Used values

[NoNickel]

I recently had a fellow answer my Cafe classified starting out by saying that his friends told him that a used instrument should be priced at 50% of its retail price, and asked me why my mandolin was so much more valuable that I thought I could get more. Am I missing something? Was this fellow misinformed or is it me? I would surely think that you don't take that much of a hit just by taking delivery. My price is 72% of the new price, and the mandolin is still basically new.

Your thoughts please.

[bradeinhorn]

highly misinformed - that is a very vague statement which may be correct for some instruments, but totally wrong for others. newness doesn't really have anything to do with it though, just market demand (newness may of course drive that, likewise condition and/or upgrades).

[sgarrity]

50% of retail works ok for Martin guitars. But it doesn't work for most mandolins. My rule of thumb is a used instrument should cost about 80% of what a new one would cost, give or take a little and depending on the market for that instrument.

[Ken Olmstead]

It is always worth what someone will pay for it AND what someone will take for it. 50% of retail is a value that a lot of mass produced items seem to go for but is by no means a template for used sales. I doubt you would turn a $25k Gilchrist for $12,500. If so...SOLD!!

[Jonathan Peck]

If you sell to a store (like guitar center) or shop, they will likely give you up to 50%. They will then turn around and sell it for up to 75%. If you sell privately, you will see the difference in your own pocket. Some instruments do hold their value and others increase in value, but as a general rule, you could start around 75% for a manufactured instrument in very good cared for and maintained condition.

[Greg H.]

It sounds like your responders friends are more used to dealing with cars than mandolins. If I bought a brand new Daley vintage model for $9,000 and two weeks later put it up for sale for $8,300 (with no dings etc.) that would seem perfectly reasonable IMHO. So, if your mandolin is in 'like new' condition then 72% of retail value seems Ok to me. The loss from buying a used instrument is predomintaly lack of warrenty, which for some people would be a major consideration.

My thinking would be leave it up. If someone wants it great. If you get no takers then you can consider dropping the price then.

[lovethemf5s]

I would say that his friends are mistaken. Maybe he should buy the instrument from his friends. Talk is cheap. I guess he had to give it a try anyway.

[Bob Perrey]

<First posting>
The 50% business is a general practice in RETAILING and basically has nothing to do with private transactions or with the real value of an instrument. The way it works is that on trade-ins, only one-quarter the retail value is offered in trade to the seller, and then the item taken in is resold at one-half the original retail value. Those percentages, by the way, are sometimes based on catalogue, or full retail price, sometimes on on actual street value. Moreover, this practice has more to do with hardware (cameras, amplifiers, and even factory electric guitars), things that theoretically wear out or break down. Hand-made wooden musical instruments may not fall into this practice at all. Consider what a Gibson mandolin cost in 1923 and what it costs today.

Bob

[chip]

I think it all depends on the individual item. If an item is hand made and has had a waiting list for years then that rule of 50% would be null and void and in fact the mandolin might even be worth more than the original price since you have to wait years and years for one.
On the other hand if you bought a new mass produced mandolin in the $600 range then the 50% rule might apply as they are so plentiful and pumped out by the 100's a month if not thousands out of the Pacific Rim. IMO

[mandroid]

List or SRP suggested retail price, is one set of numbers, street price is another set.
kind of restating Chip, ...
now the Pac Rim music gear and rapidly obsolete electronics is one thing, but the work of highly esteemed Hand crafted luthiers works of art musical instruments and the much sought after famous brands will be on an entirely different level.

[jaco]

Not trying to be cynical here, but as a previous poster said it is worth what someone is willing to pay for it. So many factors involved here it becomes very speculative. As more people are willing to pay the high dollars, the less speculative a price becomes.

[JEStanek]

It's worth what you're willing to sell it for, no less. If a potential buyer doesn't want to pay your price then let them move on! If you're unable to sell your mando at the requested price, perhaps you're too high.

If I were to sell an instrument used I would compare my used price with those seen online (Mandolin Brothers, Elderly, Mandolin Store, Cafe Classifieds, etc) and price similarly based upon condition.

Anyone can ask for a lower price, only y o u can agree to it.

Jamie

[chip]

Actually Jamie, I have to disagree with that statement of: "it's worth what your selling it for". If there's guides available showing values on particular instruments then someone has to or should equate that fact into price and value. Same with what other retailers are selling similar instruments for. If Person A is selling a JamieMandolin for $1000 and Retailer B,C,D,E and F is selling an identical JamieMandolin for $2000 then it seems that the $1000 Jamie should be worth more than what he/she are selling for. What do you think? Even though value may be subjective there are variables that should be taken into consideration when determining a market value. More than likely there is a history of that particular brand of instrument and what they have sold for on the 2nd hand market. To me that would determine worth because of past selling history...(I think I should be practicing)....

[MikeEdgerton]

I recently had a fellow answer my Cafe classified starting out by saying that his friends told him that a used instrument should be priced at 50% of its retail price, and asked me why my mandolin was so much more valuable that I thought I could get more....
I'll be honest, I wouldn't have honored the question with a reply.

[NoNickel]

Thanks for all the replies. The Cafe is the best place to get feedback, help, advice and ... well, its just the best!

[JeffD]

Even though value may be subjective there are variables that should be taken into consideration when determining a market value.
There are lots of variables that should be looked at in setting an offering price. But whether that offering price represents the theoretical 'market value' depends on whether someone is willing to pay that price.

And that crazy number, the 'worth' only makes sense as the price agreed to by both buyer and seller.

If someone is telling me that what I am selling is available elsewhere at a lower price, I have to wonder why he is even bothering to talk to me. Go and get it.

And if I have priced something at what I want to get out of it and someone buys it at that price, and it turns out it is selling elsewhere for more - I don't obsess about the money I 'might have made'. I got my price, I may not have gotten the higher price. I am happy.

[JeffD]

I'll be honest, I wouldn't have honored the question with a reply.
I am tempted to agree.

[trevor]

I'm with Shaun. We work on 80% of current new price if in as new condition.

On a trade or commission/consignment sale we give the seller 75% of that, so they get 60% of new price. We have to pay VAT (UK sales tax) out of our share (and all our other business costs including my $200 000 a year income) so we get a bit over 20%.

[boatman]

It is difficult for me to understand why a seller would "refuse to honor the question with a reply" when the query is coming from a potential buyer. Creating and maintaining dialogue is necessary in the sales process; furthermore, for the seller to have the opportunity to "explain" to a buyer the rationale for a certain pricing level is the essence of "marketing". Allowing emotion to stand in the way of a potential sale is not prudent.

[JEStanek]

Chip I understand your point and it is a good one. For me when thinning the herd, a mandolin I feel I may be willing to part with, I'll do my research and and sell it for what I feel it's worth to me. If I can't get what I want I'll hold on to it.

Jamie

[arbarnhart]

It is difficult for me to understand why a seller would "refuse to honor the question with a reply" when the query is coming from a potential buyer. Creating and maintaining dialogue is necessary in the sales process; furthermore, for the seller to have the opportunity to "explain" to a buyer the rationale for a certain pricing level is the essence of "marketing". Allowing emotion to stand in the way of a potential sale is not prudent.
Agreed. The interested party asked why the price didn't meet his expectation based on the information he had (opinions from friends). The answer may include the additional information he needs to make a better assessment. Maybe he will even go back and educate his friends.

[Brady Smith]

Personally I would never pay 75 or 80% for something used that for 20% more I could by new. Therefore I don't buy used.

[Jason Holmes]

Personally I would never pay 75 or 80% for something used that for 20% more I could by new. Therefore I don't buy used.
If it were a $200 mandolin I might agree, but then on the other hand, 20-25% taken off the new price of a luthier-built instrument could save a buyer thousands of dollars.

[bryce]

My rule of thumb is when they try to beat you down, RAISE the price. David

[sunburst]

If it were a $200 mandolin I might agree, but then on the other hand, 20-25% taken off the new price of a luthier-built instrument could save a buyer thousands of dollars.
Not to mention getting it into your hands without a long wait. Sometimes a higher used price is money well spent.

In fairness, Brady did say; "Personally I would never pay 75 or 80% for something used that for 20% more I could by new.", and that implies that he can readily get a new one.

[Ken Olmstead]

I hate the selling process. Buying is FUN! I still do it (selling) because I am a variety is the spice of life kind of guy! http://www.mandolincafe.net/iB_html/non-cgi/emoticons/biggrin.gif #To make the selling process easier, I try to let go of emotional attachment to the item and call it business from there on. Then I am not shocked when I get the anticipated low ball offer. My choice whether to continue to negotiate or not. Many times I have gotten an offer that was so low I would say "thanks for coming by." and send the hopeful buyer on his way. Then I go do some more market research to see if I am way out of line, which is pretty easy to now with all the internet sales. Everyone knows what everything is worth. Lowballing is part of the process, I am not guilty of offensive lowballing (I have a friend that does it and I am embarressed to be around when he does it BUT he has gotten some incredible bargins that way) but I always offer enough under to start negotiations and not appear to be a time waster. Personally my reply would be "Thanks for your interest but it sounds like we are too far apart on price to come together here." and send them on to the next option, which of course they have. Ultimately when I sent a folks on their way, THEY went and did some research and found that my price wasn't so far out of line and a coulpe have come back and negotiated a real price. Never hear from tire kickers a second time. Food for thought....sorry it isn't very profound. http://www.mandolincafe.net/iB_html/non-cgi/emoticons/wow.gif

[EdSherry]

In my experience, pricing mass-produced used instruments at 50% of current retail LIST is a pretty common "rule of thumb," always subject to exceptions for condition, demand, etc. #

Given that many instruments have actual retail selling prices of significantly below list (e.g., you can often get 30% off of list by asking, depending on how competitive the market is), 50% of list is about 70% of street price, which is in line with Trevor's figures.

For other instruments which sell closer to "list" price (e.g., luthiers who sell direct rarely discount their prices), the 50%-of-list "rule of thumb" is inappropriate.

In any event, as others have indicated, it's worth what it will sell for between a willing buyer and a willing seller. #Others may only want to pay an amount that's less than you're willing to accept. #Or you may want more than others are willing to pay.

Unfortunately, I see all too many uninformed sellers (e.g., on the local Craig's list) who want to get back virtually 100% of what they paid new when they sell it used, and who try to justify their pricing by referring to retail list and arguing that their used item is "just like new."

[trevor]

My figures were referring to actual selling prices. I don't usually make any adjustment for popularity of the item tho' I probably should. I have often taken a trade thinking it will be around a while and been surprised.

If I think I really can't sell it I won't take it. For a commission/consignment sale its a bit different. I will try things I think might be hard to sell and put them on my website etc., for regular customers or perhaps offer them a bit less for a trade but work with the same mark for the selling price.

I find that if I stick to the same formula, its in the FAQs on my website, folks know where they stand. I get a few who think my offer is not reasonable, then they have to sell themselves..

[Nolan]

One instrument that seems to defy the rule of thumb is the Collings MT. #If we follow the "Rule" they should be about $1175 used ($2350 retail).

[arbarnhart]

Personally I would never pay 75 or 80% for something used that for 20% more I could by new. Therefore I don't buy used.
If it were a $200 mandolin I might agree, but then on the other hand, 20-25% taken off the new price of a luthier-built instrument could save a buyer thousands of dollars.
Oddly enough, I sold my $200 mandolin right herre in the classifieds for nearly 90% after I had it for 2 years. I was very pleased with it and bragged on the sound to anyone that would listen and some that wouldn't. I offered an approval period. So the buyer had reason to believe that that particular one might be better than average and had recourse if it wasn't. I held out for that much because I had spent it getting on my Fullerton in the last round of liquidation. I have been offered more than double what I poad for the Fullerton, BTW. Rules of thumb don't work at the low end either.

[Nick Triesch]

There really are no rules. Some mandolins just re sale for more. Take Collings and Weber for instance. Both are very fine mandolins but a used Collings MF-5 will sell for closer to the new price than say a used Weber Fern. So if you really want a high price for your mandolin, a mandolin that is in great demand or more on the rare side will sell for a higher price. Over the years I have sold a Flatiron F5 Artist and a Givins A4. Both mandolins brought in a high price. Nick

[Tom C]

If I can get 50% off because an mando is used. I'd buy them all.

[Nolan]

There really are no rules. #Some mandolins just re sale for more. #
right on Nick.

Any way you look at it, it's a good investment in yourself used or new.

[MWM]

For gently used instruments, 75-80% of new (street price) is usually reasonable. Bear in mind there can be a huge difference between street price and MSRP. To put things into perspective, most folks buy Martin guitars at 40% off MSRP. So if the MSRP of a D-28 is $2850, you can probably buy it new for $1709 (street price). Figure 80% of 1709 if you decided to sell it 6 months later. That would be $1367 - 48% of the MSRP. A good retail shop might get 10% higher and a private party sale might go a little lower. Desirability and condition make a difference too.

In the mandolin market, you can keep an eye on prices here in the classifieds or through inventory of better shops. Prices are more consistent on models that are bought and sold more often. FWIW the street price on a new Colliings MT is $2050. If you sold it used 6 mos later, 80% of the price you paid would be $1640. That's about the going rate in the classifieds. A new Kentucky KM-1000 sells for $1500. I've seen a couple used ones for $1200 which is exactly 80% of new.

[arbarnhart]

Good point about disounts. My figures were versus what I paid.

[fatt-dad]

If I listed my 1920 Gibson A3, mostly original, nice case few older repairs, etc. for $2,800.00 anybody that wanted to could tell me that Elderly has sold them in the last year for $2,300.00. That just doesn't mean that's what I'm willing to sell mine for. . . . If somebody wants the mandolin and doesn't like the price, just be nice and make an offer. To say the seller is breaking some "rule" is off to a bad start and personally, I'd tell the "prospect" to go pound sand. There are just too many folks out there who are nice to work with.

On the matter of retail v. secondary market pricing, what stores do and what a private seller does just doesn't relate. If a store offers 5o cents on the retail dollar, then that's a price for convienance to the seller. If there is no rush on the part of the seller, then ask your 80 cents on the retail dollar and see what happens. Patience has paid me well in the past.

f-d

[JeffD]

It is difficult for me to understand why a seller would "refuse to honor the question with a reply" when the query is coming from a potential buyer. Creating and maintaining dialogue is necessary in the sales process; furthermore, for the seller to have the opportunity to "explain" to a buyer the rationale for a certain pricing level is the essence of "marketing". Allowing emotion to stand in the way of a potential sale is not prudent.
I guess it depends on the inflection.

If I did my homework and priced the instrument to sell, and someone made that comment to me in an honest manner, I would try and explain it to him. But it sounded more like a sarcastic comment, like "what makes your mandolin worth so much more". In that case I hope I would not reply at all, because I know I have a bad habit of being sarcastic right back. I sure would be tempted to tell him, "well the actual difference is that I have the mandolin, and you don't." I think all would agree that saying nothing in this case might be the better strategy.

http://www.mandolincafe.net/iB_html/non-cgi/emoticons/tounge.gif

We might all agree that I could never make money in retail!

[trevor]

I wasn't suggesting any rule or how others should go about their business, just saying what I do.
I assume buyers expect to pay a little bit more form a dealer than a private seller because the transaction is more secure and they can, if the dealer is reputable, be sure its had a set-up and any other questions followed up.
If reasonably local, buyers can also visit an play a selection of instruments.

[Herd]

Interesting thread. I notice a used '05 Eastman on the classifieds for more than you can buy the instrument new. I'm sure it's a great instrument - but I'd buy new and get the full warranty. Or for that matter, look for a blem/2nd and save even more.

[frankenstein]

if you want to sell ( for the most part ) i believe we all think our instrument is worth more than you WILL sell it for. i think split the difference betweem 50% & 75% around about 62 to 65 % percent is what i would consider realistic..of course i am generalizing. a private sale doesn't include the costs retailers have and you will most likely receive full payment at the time, i recently didn't sell a guitar coz the potential buyer could get the same model new $200 dollars cheaper from a retailer even though we all agreed that mine has the THE TONE.. he went for what he could afford i still have the guitar..

[John L]

"My rule of thumb is when they try to beat you down, RAISE the price. David"

You could be brushing off a tire-kicker, or an actual sale. I would politely say no-thanks and move on. If I get a lot of low-ball offers, perhaps some research is in order.

Anyone got a 1923 F-4 at 50% of new purchase price? I will go as high as 50% of 1923 full list price. http://www.mandolincafe.net/iB_html/non-cgi/emoticons/tounge.gif

[Brady Smith]

If I can get 50% off because an mando is used. I'd buy them all.
Lol...there are many I wouldn't buy if they were new and 50% off.

[Jim MacDaniel]

Interesting thread, and sort of feeds into something I've been wondering about: how an insurance company might value an instrument insured at "replacement value". Seems to me that for a luthier or factory instrument still in production, the replacement value would be easy to determine -- the actual cost of a new replacement -- but for an older instrument that is no longer in production, how would the insurance company determine its replacement value, perhaps via comparative sales as Chip suggested earlier in this thread? If so, what if there are no comparative sales to refer to for a more rare instrument?

[Nick Triesch]

The way homeowners insurance works at least here in San Diego is that you are insured for replacement value. When I was updating my policy I took two instruments, a 1980 James Goodall guitar and My 04 Weber Fern. Before I even got started my agent told me it was not nessessary to bring them in...they would be covered. We did not have to list them. He said it was a good idea to take pic or a movie of all your stuff. We have State Farm. Nick

[Nick Triesch]

To clear up my last post, Goodall and Weber still make my instruments so even if I paid $1000 for my Goodall in 1980 I would get a new Goodall Standard for say $4800. Same with the Fern. Should work for a Nugget ot a Gilchrist also. Now an antique instrument like a Loar or pre war D28 is a whole different ball game. Nick

[Michael Lewis]

The large print giveth and the small print taketh away! http://www.mandolincafe.net/iB_html/non-cgi/emoticons/wink.gif

[pager]

Then there is the magical world of 'vintage' where all of the rules go up in smoke. #In 1942, a new Martin D-18 cost $79.50. #Ok. #Take 50% off of the 'new' price, that hummer is worth $39.75. #OK. #I'll give ya $39.75 for that. #What do you mean you want $18,500?! # #http://www.mandolincafe.net/iB_html/non-cgi/emoticons/rock.gif # # #