I can understand making 25-50% off of an item as they have to haul/ship it back to their store, clean it up a little, keep it inventory, and market it. But when they boast that they're making more than double their money, they come off as con-artists. They say they've been picking and collecting all of their lives, why not share the wealth a little with the people that they buy from?
Look, I'm not sticking up for the guys. I happen to be neutral and believe it's
all planned and scripted, so what the hell is the difference?
My feeling is this: If you're sitting around with a bunch of crap, making no effort to unload any of it, it's not making you a dime. A lot of these people are hoarders and don't even know what they have.
So what if some pickers pay you $25 for something and they sell it for $100? Whose business is it? That's Capitalism. (Does your millionaire doctor give you a price break because he has enough money?)
Are you going to hang on to all your junk -- because "maybe" you could have gotten more for it? So, you'll sit there with your crap. If you sell it, you have $25 you didn't have before.
Plus, the show digs the stuff out of the dirt and hauls it away. (What Mike and Frank move is strictly for the camera. You can bet there's an entire crew involved.) You don't even get your hands dirty. Let a few items go like this, and you've made a pretty penny.
Two other points:
1 - Mike and Frank make most of their money from the show -- not from selling junk.
2 - The sellers are fully informed when they go on this "reality show." No one is holding a gun to their heads to make them sell.
I can't get over how irate some people get over this show. That's your right, but you're losing sight of the fact that the show isn't real.
And, even if it was real, the points I made hold true: You can hold on to your junk out of fear of being ripped off, or you can make the rational decision to sell and make a few bucks. That's entirely up to you.
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dan_kot
11 years ago
I'm not irate nor am I disputing any of your statements. I think my only issue is the seemingly predatory mark-ups that they state about their transactions at the conclusion of their visits. Because so many so-called reality shows are scripted these days, maybe we don't even know the real purchasing and selling prices. So I guess I'll rephrase it by saying that whomever is writing the scripts and/or storylines for this show could do a better job by not making them look like ripoff artists. I doubt I'll continue to watch because I just personally don't like either one of the stars, but if I do, I will always hope that one day some old man gets the better of them and sells them a fake artifact that they lose their shirts on. To me, being fans of Mike and Frank is like rooting for the bad guys.
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rp69
11 years ago
It does seem predatory, but that's the nature of the beast. I've been saying it about Pawn Stars since it started. Those guys never make less than 100-200%
The various businesses that I've been in over the years, we never made anywhere close to 100% profit.
New cars, we were lucky to make $2000 on a $30k car. Up front profit was usually zero, we'd get a few hundred dollars in holdback(non-commissioned profit where the salesman gets screwed) A couple hundred dollars in finance reserve(where the customer gets screwed), $100 in floor plan money(if we paid within the first month), and up to $1500 in secret dealer cash from the manufacturer. that usually got thrown in the deal to be competitive. the average salesman's commission was about $200 on a new domestic car.
Wine and liquor store made 40% on wine, 25% on hard booze. Sometimes a little more or less. Not even counting sales and advertisements.
Hardware store 10-40% tops. Nickel and dime stuff was doubled, but tools and power equipment was no where near even 50%, usually about 25%.
I would also guess that anybody that appears on this show is getting a nice fee.
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mjsullivan1989
11 years ago
I have to disagree with you on the hardware store aspect. A big box retailer like lowes or home depot may operate on margins less than 10% but smaller retailers like ace and true value are more like an average of 45%. Power tools bring in 5% to negative margins but electrical items(outlets, faceplates etc) can be up to 1000% margin.
Back on topic though, there is nothing predatory about what they do. Its business, and if it wasn't for the income from the show, the only way that the could survive is with the items that make 50% or more.
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rp69
11 years ago
@ mjsullivan1989 Re Hardware Stores
There are no 1000% mark-ups...Ever. Not even close. Guys do shoot for a 45% avarage mark-up. Back when I had my shop, average 45 was the golden number for most small retai businesses. But it's nearly impossible to be compettive at that rate. These days big box stores are A) Stealing your customers with cheap prices and a false promise of better service and B) driving down your margins. So the damage is two-fold. That's why most Mom and Pop businesses are gone. There are still a few around, but if you're over 40 you would remember when Mom and Pop stores ran the economy, and built a solid middle class.
And that 45% average mark-up is not even net profit. Out of that comes your operating costs.
Getting back on topic. Rick over at Pawn Stars telling some guy that just had his antique appraised at 2 grand "ain't gonna happen, I'll give you 800" really is almost thievery. 150% mark-up on high ticket items doesn't happen in most retail businesses.
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mjsullivan1989
11 years ago
I worked at one. I did the ordering. There are certain items with 1000% markups. Not all the items of course, but there are some. In fact, all the fasteners (screws, bolts, nuts etc) were easily a 500-1000% markup. Bolts that we get for $.25 to $.30 were retailed at $2.50 - $3.10. Just these fasteners alone constituted about 3-5% of total sales so it definitely improved our average margin.
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Syn84
11 years ago
It does seem predatory, but that's the nature of the beast. I've been saying it about Pawn Stars since it started. Those guys never make less than 100-200%
Sure they do. If they buy something for $1,000 and sell for $2,000, they don't make a $1,000 profit because there are many costs to run a business. In fact, most of pawn shops make the majority of their income on loan, not on buying and selling stuff.
Same thing with American Pickers. I haven't been watching the show closely lately, but I believe they have two storage buildings, for which rent ain't cheap, then there is a cost of van, gas, food, hotel, paying Danielle, etc. So that "50% profit" easily turns into a much smaller number.
In addition, offering 50% of the real price isn't such a bad number (if a seller doesn't like it, they can easily say "no"). If anyone has been watching Desert Car Kings, they usually offer only 25% of the actual car value because of their costs to run a business.
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rp69
11 years ago
@Syn84
Aside from nickel and dime stuff, 100% mark-ups are not normal in honest retail.
Back before Walmart and Home depot decimated small business, 45% was your target average mark-up. Less if you were selling expensive items, a little more for cheap items. Out of that 45% mark-up came your overhead. If you ran it right you would be fine.
These days with big box competition, margns are LESS than 45 gross (and you still have to subtract your bills). It's not easy. These days, all too often, it's impossible.
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seansho
11 years ago
"Same thing with American Pickers. I haven't been watching the show closely lately, but I believe they have two storage buildings, for which rent ain't cheap, then there is a cost of van, gas, food, hotel, paying Danielle, etc. So that "50% profit" easily turns into a much smaller number."
You do realize that in all likelihood The (not about) History Channel is footing the bill for this. Its not like the two, well three annoying clowns are performing this scripted show for free.
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Ltrazordaddio
11 years ago
agreed....
"My new policy..you don't agree with what I say.. GFY and welcome to my Ignore List"
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Syn84
11 years ago
You do realize that in all likelihood The (not about) History Channel is footing the bill for this. Its not like the two, well three annoying clowns are performing this scripted show for free.
I guess they should then overpay for everything they buy from now on, right? After all, the network pays for it, so why should we even try to make the whole story believable?
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