Dealer trades

garyg

garyg

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I'm wondering if others have had the same experience in trading with dealers. I approached a well known dealer regarding a trade that involved two excellent vintage ukes (lots of documentation of quality and sound) for one of the dealer's vintage ukes. I calculated a low retail value for the ukes and offered that in trade. The dealer instead counter-offered to trade me wholesale value on my ukes for full retail on his uke. Of course I said no, but I'm curious how common this practice is? I'll never buy anything from this well known store, but I wondered if others have had similar experiences. Enquiring minds want to know! g2
 
Dealers usually give lowball offers because they're trying to make a profit off your stuff. I've only traded gear with dealers when I wanted to downsize as quickly as possible and they had exactly the bass I was looking for. In hindsight, I would've been better off selling the stuff individually to people who were actually interested in what I had and then negotiating a better cash price for the bass.
 
The two times I tried such a thing I was offered around 30% of the value of my instrument as trade. Needless to say it didn't happen. Those kind of deals are for desperate folks only...
 
Yes, I've had lots of experience with this. It's very rare to get anything close to fair value on trade-ins. I just experienced it again yesterday. I found a uke that I wanted and had a guitar I could move. I was offered about a quarter of the price as to what the dealer would turn around and sell it for. No big deal, I decided to move forward with an offer for the uke I was interested in without the trade anyway. The guy wouldn't move off his eBay listed price even though it hadn't had a bid the first time around it was posted. Needless to say, I walked without the new uke while still carrying my guitar.

Can't really fault them for it though. They can run the business as they see fit. Just the same as I can patronize the businesses I choose.
 
Unless you run into a dealer who is more collector than dealer you are unlikely to get anything remotely approaching an even trade. Most dealers don't want to trade and (perhaps rightly) feel that they are doing you a favor if they agree to do so. Trades don't pay the rent and utilities, let alone put groceries in the kid's mouths!

John
 
If you want a descent price you sell it to the end user. A music store will only be slightly better than a pawn shop when it comes to these things.
One way to see what you can get is to search completed listings on ebay. See what they sold for and what they didn't, look at condition etc.
 
Well that was interesting, perhaps I should have mentioned that as someone who has been buying and selling vintage ukes for several years I know the market quite well, and that the trade offers made to the dealer were sufficiently low so that they could have held onto the ukes for several years and still done very well. Most interesting is that the "beat the trader" practice seems to be widespread, but I simply won't patronize any store that has to make a profit on both ends of the deal. Although the uke that I wanted was unusual - a Martin Taro Patch, the price was high and it had been in the dealers inventory for awhile. But being patient is the key to any good buy, so I walked away. cheers, g2
 
Yes most dealers want to make money on you both ways....that is how it is to pay for their overhead...best is sell it yourself on craigslist, marketplace or ebay..
 
As a dealer,

I agree with Andrew- I usually just can't offer a good trade price on a uke... unless it is something I know I already have a customer for. Most of the trades are trade ups, with worsens the situation.

Also, if it's a brand we carry, sometimes, our trade pricing is below what the second hand market is, which means it doesn't make sense to take that instrument on, unless at a low price. At the end of the day, we have business to run and mouths to feed so we have to make the offers which make the numbers work. Even though I would have loved to bring in quite a number of instruments over the years, sometimes, the numbers just don't work.

Most of the time, I do tell folks that I would rather not make an offer as it's going to be too low. If the customer insists on bringing instruments into the trade deal, then I have to make the numbers work.

Terence
 
mm stan said:
Yes most dealers want to make money on you both ways....that is how it is to pay for their overhead...best is sell it yourself on craigslist, marketplace or ebay..
Click to expand...

Yep, no different than a car dealer. They make money on your trade-in and on the new car they sell you. Dealers are in business to make a profit, can't blame them.
 
garyg said:
the trade offers made to the dealer were sufficiently low so that they could have held onto the ukes for several years and still done very well. Most interesting is that the "beat the trader" practice seems to be widespread, but I simply won't patronize any store that has to make a profit on both ends of the deal.
Click to expand...
Holding onto a product for a couple of years isn't ideal when you pay rent on the space that product takes up. Andrew was right in suggesting that an end user will give you the most profit for your uke. I don't sell ukes, but I do sell high end retail products and most of the time trades cloud up any deal.
 
pakhan said:
Most of the trades are trade ups, with worsens the situation.
Click to expand...

Very good point on that, though it may not apply to the OP's specific situation.

Still, there have been several times I've seen listings on Craig's List that read something like, "I have 2 Squier Strats, a Squier Tele, an Epiphone LP, a Samick SG clone, and an Ibanez 7-string - will trade all for a Gibson Les Paul or Paul Read Smith in nice condition..."

I always think to myself..."I'm very happy that you have finally learned that six two-hundred dollar guitars are not as good as one nice guitar - but why on earth would anyone who has a nice guitar want to trade it for your six pieces of junk?" :)

John
 
Very good feedback on this thread. A dealer who tries to make a profit on both ends of a deal is a businessman-- he is in the business to make a profit, after all. As many have observed, most dealers are interested in turning their stock into cash, not into more stock. The dealer has accepted the risk of selling the instruments, he is entitled to the rewards. If you are certain that you are giving the dealer a "great deal" in terms of trade, all you need to do is sell your instruments, pay cash for what the dealer has, and pocket the difference. Simple, right?

Oh, but what's that, you say? You can't sell your instruments right away? Or you can't get the price you want? Or you're afraid the dealer will sell his great instrument before you can turn yours into cash?

Welcome to Business 101. You want what the dealer has more than the dealer wants what you have. And so he has the strong position in the negotiation. You see, at the end of the transaction, you would have what you want: a new instrument. The dealer doesn't have what *he* wants (ie, cash); in fact, now he has two instruments he needs to sell, instead of one.
 
Okay, I was curious about how common this practice was and it appears universal. However I can do without the snide and condescending responses that really have little to do with my original question. I didn't want to go into great detail about the situation but I did try to indicate that I know quite a bit about the buying and selling of vintage instruments, and frankly there is a reasonable rebuttal for many of the "duh, that's the way business works" comments of many of the posts, but those points weren't addressing what I had asked. So that's the end of the thread for me. Thanks to those of you who did answer the original question which was how common is this practice. cheers, g2

RichM said:
Very good feedback on this thread. A dealer who tries to make a profit on both ends of a deal is a businessman-- he is in the business to make a profit, after all. As many have observed, most dealers are interested in turning their stock into cash, not into more stock. The dealer has accepted the risk of selling the instruments, he is entitled to the rewards. If you are certain that you are giving the dealer a "great deal" in terms of trade, all you need to do is sell your instruments, pay cash for what the dealer has, and pocket the difference. Simple, right?

Oh, but what's that, you say? You can't sell your instruments right away? Or you can't get the price you want? Or you're afraid the dealer will sell his great instrument before you can turn yours into cash?

Welcome to Business 101. You want what the dealer has more than the dealer wants what you have. And so he has the strong position in the negotiation. You see, at the end of the transaction, you would have what you want: a new instrument. The dealer doesn't have what *he* wants (ie, cash); in fact, now he has two instruments he needs to sell, instead of one.
Click to expand...
 
they have to make a profit...if you are expecting market $ on your ukes u are mistaken...if they make no money...how can they stay in business?
 
garyg said:
Okay, I was curious about how common this practice was and it appears universal. However I can do without the snide and condescending responses that really have little to do with my original question. I didn't want to go into great detail about the situation but I did try to indicate that I know quite a bit about the buying and selling of vintage instruments, and frankly there is a reasonable rebuttal for many of the "duh, that's the way business works" comments of many of the posts, but those points weren't addressing what I had asked. So that's the end of the thread for me. Thanks to those of you who did answer the original question which was how common is this practice. cheers, g2
Click to expand...

I certainly had no intention of being condescending, and I apologize if it came across that way. I was discussing the realities of doing business with a dealer, which I think are highly germane to this conversation. In your original post, you expressed surprise that the dealer expected to make a profit on both transactions, and at the fact he didn't seem to realize what a great deal he was being offered. My response and other responses have been fully responsive to those points, explaining why dealers feel the need to make a profit, and why your great deal wasn't such a great deal. If you already knew all that, I'm not sure I see the point of you starting this thread. But hopefully it will be educational to others.
 
At my shop we give you roughly 50-60% of what we feel we can sell it for. If your item can sell for $100, and we can sell it fast you'd get $60 in trade. Have to remember a shop is a business, and we are in business to make money. Sure it's a cool business, but in the end need to make cash. But we always tell our customers that the best thing to do is to sell it yourself. You'll get the most money that way :)
 
As a real-life example: I have wanted a Ludwig Wendell Hall banjo uke for a long time. One came along recently that was in wonderful condition, one of the best I've seen. The seller wanted too much for it. I got him to moderate his expectations a little, but in the end, his bottom price was still above market. I went back and forth, decided I really wanted it, and bit the bullet and paid too much. I love the thing, and the pain of paying too much will ebb in time. As a collector and a player, I'm happy to have this instrument, and I wanted it more than a few more dollars in my pocket. If I went to sell it, I probably would not get my purchase price back. I don't particularly care, because, as mentioned before, I love it.

This is a decision a dealer would *never* make. For the most part, dealers acquire instruments in the belief that they can resell them for more than they bought them for. As a collector, I can make emotional decisions. Dealer's can't, or they won't be dealers very long.

Because of my very large instrument collection, sometimes friends will ask me if I want to open a music store. I tell them they're crazy; loving instruments and selling instruments are such different things. I would never sell the really good stuff that came in the door, because I would want to keep it for myself!
 
It costs a lot of money to operate a business so it is a universal practice. If you want to see how people negotiate prices, just watch Pawn Stars.

Why would people consider trades anyways? There are many reasons but I can think of several:

1) Hassle of selling and packing
2) Potential complaints from buyers
3) Don't know who to sell it to
4) Takes a very long time to find the right buyer
5) They want something right away

Time is money.
 
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