Cash value vs Trade Value - help me understand why there is a difference

[ROGER4314]

Gun trading is an art. It's also pretty dishonest. At its worst, it's a con job.

The favorite trick is to drag out the gun value books and show you that your gun is worth XX much. The trouble is that they wholesale your trade in price, then retail their "for sale" gun price. Difference between the two values can be excessive. If they drag out the books, make sure BOTH guns are priced from the same book. Improving that profit margin is probably the reason that you see price increases on trades.

I hate to say this, but the more inclined to drag the books out, the less chance you have of making a fair trade. These guys are looking for a dumb ass who doesn't know the value of what he has. He sees the numbers in print and thinks it's a fair deal. He doesn't realize that he's being scammed.

Remember. with books and used guns....compare retail value on yours and retail value on his. Don't allow him to quote wholesale (trade in value) on yours and retail on his. It's an old scam and they hook people with it constantly.

The best way to haggle is to know what you have in your gun, decide in advance what you can live with in trading and know what his gun is worth before you offer a deal.

With FFL dealers, the rule of thumb is that they must make about 25% to even cover their overhead. If they can't make that, it's hardly worth making the deal.

My trading rules..............
I do this for fun and to learn new things. If a guy is out for blood and the deal isn't fun......walk off. Gun trading is not a blood sport and every deal doesn't need to be profitable.

Never fall in love with the gun. If the deal isn't going well, be prepared to walk off.

Flash

 

[SR9TEX]

I guess we all have are views, and every transaction/gun is different. I just seem to see more guys out there that have unreasonable trade values imo.
I have been dealing with aftermarket car parts for the last 10 years and as a frequent buyer and seller of used parts I figured things worked the same way in the used gun market lol.
Guess I have some learning to do, but hey that's why I'm here.

 

[benenglish]

It was a hypothetical example, Ben. Do i need to make it an "OBO" deal to get my point across?

No, I think I understand. Thanks.

 

[mitchntx]

I'm surprised some are this upset over having a higher trade price, it makes perfect sense to me.

Being as I started the thread, I'll respond by saying I'm not upset, just trying to wrap my head around the concept of two advertised values associated with a single item.

I can spend cash on anything I want, buy whatever gun I want in that price range or add a little more for what I really want.

A trade means you get that one particular gun (or other item), you lose options. The value of that Springfield may be $800 but I might not consider paying more than $600 for one.

I read that to say a trade means I might have to give something that has an $800 FMV for an item that has a $600 value to me and that $200 difference is the cost of doing business. Accurate?

If so ... I guess that's where you and I differ. There are way too many opportunities out there to buy or trade. Something will come along eventually. Someone mentioned that emotion has to be removed from a business deal or someone gets fleeced. I can't fathom a time I would be willing to grossly over-pay for a gun.

I am making up for my perceived value of your trade by requesting a trade if slightly higher value. Then if I decide I really want something and need real cash for it I should be able to unload the less desirable trade item relatively quickly and still have the originally desired amount of cash.

Now I think I'm getting the thought process. It all surrounds perception which isn't necessarily reality.

I see it as a transaction ... not a deal. I'm not a dealer, so I'm not concerned about "meat being left on the bone".
I'm not a collector, rather I'm a user. I buy a lot and I sell a lot. But I sell to fund the next purchase.
I don't have any safe queens ... well, I have my Dad's Llama 357, Norinco 1911 and a beat up DPS issue Remington 870 that are.
I try to transact smartly cause my pockets do have a bottom.

 

[okie556]

Although I posted earlier about not understanding or liking the difference in cash price versus trade price, some post I read did enlighten my way of thinking. At least to the point it really doesn't bother me now. I want and need $500 cash for my gun right now. If I don't get that cash, which I could immediately go spend on something else. I need a trade item of a little more value to make up for the time and effort I have to use to get my original needed $500. My new sale ad would read, sell $600 gun for $500 cash. LOL.......think I almost convinced myself!

 

[40Arpent]

I want and need $500 cash for my gun right now. If I don't get that cash, which I could immediately go spend on something else. I need a trade item of a little more value to make up for the time and effort I have to use to get my original needed $500. My new sale ad would read, sell $600 gun for $500 cash.

This is definitely one of the thought processes I was alluding to. Anyone who gets upset with that mentality just sounds like a pussy whining about how life is unfair.

 

[mitchntx]

This is definitely one of the thought processes I was alluding to. Anyone who gets upset with that mentality just sounds like a pussy whining about how life is unfair.

Or a fool, knowingly overpaying ...

 

[40Arpent]

Or a fool, knowingly overpaying ...

I don't understand how overpaying automatically classifies someone as being a fool. Sure, in some circumstances it does, but there are plenty of circumstances where paying a premium might make sense (as I stated before). Supply and demand play a large part, as does opportunity. I have happily paid a premium to get what I want, when I wanted it. I suffered no financial woes, nobody on my end was negatively impacted....so how does that make me a fool?

 

[mitchntx]

I don't understand how overpaying automatically classifies someone as being a fool. Sure, in some circumstances it does, but there are plenty of circumstances where paying a premium might make sense (as I stated before). Supply and demand play a large part, as does opportunity. I have happily paid a premium to get what I want, when I wanted it. I suffered no financial woes, nobody on my end was negatively impacted....so how does that make me a fool?

Nor do I see how not understanding that thought process makes me a whining pussy.

Seldom is there a once in a lifetime opportunity.

 

[benenglish]

I don't understand how overpaying automatically classifies someone as being a fool. Sure, in some circumstances it does, but there are plenty of circumstances where paying a premium might make sense (as I stated before).

I think those times are very rare and driven by an at least slightly irrational drive to acquire some special thing. I have knowingly overpaid for a gun 4 or 5 times in my life. 2 or 3 of those times the premium wasn't bad and I wanted the gun, so I paid a little extra.

2 times, however, I overpaid by thousands of dollars simply because the piece was unique. Specifically, I separately located both the first and last firearms of a particular type I collect. That is, I own the very first one that ever left the factory, serial 002, and the very last one, assembled from leftover parts some 20 years after the gun was discontinued as a favor from the president of the company to an Iraq war vet.

Those two firearms are unique. For truly unique items, irrational prices are sometimes the only ones available.

Come to think of it, this whole "pricing used guns" thing is pretty darn complex at times. I don't pretend to understand it all.

 

[40Arpent]

Seldom is there a once in a lifetime opportunity.

Trust me, the times I paid a premium weren't even close to being "once in a lifetime".....more like once in a given month. LOL

 

[40Arpent]

I think those times are very rare and driven by an at least slightly irrational drive to acquire some special thing. I have knowingly overpaid for a gun 4 or 5 times in my life. 2 or 3 of those times the premium wasn't bad and I wanted the gun, so I paid a little extra.

2 times, however, I overpaid by thousands of dollars simply because the piece was unique. Specifically, I separately located both the first and last firearms of a particular type I collect. That is, I own the very first one that ever left the factory, serial 002, and the very last one, assembled from leftover parts some 20 years after the gun was discontinued as a favor from the president of the company to an Iraq war vet.

Those two firearms are unique. For truly unique items, irrational prices are sometimes the only ones available.

Come to think of it, this whole "pricing used guns" thing is pretty darn complex at times. I don't pretend to understand it all.

You FOOL!!!!!!

 

[Younggun]

I've overpaid for guns.

I did it because I wanted the gun right then, I was tired of looking, and had the money.

I knew the price going in, it didn't change when the person found out I wanted it and was willing to pay more, it's a fair deal.

 

[mitchntx]

I've overpaid for guns.

I did it because I wanted the gun right then, I was tired of looking, and had the money.

I knew the price going in, it didn't change when the person found out I wanted it and was willing to pay more, it's a fair deal.

I understand that point. You want something, then you just pull the trigger.

The subtle, yet distinct difference is advertising the fact that I have an item for sale for $xxx and for trade I need something valued at $xxx+

It has nothing to do with one's willingness to overpay, or jonseing for the last 1991 on the planet or whatever.

 

[Younggun]

What if someone offered to trade you a certain value of scrap metal?

You would probably decline if the value was equal to your asking price but accept if the value was 10 times the asking price.

 

[mitchntx]

I understand that point. You want something, then you just pull the trigger.

The subtle, yet distinct difference is advertising the fact that I have an item for sale for $xxx and for trade I need something valued at $xxx+

It has nothing to do with one's willingness to overpay, or jonseing for the last 1991 on the planet or whatever.

Please reread ...

In your example, you are the tradee ... the catalyst for ANY trade starts with a trader, clearly advertising two separate values in their mind's eye.

The person willing to do whatever it takes is the tradee

 

[matefrio]

Not much to add but a story to tell.

I watched a friend of mine at a gun show find a gun, then happened to find a buyer looking for that exact gun after he made the connection he made $1k off the deal just being the middle man.

He never even purchased or sold the gun, just put the two folks together at the same show. My head spun on that one. Seller and purchaser were happy.

He was always doing those types of deals though, knew how to work and negotiate like a shark could sniff out the situations as such. Sadly he's passed on I'd have liked to have learned more.

More Detail:

Buyer: I'm looking for a special rifle xyz
My friend: I know where one is here, how much do you have to offer?
Buyer: $2,000.00 (or some amount)
My Friend: hold on.

My Friend to seller: How much for that rifle?
Seller: $1,500.00
my friend: That your best? I have a guy wanting to pay cash now.
Seller: OK, $1,000.00
My Friend: Be Right back.


My Friend to Buyer: Found one, deal still good I get the difference?
Buyer: Ya, no problem (excited)
My friend: follow me

My Friend: Let me introduce buyer to seller. Buyer has $1k, seller that still good?
Seller: Yep, sells the gun.
Buyer to my friend: Here's $1k thanks for your help.

Me: Head spinning like a top.

 

[ZX9RCAM]

It's not possible to receive the offers simultaneously. One will start speaking first or their email or other electronic communication will come in with an earlier timestamp.

You take whichever offer was received first. Of course.

Is there an alternative?

Ben, you are taking for granted that everybody is honorable.....

 

[ZX9RCAM]

The hundred dollar difference just grew a few percentage points in your last statement. LOL

Again, speaking hypothetically, there may be instances where the desire of the purchaser might be strong enough to warrant a $100 sacrifice to get the weapon offered for sale/trade. I could certainly see myself being that purchaser. Fair market value is what someone is willing to pay, and yes, there have been times when i paid a "convenience fee" to get what i want. And there are others like me in that regard.

Pete is just a "sucker", lol.....


He don't care what he pays for something if he wants it.

 

[ZX9RCAM]

I don't understand how overpaying automatically classifies someone as being a fool. Sure, in some circumstances it does, but there are plenty of circumstances where paying a premium might make sense (as I stated before). Supply and demand play a large part, as does opportunity. I have happily paid a premium to get what I want, when I wanted it. I suffered no financial woes, nobody on my end was negatively impacted....so how does that make me a fool?

I am late to this party, obviously, lol....