, shops and shows to drive customers to these websites. An Internet storefront is open 24/7.
Although e-mail offers an inexpensive method to reach customers, few dealers secure customers’ e-mails. This is a missed opportunity. I am currently tracking several dealers who have switched from mailed to e-mailed newsletters and more than a dozen auctioneers and dealers who are doing specialized, limited-offering auctions on the Internet on a monthly or bimonthly basis. Thus far, the results are better than expected.
I have my own website (badly in need of an overhaul, which I hope to have done by the end of the year), blog regularly for American Collectors Insurance and Ruby Lane, do a weekly antiques and collectibles call-in radio show that streams live on the Internet and syndicate this column to several Internet websites. By the end of the year, I am planning to create a Twitter account, write my own blog sharing my thoughts on day-to-day events within the trade, and offer a live weekly chat opportunity. I also am exploring other digital avenues. The world is not flat.
Dealers need to react to Internet pricing information. It no longer can be ignored. EBay pricing is only one source. Prices realized by auction houses, readily available on their websites and on websites such as Craigslist, Esty and LiveAuctioneers are other options. In the 21st century, the printed price guide is more an identification than pricing source. Buyer sophistication continues to grow as they peruse these same sources. Rather than seeing access to price information as a deterrent, dealers must learn to use it to their advantage.
Resisting greed is the most critical element to managing and sustaining economic recovery in the antiques and collectibles trade. Private sellers need to understand and accept that dealers are entitled to a reasonable profit, times three at a minimum, and not become enamored by the misinformation and misinterpretation of values seen on reality television. Dealers need to set prices that encourage individuals to return as repeat customers. They need to buy tough so they can maintain current pricing levels as long as possible.
Finally, everyone in the trade needs to become a spokesperson. Think positive and talk positive. Enthusiasm is contagious.
These are my thoughts and suggestion. What do you think needs to be done to manage and sustain the recovery? Share your ideas with me at email@example.com.
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 firstname.lastname@example.org. 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. 2013
WorthPoint—Discover Your Hidden Wealth