Are we ruining the secondary market?

[Tai Goo]

Hi Peter,



I agree with what you say, in theory. The reality is, and I invite everyone to stand behind a table at a show like Blade and have people walk up with every type of knife you can imagine for trade or sale.

Each of these collectors/investors have focused and bought what brought them enjoyment.

It is odd though how many take exception when tell them:

1) you're not interested in buying the knife

2) you're not interested in trading for the knife.

3) you're not interested in the knife at all.

You would be amazed at the amount of people, who just 5 minutes before thought you really knew what was going on. When you answer 1, 2 or 3 you suddenly become an idiot.

Hi Tai,

That lead into what you said about the way I say things or how I come across.

I say things the way I do (having been called "harsh" by some) to eliminate wasting time at shows on or line with knives being offered to me which have little or no interest to me. This can be for a variety of reasons.

By writing or speaking like I do, I remove all doubt as to what collectors/investors will think I might be interested in.

This is why I no longer have people bring me factory knives, knives with, brass, nickel silver, mokume, giraffe bone (although I was just offered 3 knives in trade that had giraffe bone handles...apparently he doesn't read my postings on Bladeforums), camel bone or jigged bone (except on slip joints).

So I write and speak in a very blunt manner to save both myself and the collector/investor time.

I think if they want to cuss out someone it should be the person who sold them the knife and not the person who has to tell them its not worth half of what they paid for it.

Also, I appreciate the fact that you have been involved in custom knives for 30 years. No doubt you have seen the cycles, makers, styles and materials come and go.

However, having seen it from a distance....is not the same as having lived it for 24 years (over 13 being full time).

It's like me saying I know about what it takes to forge blades, what styles will sell the best, etc. While I can say that...I have never made a knife.

This goes back to what I was saying about asking collectors asking questions with regards to the background of the person giving the suggestions.

I am impressed that you understand that the primary market feeds the secondary market and that in turn feeds the primary market.

Tai with that bit of knowledge you are ahead of 75% of your peers.

Whenever I read posts like yours I am reminded of a VERY WELL KNOWN ABS MS who walked up to Bob Neal and myself at the Blade Show several years ago. He told us someone was selling one of his knives for less than half! He further suggested that we buy it. I said to him..."why don't you buy it?" He looked at me like I had just given him a Trig problem. He replied "I make knives, I don't buy them." I said "but you could buy the knife, clean it up and sell it and make a 30-50% profit and make a good customer happy, because your delivery time is so long."

He looked at me and said "Didn't you hear me the first time...I make knives, I don't buy them."

This boys and girls is why you don't ask 99% of the knife makers out there for advice on pricing your knives.

As well you leave the selling to the professionals.

Tai, congratulations you are in the 1%.

Oh, to answer the question of many who are reading this. Yes I bought the knife. Yes I made 50%. The client went to show the maker the knife and verify everything I told him about it.

I guess the only downside to this was my client had been waiting for 4 years with nothing but what he took to be as little or no concern of his order by the maker. After he bought the knife from me...he canceled his order with that particular maker.

Had the maker done what I suggested, he could have sold the knife to our client, made 50% on his investment and kept the other order.

Tai, this is why I say it's best to leave the buying and selling in the after market to the professionals.

Les Robertson
Custom Knife Entrepreneur
www.robertsoncustomcutlery.com

Les, if you think that "making" knives is all that "makers" do, you are sadly mistaken. We are running "businesses". "Selling knives" and being on top of the primary and secondary market trends and cycles is part of the job. If you read the first post, Kevin asked for makers input, because he is smart enough to be aware of all this.

It's not so much that you come across harsh or blunt that concerns me,... but you come across as someone who is trying very hard to cover up a low self esteem. It clouds your judgment and your manner of speech,... and diminishes your input to this forum. It's your condescending tone and continual boasting that gives you away. However, this thread is not about you or I.

 

[David Schott]

It's a shame that a "VERY WELL KNOWN ABS MS" can't understand simple arithmetic that would not pose a problem for my 12 year old daughter. Sad, very sad

Remember, an ABS MS is buying blocks of wood and a bars of steel that he makes into a knives that can sell for thousands. Not many knifemakers I know have the spare change to buy their own knives at their own prices. So while, yes, a MS could buy his own knife for 500 and sell it for 1000, making a 500$ profit, but he first needs 500$ to spare and also needs to determine if that 50% profit gets washed away when he figures out how much profit vs time he is making when he starts in 60$ in materials, not $500.

 

[Don Hanson III]

A good friend and knife collector pointed out one of my knives on ebay a couple years ago. He asked what I thought about it. Well it was a small, black lip pearl / damascus folder and the worse photos I've ever seen, dark and out of focus. I told him, if he didn't want it, I would bid it up to the price it should sell for. He wanted it and got it for less than half price.

My only risk in biding, would have been, making a profit on a knife that I could have sold quick

If the seller would have contacted me, I could have at lest provided good photos. Or with little effort, got him the full price on the knife.

The seller lost big $$$ but the buyer was very happy and I'm glad for him.

 

[Don Hanson III]

Remember, an ABS MS is buying blocks of wood and a bars of steel that he makes into a knives that can sell for thousands. Not many knifemakers I know have the spare change to buy their own knives at their own prices. So while, yes, a MS could buy his own knife for 500 and sell it for 1000, making a 500$ profit, but he first needs 500$ to spare and also needs to determine if that 50% profit gets washed away when he figures out how much profit vs time he is making when he starts in 60$ in materials, not $500.

I would buy almost all of my knives back, at half price. Even if I had to borrow the money.

100% ROI is unheard of these days

 

[Jose Reyes]

If your advice is to be followed, wouldn't that mean only the "professionals" should deal with you, as your market IS the secondary market ?

With all due respect, I understand what you are saying and I acknowledge you are undoubtedly a professional, but I do feel you don't undestand those of us that have far different perspective on buying and or selling knives than your business model.

I agree with your saavy of the business, but that is where we differ...I am NOT in the knife business. It is an enjoyable hobby.

Also, I can imagine the scenario you describe at shows, and I assure you, I wouldn't be one of the types of knife owners you depicted.

If I make it to Blade, perhaps i'll stop by to introduce myself...but I won't be trying to sell you any knives!

Peter

I think Les also gets some of his knives directly from the maker at a discount, in exchange for promotion and other services, but your point is what I was getting at with my post. If only pros were doing the selling at a premium price that would probably put a damper on the secondary market, more than the regular collector taking a loss.

As far as I could tell from Les' example, an original buyer took a 50% loss, Les made the gain, his customer got a knife at the current market value and the maker maybe took a hit to his rep and lost an order. Maybe the maker got a finders fee? If the original seller was patient enough to seek out a price closer to the "market value" would there even be a story?

I agree the maker was probably better served referring the seller to one of the customers on his list, but as Anthony pointed out, sometimes the maker just isn't in the position to make the purchase. That's not to say he's an idiot along with most of his peers. In reality if it's not the makers creating the market then who is?

PS If I had waited to read the follow up posts by the makers I could have saved some time...

 

[David Schott]

I would buy almost all of my knives back, at half price. Even if I had to borrow the money.

100% ROI is unheard of these days

Indeed it is, but I was just saying the old "you need to have money to make money" applies to this situation and may have been a factor. Most artists cannot afford to buy their own work. Consider a painter who takes a 50$ canvas and creates a $5,000 work of art from it...not many of them could jump on the secondary market and begin wheeling and dealing.

 

[Don Hanson III]

Les, if you think that "making" knives is all that "makers" do, you are sadly mistaken. We are running "businesses". "Selling knives" and being on top of the primary and secondary market trends and cycles is part of the job. If you read the first post, Kevin asked for makers input, because he is smart enough to be aware of all this..

Well said, Tai. It takes a little business savvy to be a full time maker :thumbup:

I'll let Les comment on the rest of your post

 

[Don Hanson III]

Indeed it is, but I was just saying the old "you need to have money to make money" applies to this situation and may have been a factor. Most artists cannot afford to buy their own work. Consider a painter who takes a 50$ canvas and creates a $5,000 work of art from it...not many of them could jump on the secondary market and begin wheeling and dealing.

I understand, David. But to have the chance to double my money and take care of long standing orders. I would find the money

 

[Les Robertson]

Hi Peter,

If your advice is to be followed, wouldn't that mean only the "professionals" should deal with you, as your market IS the secondary market ?

With all due respect, I understand what you are saying and I acknowledge you are undoubtedly a professional, but I do feel you don't undestand those of us that have far different perspective on buying and or selling knives than your business model.

I agree with your saavy of the business, but that is where we differ...I am NOT in the knife business. It is an enjoyable hobby.

Also, I can imagine the scenario you describe at shows, and I assure you, I wouldn't be one of the types of knife owners you depicted.

If I make it to Blade, perhaps i'll stop by to introduce myself...but I won't be trying to sell you any knives!

HI Peter,

My remark about the "professionals" was a tongue-in-cheek remark to Tai saying he understands the secondary as he has been involved in custom knives for 30 years.

One of the best quotes by a soldier to come out of the Gulf War was the following.

A Infantry Sergeant First Class (E-7) with the 82nd Airborne was asked a few hours before the attack began. What he thought about the soldiers having to go and fight?

His response, "The Ambassadors and Politicians tried the best to resolve this issue. Now it is time for them to step aside and let the professionals take over."

Peter, I completely understand the collector mind set. I remember standing in line 5 hours before the Blade Show opened in 1985 in Knoxville TN...and I was still second in line!

After months of pouring through all of the catalogs (Before the internet) spending hours figuring what knives I was going to buy...not for resale...just for my collection. I had my lists made up, saved some money and I was ready to go. I have no doubt I was vibrating seconds before the doors opened. Then running to the table of the first maker on my list and getting the knife I had been planning and plotting for, for the last 6 months. Then feeling the rush of pure joy having obtained that particular custom knife.

Is this similar to mind set you think most collectors have?

I understand.

I also understand the stunning affect on a collector that selling a knife you "love" in the after market and getting very little back. Or buying a knife only to find out that you paid triple what it was really worth and you have no chance of getting even close to your money back. The good stories outweigh the bad many times over. However, I learned that I was not taking the "after market" into account with my knife purchases.

Once I included that as part of my purchase planning. I noticed that the knives I sold out of my collection went for more than I paid for them. Sometimes it was only $5 more...but it was more.

The same person who took me to my first Blade Show he and his wife came over for dinner. She made the casual comment about if I like it so much why don't you make it a business.

The next week I met with a CPA and had the tax advantages of a small business explained to me. Like so many people looking to reduce my taxes I was starting a small business.

Most of there are very few "Custom" knife only dealers out there. Predominately because it can be difficult to get "in demand" inventory. Those who are purists...became dealers because of their love of custom knives.

Don't let the "professional" facade fool you. The collector still alive inside me.

The advise I give is in most regards general. Things to look for, materials that will be preferred in the after market, etc. I do the same things at the seminars I conduct and basic knowledge and information for the collector is what is found in my book.

Im very familiar with the custom knife collector mind set

Les Robertson
Custom Knife Entrepreneur
www.robertsoncustomcutlery.com

 

[brightred]

You keep potential fakers such as Cashen and Andrews on the straight and narrow path and prevent them from slacking off and building only cosmetically pretty "Safe Queens"

yep, somebody has to keep a sharp eye on the bunch. we don't want them to "forget" HT, do we?

I might not care that much either, Hans, if my bank accounts were denominated in Euros at the moment, lol.

euros? i don't hope so!

best regards,
hans

 

[HTMD]

But to have the chance to double my money and take care of long standing orders. I would find the money

This totally makes sense. (Don - I was reading your comments and caught myself smiling when I noticed you live in Success, MO.)

I've purchased knives from makers who had bought them back from a prior owner and was glad to get them at a good price and help out the maker.

However, there was something that bothered me about it at first. Only once did a maker state clearly up front that it was a 'buy-back' knife. In one of the other cases where I was not told, I believed that it had just been made and was subsequently embarassed when I posted a picture of that knife and someone replied in the thread that it was an older knife, etc. In that case I got over my irritation because is was a great knife, confirmed by the fact that others have offered to purchase it.

I agree it may make good sense for the maker to buy back a knife and re-sell it. And it's a strategy that clearly supports the secondary market. However, I also feel like the maker has an obligation to disclose the facts. What reason might they have for not doing so?

 

[peterinct]

Les,
My comment that only the "professionals" should deal with you was also "tongue in cheek".

The point I was trying to make is that there are perhaps as many "mindsets" as there are collectors.

I know my mindset, as well as my disposable income available to spend on knives, is quite different than the primary contributors to this forum. But the knowlege available is immense and I appreciate having it as a resource.

A typical scenario for me is to look at knives (at local shows, flea markets, etc.) and if I like how it looks, how it feels in my hand and the price, I buy it.

Since spending more time here, I would say now I would take other factors into account.

Peter

 

[Les Robertson]

Hi Tai:

Les, if you think that "making" knives is all that "makers" do, you are sadly mistaken. We are running "businesses". "Selling knives" and being on top of the primary and secondary market trends and cycles is part of the job. If you read the first post, Kevin asked for makers input, because he is smart enough to be aware of all this.{QUOTE]

Kevin, is indeed a smart man.

I have no doubt that full time makers utilize some business planing. This may explain where there are so few full time makers.

I suspect you do watch the secondary market and trends. However, watching and being involved in it every day, full time are two completely different things.

Your knives are so outside the mainstream that I doubt very seriously if you have a handle and the many different markets, their main players positions, the up and commers positions, what has happened that put them in the position they are in. What knives are the hottest in the after market and why?

Tai, the same "ego" that lead you to deviate from the mainstream custom knives. Is the same 'ego" that comforts you when you watch the cycles turn year after year and it never includes you and your knives.

It's not so much that you come across harsh or blunt that concerns me,... but you come across as someone who is trying very hard to cover up a low self esteem. It clouds your judgment and your manner of speech,... and diminishes your input to this forum. It's your condescending tone and continual boasting that gives you away. However, this thread is not about you or I.

Judging by the above quote I suspect you didn't take any College Psychology courses. If you did you need to ask for a refund.

The counter to your post is that actually it is you that has low self-esteem. As you are intimidated by someone who is very good at what they do. Those who speak their mind and they back it up with both their money and their mouth.

Boasting? Do you have an example of something I have written or said that I can't back up?

If you someone says they can do something....and they can. That is stating a fact.

Only those with low self-esteem view it as boasting.

You are right this is not about us. Just curious why you think you needed to make it so?

Les Robertson
Custom Knife Entrepreneur
www.robertsoncustomcutlery.com

 

[Don Hanson III]

This totally makes sense. (Don - I was reading your comments and caught myself smiling when I noticed you live in Success, MO.)

I've purchased knives from makers who had bought them back from a prior owner and was glad to get them at a good price and help out the maker.

However, there was something that bothered me about it at first. Only once did a maker state clearly up front that it was a 'buy-back' knife. In one of the other cases where I was not told, I believed that it had just been made and was subsequently embarassed when I posted a picture of that knife and someone replied in the thread that it was an older knife, etc. In that case I got over my irritation because is was a great knife, confirmed by the fact that others have offered to purchase it.

I agree it may make good sense for the maker to buy back a knife and re-sell it. And it's a strategy that clearly supports the secondary market. However, I also feel like the maker has an obligation to disclose the facts. What reason might they have for not doing so?

Buddy, I know you are not suggesting I would do this but you bring up a very good point.

I would not think of offering a preowned knife to someone without full discloser of the facts.

I would first offer a knife to someone who has a similar piece on order and let them decide if they want this one or wait for their order.

Don H, from Success

 

[Les Robertson]

Hi Peter,

Nothing wrong with looking for knives at flea markets...I love flea markets. I go through antique stores as well and Pawn Shops as well. You never know where you will find a good knife.


When I started buying custom knives I was making $17,000 a year as an Army 2LT. So I didn't have deep pockets either.

The less disposable income you have the more homework you should do.

If you are now taking other factors into account, then your time here has been well spent.

Les Robertson
Custom Knife Entrepreneur
www.robertsoncustomcutlery.com

 

[David Schott]

Hi Tai:

Boasting? Do you have an example of something I have written or said that I can't back up?

If you someone says they can do something....and they can. That is stating a fact.

I reject job applicants all the time for "stating facts" that come off like boasting. Theres a reason for the word "bragging" even though the act of bragging might simply be stating facts. Im not taking sides, but just pointing out that stating a true fact doesn't mean that you are doing it without being boastful or a braggart.

 

[Tai Goo]

Hi Tai:

Les, if you think that "making" knives is all that "makers" do, you are sadly mistaken. We are running "businesses". "Selling knives" and being on top of the primary and secondary market trends and cycles is part of the job. If you read the first post, Kevin asked for makers input, because he is smart enough to be aware of all this.{QUOTE]

Kevin, is indeed a smart man.

I have no doubt that full time makers utilize some business planing. This may explain where there are so few full time makers.

I suspect you do watch the secondary market and trends. However, watching and being involved in it every day, full time are two completely different things.

Your knives are so outside the mainstream that I doubt very seriously if you have a handle and the many different markets, their main players positions, the up and commers positions, what has happened that put them in the position they are in. What knives are the hottest in the after market and why?

Tai, the same "ego" that lead you to deviate from the mainstream custom knives. Is the same 'ego" that comforts you when you watch the cycles turn year after year and it never includes you and your knives.



Judging by the above quote I suspect you didn't take any College Psychology courses. If you did you need to ask for a refund.

The counter to your post is that actually it is you that has low self-esteem. As you are intimidated by someone who is very good at what they do. Those who speak their mind and they back it up with both their money and their mouth.

Boasting? Do you have an example of something I have written or said that I can't back up?

If you someone says they can do something....and they can. That is stating a fact.

Only those with low self-esteem view it as boasting.

You are right this is not about us. Just curious why you think you needed to make it so?

Les Robertson
Custom Knife Entrepreneur
www.robertsoncustomcutlery.com

Hi Les,
No offence, but my business savvy tells me that full response to your post, would be a waste of my time and everyone elses. However, you may be "projecting" YOUR negative traits onto others.

Lego my ego!

 

[betzner]

In my opinion, personal attacts and responses that are also personal attacks have no place in a thread that has been posted for other reasons. This comment probably doesn't belong here either, but children DO need to be corrected at the time of infraction.

 

[Les Robertson]

Hi Tai,

No offense taken, as your assessment of me is completely wrong.

The fact that you are now talking about "projection" would indicate a basic understanding of psychology. Perhaps you have spent a little time on the "couch".

Hi Betzner:

Tai started it. LOL

Les Robertson
Custom Knife Entrepreneur
www.robertsoncustomcutlery.com

 

[Tai Goo]

Hi Tai,

No offense taken, as your assessment of me is completely wrong.

The fact that you are now talking about "projection" would indicate a basic understanding of psychology. Perhaps you have spent a little time on the "couch".

Hi Betzner:

Tai started it. LOL

Les Robertson
Custom Knife Entrepreneur
www.robertsoncustomcutlery.com

The one thing I do really like about you Les is,... you just don't give up do you?

Do you think we can quit wasting everyone's time now with our odd senses of humor and personality quirks?

I will if you will.
However, I would rather be accused of silliness,... than taking myself too seriously.

If it will make you feel any better and get a good night’s sleep, I’ll just concede the points, and let you win.

Hey! You da man!

Give the man some skin!