Two things, one is volume.....

by Otony, Wednesday, February 26, 2014, 08:50 (3866 days ago) @ Rob Leahy

........we move a tremendous number of firearms. Our rep at Davidsons informed that we are one of his largest accounts. Here is a good example, we started a new bound book last March, and filled it before the end of the year. I will have to check, but that is a significant number of guns. We average buying a minimum of $3000 to $4000 worth of guns per week.

Second, and very significantly, we are also a pawn shop. The State of Washington sets our interest rate, which is 25% on a loan. You would be shocked at the number of folks who come in and repawn on the 90th day, that is, simply pay the interest and start a new 90 day wait.

Frankly, the pawn shop end of things pays the bills, and the gunshop side is icing. We have a captive audience. As I mentioned, other than Ranch & Home, you have to drive an hour plus to reach another shop. And the boss is lenient re: late pawns. Depending on the customer, he will charge a late fee rather than keeping the item, which insures repeat business. Rare in the pawn industry.

And I never mentioned the profit margin on used guns. Guns lost in pawn cost peanuts. If a used gun is in good shape, like new, we price it a 100 bucks less than what we sell it for new. Great price for our customer, but I guarantee we are making more off of it than on a new gun.

Same, same, when the boss buys a gun from someone. The most he will give is about 60% of wholesale, and that doesn't happen often. He has no qualms about lowballing people, a practice I'm not too comfortable with, but that is the way a pawn shop runs.

Honestly, pawn shops are like heroin in some respects. A huge part of the customer base is dependent on the shop, and will never get the monkey off their back. I was hired to work the gun end of things, and try to stay with that as much as possible.

Otony