Low-balling, how low is too low? - Page 4 - Jemsite
Vendors, Auction & Reseller Talk Not for posting JEM/UV ads. Not for posting dealer/broker ads. Not for advertising ebay auctions. This is to chat about resellers, various gear in question, odd items or the people selling them.

 6Likes
Reply
 
LinkBack Thread Tools Display Modes
post #46 of 57 (permalink) Old 05-03-2017, 04:40 PM
site founder 0% owner
 
jemsite's Avatar
 
Join Date: Nov 2000
Location: NJ - USA
Posts: 11,475
Reviews: 1
Re: Low-balling, how low is too low?

Lets up the attention span please...

Romanoff-ing GC axes can't sustain a legit business long term without "new sales + Service".

It would take 1 maybe 2 online aggressive buyers to knock you out of that romanoff-ing used axes biz. But you know that.
jemsite is offline  
Sponsored Links
Advertisement
 
post #47 of 57 (permalink) Old 05-03-2017, 05:09 PM
Vendor
 
Rich's Avatar
 
Join Date: Dec 2000
Location: South Jersey
Posts: 25,478
Re: Low-balling, how low is too low?

No, you are right, I don't think I could make a Vai-able business just buying GC's dopey priced guitars for resale, but if you don't think I could make a Vai-able business just selling Used guitars, you would be way off the mark. I just choose not to, because I'd rather take the slimmer margins from New than the fatter margins from Used, but far increased workload. But I do need more balance and I do need to handle more Used, I know that, I'm just distracted getting thru JEM30's to care.

And BTW, selling that EVO for $6000 was about as non Romanoff as you could be, because Mr. Roman would have it priced at $15,000. [and I actually should have priced it at $7500 because I didn't understand the awful scratching that was on the pickguard, was actually noted on several other untouched EVO's [probably early examples where they were still trying to figure out how to relic without making it look unnatural, and that was very unnatural]]
Rich is offline  
post #48 of 57 (permalink) Old 05-03-2017, 05:22 PM
site founder 0% owner
 
jemsite's Avatar
 
Join Date: Nov 2000
Location: NJ - USA
Posts: 11,475
Reviews: 1
Re: Low-balling, how low is too low?

Quote:
Originally Posted by Rich View Post
No, you are right, I don't think I could make a Vai-able business just buying GC's dopey priced guitars for resale
Yup.

Quote:
Originally Posted by Rich View Post
but if you don't think I could make a Vai-able business just selling Used guitars, you would be way off the mark.
I don't think that. You'd just need many used guitar purchases from private sellers.
jemsite is offline  
post #49 of 57 (permalink) Old 05-03-2017, 05:32 PM
Vendor
 
Rich's Avatar
 
Join Date: Dec 2000
Location: South Jersey
Posts: 25,478
Re: Low-balling, how low is too low?

Quote:
Originally Posted by Takin' a Ride View Post
Not disputing that. In fact I think I acknowledged this? What I've seen though is that as the market becomes more transparent, there are fewer deals to be had as a bigger percentage of sellers know what their product is worth. Again, I'm certain that this varies by product. So those dealers scanning eBay are banking on being the first guy to see the deal pop up and fighting all the buyers looking at the same stuff.

Also, totally conceded this point earlier. My point was that this is serving a certain niche customer (wealthy clients looking for collector items) rather than the larger market. But this brings us back to the point that Ed Roman was going to have a harder and harder time maintaining his business model if he was relying on eBay as his source for inventory.
Then is it you arguing semantics just for the sake of it?

Private is the staple of ebay, and I'm just another dealer buying wholesale, off ebay, Reverb, plenty of dealers that call and sell to me direct, as do plenty of private, add in the consignments, a Vai-able business is right there. It just doesn't fit my goals in Used right now, which would be either very special guitars with good margin [but not so special they end up in the vault!], cool guitars that sell well, with good margin, or, plain old players, with incredible margins. I'm sure you noticed what the goal is, to be a Vai-able business means having Vai-able margins, and a client base ready willing and able to purchase [and some of those are 12 years old using their paper route money, with the gracious matching amount from Mom].

Last edited by Rich; 05-03-2017 at 10:13 PM.
Rich is offline  
post #50 of 57 (permalink) Old 05-03-2017, 09:57 PM
 
Join Date: May 2008
Location: Washington, DC
Posts: 5,746
Re: Low-balling, how low is too low?

Quote:
Originally Posted by Rich View Post
There are 100's of thousands of dealers of 1000's of categories shopping ebay for inventory. It doesn't matter if it's guitars, vintage clothes, comic books, toys, cars, every category you can imagine there are several dealers of it shopping ebay for the best material with good margins.
Not disputing that. In fact I think I acknowledged this? What I've seen though is that as the market becomes more transparent, there are fewer deals to be had as a bigger percentage of sellers know what their product is worth. Again, I'm certain that this varies by product. So those dealers scanning eBay are banking on being the first guy to see the deal pop up and fighting all the buyers looking at the same stuff.
Quote:
Originally Posted by Rich View Post
Roman, for all his faults, knew 1 thing you guys ignore. There are many tiers of pricing, and absolutely, nobody was higher than Roman on more contemporary material, but he also knew, the top tier buyer, wasn't spending his time shopping on ebay. He's spending his time MAKING MONEY!.Then when he wants to scratch the acquisition itch he has a reputable dealer [or network of them] that he shops and buys from, because the last thing he has time for is to constantly shop what's passing over ebay for that rare nut that almost never appears.
Also, totally conceded this point earlier. My point was that this is serving a certain niche customer (wealthy clients looking for collector items) rather than the larger market. But this brings us back to the point that Ed Roman was going to have a harder and harder time maintaining his business model if he was relying on eBay as his source for inventory.
Takin' a Ride is offline  
post #51 of 57 (permalink) Old 05-03-2017, 10:08 PM
 
Join Date: May 2008
Location: Washington, DC
Posts: 5,746
Re: Low-balling, how low is too low?

Quote:
Originally Posted by Rich View Post
The end result of any open auction is pitting who is searching for, found, was interested in enough to track, and bid, on any given item during any given 1 week period. The typical sales results are average buyers willing to pay average prices, and are searching hard and spending lots of time to do so. [some, being more average than the rest].

Bottom line, ebay is an auction and thus is still a wholesale marketplace, where 2 privates can get together and create top tier pricing, but more often than not, you end up with typical results for a wholesale marketplace.
eBay is an auction? I challenge this point. I haven't seen many auctions for some time now. It's mostly fixed price listings which are mostly high where the seller allows offers and is fishing for some price somewhere lower that the listing. This isn't rocket science and most people have figured this out.

In fact I'd argue that at least for guitars, eBay in many cases acts as little more than a forum for free advertising. You list your guitar on eBay (10% fees), Reverb (3.5%) and Facebook and/or Craigslist (free). If someone pays your eBay price great, but if not you lure them elsewhere with lower fees and you make the same money selling at a lower price. Win-win. I'll point out that none of these other places are set up to function as auctions.

Example: PMC that is up there right now at $5200. Watch that auction. I bet the seller just ends the auction. Guy is just fishing for buyers for free. He even lists a phone number and says "please call for an in hand description".
Takin' a Ride is offline  
post #52 of 57 (permalink) Old 05-03-2017, 10:13 PM
Vendor
 
Rich's Avatar
 
Join Date: Dec 2000
Location: South Jersey
Posts: 25,478
Re: Low-balling, how low is too low?

If you did I concede you did

All dealers buy from many many sources, and ebay will always be a good one. But using Romans model, he could buy on ebay and put a 400% margin on it. Nothing effects that model but those well oiled customers of his getting more personally involved in shopping for "deals". [lower tier pricing].

Wealthy clients also play guitar and are not always looking for "collectors items" but are looking for what scratches their itch, that they may buy a new main player, or play in rotation with 50 other guitars [or 10] or may never see anything but a glass case on a wall, or the inside of it's case in perpetuity [I have to let mine out to see light every couple years, and never feed them water after midnight!].

There are some exceptions of course which are more event driven events where the buyers outnumber the dealers, for example the current car auction tours put on by Barrett and Mecum, which is more like going to the circus than a traditional auction, like R&M/Sotheby's or Bonhams. And those traditional auctions have done a very good job at targeted promotion and data collection to pull more private money to all the sales than there used to be, creating alot more sales to the end buyer instead of the trade where it usually went. The whole landscape is evolving at all times, no doubt about it, and you have to learn to adapt, or perish.
Rich is offline  
post #53 of 57 (permalink) Old 05-03-2017, 10:20 PM
Vendor
 
Rich's Avatar
 
Join Date: Dec 2000
Location: South Jersey
Posts: 25,478
Re: Low-balling, how low is too low?

Quote:
Originally Posted by Takin' a Ride View Post
eBay is an auction? I challenge this point. I haven't seen many auctions for some time now. It's mostly fixed price listings which are mostly high where the seller allows offers and is fishing for some price somewhere lower that the listing. This isn't rocket science and most people have figured this out.

In fact I'd argue that at least for guitars, eBay in many cases acts as little more than a forum for free advertising. You list your guitar on eBay (10% fees), Reverb (3.5%) and Facebook and/or Craigslist (free). If someone pays your eBay price great, but if not you lure them elsewhere with lower fees and you make the same money selling at a lower price. Win-win. I'll point out that none of these other places are set up to function as auctions.

Example: PMC that is up there right now at $5200. Watch that auction. I bet the seller just ends the auction. Guy is just fishing for buyers for free. He even lists a phone number and says "please call for an in hand description".
You can argue ebay isn't an auction, but, it is still an auction. It's just added many other selling platforms. They had to adapt just like everybody else. And there will always be those using it for advertising to try and strike an off ebay deal. There is nothing new here, it's just more popular with Reverb offering much better rates with the same checkout ability. And when Ibanez opened the gates a few years ago and allowed ebay sales in the dealer agreement [because they couldn't enforce all the violators and stay in business] now ebay is more of a marketplace for dealers listing 1000's of sku's with a myriad of ways to break MAP pricing policies. Add in all the single parts from the guitar wreckers and those private party sales start to get fewer and fewer, but only as a percentage of the whole. There are still as many listed, they're just lost in the new sea of dealer listings.
Rich is offline  
post #54 of 57 (permalink) Old 05-03-2017, 10:39 PM
Vendor
 
Rich's Avatar
 
Join Date: Dec 2000
Location: South Jersey
Posts: 25,478
Re: Low-balling, how low is too low?

BTW My rep has been pushing me relentlessly for years to sell New guitars on ebay so I have done alot of ebay sales research, constantly reviewing many dealers completed results and the conclusion is always the same. Dealers do well with accessories, effects, guitars under $500, and extremely rarely, a guitar over $1000, and even rarer is the big $3k+ sales. ELIMINATING limiteds, strictly regular production models only. Limiteds sell well on ebay, when they're the right limiteds. When they're not, they're just dead everywhere.

The only exception is, obvious pricing violations. It's easy to sell guitars on ebay when you violate your dealer agreement.

What do I not do? Accessories, effects, and any guitars under $500. And limiteds, I don't need ebay to sell, I can always sell more than I can get [except when I'm prudent and intentionally cautious and limit myself]. I've always had plans on a ? 100 SKU parts program for ebay, but the bottom line is I would only be doing it for advertising and not to sell those parts, just to increase the visibility of the site to hopeful guitar [or parts] buyers using ebay more than Google.
Rich is offline  
post #55 of 57 (permalink) Old 05-04-2017, 09:15 AM
 
Join Date: May 2008
Location: Washington, DC
Posts: 5,746
Re: Low-balling, how low is too low?

Quote:
Originally Posted by Rich View Post
All dealers buy from many many sources, and ebay will always be a good one. But using Romans model, he could buy on ebay and put a 400% margin on it. Nothing effects that model but those well oiled customers of his getting more personally involved in shopping for "deals". [lower tier pricing].

Wealthy clients also play guitar and are not always looking for "collectors items" but are looking for what scratches their itch, that they may buy a new main player, or play in rotation with 50 other guitars [or 10] or may never see anything but a glass case on a wall, or the inside of it's case in perpetuity [I have to let mine out to see light every couple years, and never feed them water after midnight!].

There are some exceptions of course which are more event driven events where the buyers outnumber the dealers, for example the current car auction tours put on by Barrett and Mecum, which is more like going to the circus than a traditional auction, like R&M/Sotheby's or Bonhams. And those traditional auctions have done a very good job at targeted promotion and data collection to pull more private money to all the sales than there used to be, creating alot more sales to the end buyer instead of the trade where it usually went. The whole landscape is evolving at all times, no doubt about it, and you have to learn to adapt, or perish.
I think we're circling the same point here. There is and always will be a market to sell hard to find items at high prices to wealthy or otherwise non-price sensitive customers who want to scratch that itch. Where we're disagreeing is whether those sales represent a niche within the market or "the market" itself? Another way to look at it is the difference between being a boutique vs a mass market dealer.

There is/was one Ed Roman. The market segment of boutique used guitar dealer gets crowded really fast.

Regarding car auctions, one thing I notice when I occasionally tune into Mecum is that the entire model relies on someone losing massive amounts of money. Nearly all the cars sell for significantly less than the sum of the restoration work. I see a lot of cars which barely cover the cost of the paint work. There is no way that can be sustainable.
Takin' a Ride is offline  
post #56 of 57 (permalink) Old 05-04-2017, 12:34 PM
Vendor
 
Rich's Avatar
 
Join Date: Dec 2000
Location: South Jersey
Posts: 25,478
Re: Low-balling, how low is too low?

That might not be what we're circling

Cars are restored for many reasons. Some to make them far more valuable and the owner makes huge money. Some for personal reasons and the owner looses huge money. In the later the owner already knew he was loosing his lunch and didn't care. It's perfectly sustainable.
Rich is offline  
post #57 of 57 (permalink) Old 05-06-2017, 03:20 AM
 
Join Date: Aug 2012
Location: Denver, CO
Posts: 872
Re: Low-balling, how low is too low?

Quote:
Originally Posted by jono View Post
Ok guys, I've seen a guitar that i want on a website. I think it's advertised way too high based on the last couple of these that sold.

Let's say the seller is advertising it at 1000 and the last two sold for 500.

I've tried offering the 500 that the others sold for, but I was rejected. How do I get this guitar without over paying?

Teach me the art of low balling...
This has been an interesting thread. There is a clear difference in perspective and approach depending on whether you want the guitar for the "guitar," or if you want the guitar to resell.

As for you buying this guitar, you will have trouble getting the best possible price without going into the store. If you emailed your offer, it is very easy for the owner to say "No." If you are in the store, with cash, you can assess the situation. Wall/floor space is valuable in "brick and mortar" stores. The more inventory a store has the more inventory they want to get rid of. Your offer of "500" is now equal to "500+floor space for another guitar+elimination of a stagnant used product." Plus, the store does not have to ship because you are there to walk out the door with it. You will have eliminated a hassle thus saving them time and money. This is just one scenario out of many possible scenario's but it is something to think about.

A low ball offer is too low if the other party does not make a counter offer, but again this is much easier to gauge in person because of how easy it is to reject low ball offers online. 4 shillings and a rooster would be a low ball offer in my opinion, but I'm from the U.K.
Formerly Given To Fly is offline  
Reply

Tags
low balling. haggling

Quick Reply
Message:
Options

Register Now



In order to be able to post messages on the Jemsite forums, you must first register.
Please enter your desired user name, your email address and other required details in the form below.

User Name:
Password
Please enter a password for your user account. Note that passwords are case-sensitive.

Password:


Confirm Password:
Email Address

IMPORTANT: You will be required to activate your account so please ensure that your email address is correct.

If you do not receive your activation check your spam folder before using the CONTACT US form (at the bottom right of each page).



Email Address:
OR

Log-in










Thread Tools
Show Printable Version Show Printable Version
Email this Page Email this Page
Display Modes
Linear Mode Linear Mode



Similar Threads
Thread Thread Starter Forum Replies Last Post
Satriani's uber low action. How low is too low & how does he bend? JS 1000 Setup. themaidenmaniac Tech: Setup, Repairs and Mods 11 07-01-2012 03:48 PM
RGA121 2nd Position Low Low? Anyone know know?% way switch problem. mattier303 Pickups & wiring 0 02-17-2011 01:04 AM
Low wattage, low gain amp Jeff Gear, Equipment, Recording & Off Topic 6 02-25-2007 08:30 PM
Low power/low wattage tube amps slugman Gear, Equipment, Recording & Off Topic 27 09-17-2006 01:17 PM
2.0 mm on 24 fret low E string is low action? Zelman Tech: Setup, Repairs and Mods 9 08-27-2003 05:05 AM

Posting Rules  
You may post new threads
You may post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On

 
For the best viewing experience please update your browser to Google Chrome