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

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  • mitchntx

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    I see a lot of ads across the ole interweb offering guns for sale that have a cash asking price and then "trade value" that is sometimes 20% more than the cash value.

    I don't understand why there are two values associated with a single item.

    We all know that if you trade cars at a dealership and they offer you $100 for you car, they've jacked the purchase price $75.
    Why not just establish value and be done instead of playing what can appear to be shady games?

    What am I missing?
     

    ArmyZach

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    I'm not sure.
    Maybe "My used stuff is better than your used stuff" kind of philosophy.
    Or a "cash is king" mentality.

    Sent from my SAMSUNG-SGH-I747 using Tapatalk
     

    Anger

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    I see a lot of ads across the ole interweb offering guns for sale that have a cash asking price and then "trade value" that is sometimes 20% more than the cash value.

    I don't understand why there are two values associated with a single item.

    We all know that if you trade cars at a dealership and they offer you $100 for you car, they've jacked the purchase price $75.
    Why not just establish value and be done instead of playing what can appear to be shady games?

    What am I missing?

    I always thought it was a pre-emptive move against fellow trader's unrealistically high trade values (heck, for sale values) on used equipment. Heck, people all the time ask more than new street value for used equipment.
     

    mitchntx

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    I always thought it was a pre-emptive move against fellow trader's unrealistically high trade values (heck, for sale values) on used equipment. Heck, people all the time ask more than new street value for used equipment.

    True statement there.

    But seldom do they advertise the new retail price and the ridiculous used price.
     

    Mikeinhistory

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    I always ask for above what I expect by a little. I assume there will be some haggling involved when I sell a firearm. Also, for trades, a lot of the time I am looking to "trade up" so I ask for things worth more, but I always specify that I am willing to add cash to the transaction.

    I have more experience with "collector" firearms and in that arena people are often apt to ask for the absolute maximum price they can find it going for anywhere. If one example of it went once for $1,000 they will ask that for their rusted out tomato stake. Lol.
     

    Charlie

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    I'm more understanding about varying prices on "collector" guns, especially the older models. Prices for a 20 to 30 yr. old gun are , IMO, based on condition, rarity, and how bad the buyer thinks he "needs" that particular gun. It should be quite different than selling "LNIB" modern guns.
     

    mitchntx

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    Not disagreeing at all, but a seller can ask whatever they like for an item just as a buyer can offer whatever they like. I don't understand why folks takes either so personally, but that's a different thread ...

    My head scratching comes from advertising two seperat values for a single item. I don't see the marketing strategy there.
     

    Charlie

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    Not disagreeing at all, but a seller can ask whatever they like for an item just as a buyer can offer whatever they like. I don't understand why folks takes either so personally, but that's a different thread ...

    My head scratching comes from advertising two seperat values for a single item. I don't see the marketing strategy there.
    Absolutely correct and I too have noticed people get very sensitive about something they want to get rid of. I personally don't care if somebody "lowballs" me with a price, I just respond with a polite no thanks.
     

    mitchntx

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    I could offer a few head scratchers ...

    A low-ball offer is deemed an insult
    A seller or buyer backs out of a deal and the other party got screwed
    Rare couldn't mean it was a POS and didn't sell, it means it is a collector's item due to low production numbers
    Excellent condition is a relative term
     

    Charlie

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    The "no forms" thing to me is pretty much meaningless since I don't plan to commit any crimes with it and my FFL is a friend and doesn't charge me. I wonder if everyone realizes that the "form" stays with the FFL and never gets questioned by the BATFE unless they have a serial number to reference and track down the last owner to inquire about the gun.
     

    reddog

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    If its a private sale no forms.

    Sorry that may be of value to the criminal or the tin foil hat wearers, but that would be the very last "good" reason for a used price to be higher than a readily available new price IMO.

    Mitchntx,
    Could it be, and this is just a guess to answer your original question, cash vs. trade, the owners perception that a trader is coming to the table with a used item that he is probably going to be holding out for more than what he would take in cash for the item. So to even the playing field the owner has his trade price to open the door to better haggling... Just a guess, who knows what really goes through the minds of some people...
     

    benenglish

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    I have more experience with "collector" firearms and in that arena people are often apt to ask for the absolute maximum price they can find it going for anywhere.
    +1

    I have a 60-year old pistol that's very rare. It's in good shootable condition with a replacement stock and Fjestad himself appraised it for me at $450. It would have been $250-300 with the original stock but the replacement was an elaborately customized piece that, in a turnabout of normal, actually increased the value. A mint, factory-original sample would be worth maybe $600, maximum.

    I saw a mint, factory-original for sale a few months back. The asking price was $4000.

    Yes, people ask the absolute maximum but I disagree with the notion that they consistently find comparables before setting a price. I think many, many prices on collectible firearms are set by just making up numbers out of thin air. Actually, outside of the mainstream items like SAAs where there are constant auction results from which to work, it's my belief that most prices on collectible firearms are essentially randomly set somewhere on the high side of "I wonder what a complete idiot would pay?"
     

    mikeofcontex

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    The seller offers at whatever price he wishes with whatever description he offers. The buyer offers whatever price he wants and analyzes the description based on his own experience. Seldom is the seller attempting to give the buyer a good deal. That's just the way it is. So... buyer beware.
     

    Mikeinhistory

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    +1

    I have a 60-year old pistol that's very rare. It's in good shootable condition with a replacement stock and Fjestad himself appraised it for me at $450. It would have been $250-300 with the original stock but the replacement was an elaborately customized piece that, in a turnabout of normal, actually increased the value. A mint, factory-original sample would be worth maybe $600, maximum.

    I saw a mint, factory-original for sale a few months back. The asking price was $4000.

    Yes, people ask the absolute maximum but I disagree with the notion that they consistently find comparables before setting a price. I think many, many prices on collectible firearms are set by just making up numbers out of thin air. Actually, outside of the mainstream items like SAAs where there are constant auction results from which to work, it's my belief that most prices on collectible firearms are essentially randomly set somewhere on the high side of "I wonder what a complete idiot would pay?"


    As far as collectible firearms I believe you are partly correct. I have come in contact with many people who say "Well on Gunbroker I saw it go for ..." whatever crazy price as justification for their pricing. I think a lot of people buy them, hold on to them for a year or so and then expect to get a return from it as soon as possible. I don't believe it's like "speculating" per se, but a lot of people think since the gun is old and prices are always rising it MUST be worth a lot more than they paid originally. Another thing is the outrageous claims made by some sellers and complete lack of self education on the part of buyers. Daily there are ads on Gunbroker or Armslist that make me cringe, not just at the price, but the amount of mis-information or possibly downright lies of the seller. As someone else said, "Seldom is the seller attempting to give the buyer a good deal... So buyer beware." That is the only real defense.
     
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