Collection Strategy & Economic uncertainty

Stephen F

Stephen F

Joined
Sep 28, 2003
Messages
1,235
There has been, and will continue to be, extensive discussion about two very poignant topics affecting collectors of custom knives.

  1. What to collect
  2. Impact of the world economy on collectors

I would like to relay to you my own personal experience in this matter - here for your comment and opinion.

For a number of years I was a one knife collector - not literally one knife, but certainly one type : Forged Blades of the Bowie variety, in the value range 800-1300 USD. I knew my stuff very well, but it soon became restrictive so I branched out - high end knives, hunters, slip joints, even a couple of tacticals.

Roll on a couple of years to our current difficult climate and I have found it difficult to rotate parts of my collection, but have been able to rotate other parts with relative ease.

My conclusion: For me I will now always maintain a diversified collection portfolio,it really does help to mitigate and disperse some of the economic and trend risks we all face during the repeating cycles that propel us through our short time on this earth!

I am sure some will disagree, and that is their right, but it struck me that perhaps there really may be something to this "investment strategy" bunk that some of us talk about!;););):D

....... and yes it is me, not someone hijacking my aging account!

Cheers,

Stephen
 
Good Thread Stephen :thumbup:

I have throughly missed your thought provoking and educational threads.

I will reply when I have a little more time and look forward to observing other's posts.
 
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Hi Stephen,

The world of collecting custom knives gets smaller and smaller each year. I am not speaking of numbers of collectors (this is always on the rise), I'm speaking of accessibility to information.

What ever happened to the "Buy What You Like" Club???

Your situation is and always will be an issue for collectors. The knives are fantastic in the primary market...however in the after market...not so much.

The reality of the after market is...you may have been the 1 person who liked a particular knife and thought the price was fair.

There are always numerous threads in the For Sale" forums with regards to "Spent to much at Blade...need to raise cash" or words to that affect.

It is not so much buyers remorse as it is..."That is awesome...I have to have it" or "It's a once in a life time opportunity", etc. It is getting caught up in the moment. I am as guilty of that as anyone...even now.

I think what the "World Economy" has done to the custom knife market is:

1) Almost eliminated ridiculously high premium's in the after market. With a few notable exceptions.

2) More collectors are now openly discussing their knives not selling on forums...questioning why?

3) More collectors are now at least letting the "thought" of the after market enter their collecting.

4) People are now doing more "homework" about knives, their makers and their performance in the after market and "Value Pricing." There are going to be a lot of makers talking about how bad the "economy" is, as to the reason they had such a poor Blade Show.

The economy may in fact have had an affect on their sales at the Blade Show. More than likely it is due to the "incorrect" price on the knife.

The Blade Show because it has moved from show to "event" will draw huge crowds, regardless of the economy. The difference will be how many knives will be bought.

With sales number being low for the ECCKS and the Santa Barbara show may not bode well for the sales at Blade Show.

5) Custom knives move in circles. Today the circles are smaller with the cycles being shorter. Yes, there are exceptions...kinda like judging for Ice Skating. You throw out the top and bottom scores.

The reasons for these cycles have always been makers and collectors working in concert. However, in the past many of the makers didn't live up to their end of the bargain. Getting so swamped with orders, they know they can pick and chose their customers, the knives they sell, the shows they attend, not returning phone call/Emails, etc. This works until a collector decides to move to another maker.

6) The learning curve due to the availability of training (in person, videos, on the Internet and at shows) has shortened. Subsequently, more "quality" makers exist than every before. Giving the collectors more choices. One of the choices that is being looked at "hard" is the price.

Stephen, "portfolio" is an interesting word for you to use. That is purely and "investment" word.

So back to the title of this thread...which presents a dichotomy with regards to the buying of custom knives.

If you are buying what you like...and that is the focus of your collection. Then the performance of the knives you have bought in the after market should be of no consequence to the collector. So the elimination of a knife from you collection should have no regard to what the after market is doing. After all you bought the knife because you liked it...not for its after market potential.

If you are buying knives to build a "portfolio" the process is different. This has to do with purchasing knives that have the potential if not bought outright to realize a capital gain. After all isn't that the goal of any "investment" to make money with it.

Now we have the hybrid...The Collvestor! Those who collect within a sector taking into account more factors than just " I like it".

Perhaps it is the Collvestor that will lead the way in the future for the way that knives and makers are viewed. As well the process that the Collvestor goes through with regards to their purchases.

Difficult times generally change the thought process(s) of those participating in them.
 
Really good question Stephen.

The only downside I can see to diversification of the "portfolio" is the requsite need to develop your expertise and "do your homework" in those new (to you) areas. Making smart purchases that prove to be at least safe investments within one custom subset (forged bowies, for example) is challenging enough for most. Doing the same in 4 or 5 other subsets is 4 or 5 times harder / more work.

I have never accepted "buy what you like" and "buy for investment" as mutually exclusive concepts. Which is probably why I don't venture too far and deep from forged fixed blades. They are "what I like". Spending a fair chunk of change in other areas may well provide more diverse and varied investment /resale opportunities, but if the knives themselves don't appeal to me, those purchases will never be made. Heck, there are more than a few makers I would like to see represented in my collection that currently aren't, but funds can only be spread around so far.

And just to be clear - I can and do appreciate knives of all kinds - the above should not be taken as a suggestion that knives other than forged fixed blades aren't capable of generating passionate loyalty among their purchasers and provide excellent investment results.

Roger
 
Les Robertson said:
Now we have the hybrid...The Collvestor! Those who collect within a sector taking into account more factors than just " I like it".
Click to expand...

Visually, and linguistically, "Collevestor" works better than "Collvestor", IMO.

Best Regards,

STeven Garsson
 
Hi STeven,

Visually, and linguistically, "Collevestor" works better than "Collvestor", IMO.
Click to expand...

Thank you for your contribution....what are you my college English teacher. :D

If it will help to quell the angst that many of your posts here have had lately...

Collevestor it is!
 
Les Robertson said:
Hi STeven,



Thank you for your contribution....what are you my college English teacher. :D

If it will help to quell the angst that many of your posts here have had lately...

Collevestor it is!
Click to expand...

If you don't like Collevestor, don't use it...just trying to help, sheesh:D

With the exception of my "ABS Symposium" thread, for which I make no apologies, I'm not seein' much angst, are you?

Best Regards,

STeven Garsson
 
RogerP said:
Really good question Stephen.

The only downside I can see to diversification of the "portfolio" is the requsite need to develop your expertise and "do your homework" in those new (to you) areas. Making smart purchases that prove to be at least safe investments within one custom subset (forged bowies, for example) is challenging enough for most. Doing the same in 4 or 5 other subsets is 4 or 5 times harder / more work.

I have never accepted "buy what you like" and "buy for investment" as mutually exclusive concepts. Which is probably why I don't venture too far and deep from forged fixed blades. They are "what I like". Spending a fair chunk of change in other areas may well provide more diverse and varied investment /resale opportunities, but if the knives themselves don't appeal to me, those purchases will never be made. Heck, there are more than a few makers I would like to see represented in my collection that currently aren't, but funds can only be spread around so far.

And just to be clear - I can and do appreciate knives of all kinds - the above should not be taken as a suggestion that knives other than forged fixed blades aren't capable of generating passionate loyalty among their purchasers and provide excellent investment results.

Roger
Click to expand...

I agree, and what's said pretty much aligns with my collecting strategy.

I believe if you do your homework, one can buy what you like and still have an excellent "knife investment portfolio".
 
For starters...Stephen it's good to hear from you again on this forum:thumbup:

Man I'm so relieved I finally know what I am ...... I'm a "collevestor" or in my language a "verzamelteerder" ;):D:thumbup: I will for sure put it on my next batch of business cards.

I have three subdivisions (and some odds and ends) in my collection:
1. (art) daggers
2. forged Bowies
3. forged scroll folders

I try to make myself as much acquainted with these three types as I possibly can. That's hard work but fun to do.
In retrospect I can honestly say that I always, apart from maybe the first year of collecting knives, have lived by the creed that Les described so well: "Now we have the hybrid...The Collevestor! Those who collect within a sector taking into account more factors than just " I like it"."

Marcel
 
I know, and have spoken with, at least online, a couple of participants in this thread. Looking at the mountain of stuff I have ready to go up in Trade subforums on several knife websites, and the involved photos etc, I am uncertain of what I want to keep. I have several wants already, and have really fallen out of favor with production knives. Excepting Chris Reeve and some select slipjoint companies. Other than that, I have been looking at custom bushcraft/camping knives for use only. No real thought to accumulation. I have some Gossmans on order, and plan on ordering some J Neilsons later on. I haven't even thought about custom slipjoints and "tacticools" as they are called. However, other than a few other makers, I am overwhelmed by choices. This is just for fixed blades.

Maker, type of knife, steels available. I haven't thought about resale value, because, when I am ordering, I plan on keeping these for a long time.

While I am not spending on the monetary level that you guys are, I still need some structure. I need to sit down and draft a plan, because disposable income is not an option as much as it was. I've decided for the time being, to stick with makers that I know and have bought from before. Right now, I'm focusing on small hunters and Kephart style blades. Bushcraft knives from select makers, including the aforementioned J Neilson.
 
Buy sought-after, desireable knives and there will always be a market for them. If you buy knives from makers who always have knives for sale and have to work hard to sell their knives when new, well good luck.
 
Les, that is one of the best commentaries I have seen that is so spot-on with respect to this subject - thanks.
 
Hi Anthony,

Buy sought-after, desirable knives and there will always be a market for them. If you buy knives from makers who always have knives for sale and have to work hard to sell their knives when new, well good luck.
Click to expand...

Part of my point was...define desirable!

Desirable to one collector may not be to another. You have been to the Blade Show :D

As well, just because a maker is desirable today...does not mean they will be in the future. There are numerous factors that have to be weighed.

Also, I know you are aware of many makers who early on had a table full of knives....and had to work hard to sell them. No one shows up from day one and sells out.

Think back to the makers you knew 10 years ago that you could call up and get a knife from in 4-6 weeks...who no have a 18 month wait.

15 years ago you and I were both hot on the trail of John M. Smith. Very talented knife maker who had the potential to be a leader in the forged blade community. Today he is a recluse whose work is now limited to replica's of roses in bronze.

In the 3rd part of the article I wrote for Blade on what makes knives increase in value. I pointed out that it is the collectors who have to vigilante of what the makers they have invested in are doing right or not doing. Indicators of sloppy work, poor customer service, raising prices when there is no need for it, etc. Ultimately it is up to the Collevestor to determine the optimal time to sell.
 
Collevestor ?????

...... what about Custom Knife Invellector .......
:)
Cheers,

Stephen
 
Collevestor ?????

...... what about Custom Knife Invellector .......

Cheers,

Stephen
Click to expand...

That would be a "Investmelaar":D ...... I think I stick to "Verzamelteerder" . It has a nice ring to it;):D

Marcel
 
Les Robertson said:
Hi Anthony,



Part of my point was...define desirable!

Desirable to one collector may not be to another. You have been to the Blade Show :D

As well, just because a maker is desirable today...does not mean they will be in the future. There are numerous factors that have to be weighed.

Also, I know you are aware of many makers who early on had a table full of knives....and had to work hard to sell them. No one shows up from day one and sells out.

Think back to the makers you knew 10 years ago that you could call up and get a knife from in 4-6 weeks...who no have a 18 month wait.

15 years ago you and I were both hot on the trail of John M. Smith. Very talented knife maker who had the potential to be a leader in the forged blade community. Today he is a recluse whose work is now limited to replica's of roses in bronze.

In the 3rd part of the article I wrote for Blade on what makes knives increase in value. I pointed out that it is the collectors who have to vigilante of what the makers they have invested in are doing right or not doing. Indicators of sloppy work, poor customer service, raising prices when there is no need for it, etc. Ultimately it is up to the Collevestor to determine the optimal time to sell.
Click to expand...

You are correct. It is a good time NOW to buy knives by John Smith in my opinion if you could find them for sale.

Knives are like stocks. Buy and hold doesn't always work out.
 
I'm certainly no expert, nor am I really much of a collector as many of you may know. But something someone recently said stuck in my mind and it seems pertinent to this topic.

There was a reference to 'obsessive' behaviour, and how that is necessarily part of being a collector, which I believe is probably at least partly true.

It's the 'compulsive' part that people should try to be aware of, since it is that part which is more subject to outside influences, like good deals, world events, and life in general, that leads one into rash decisions.

So, tempering any compulsions that come with one's obsession is probably a good way to avoid making decisions on buying a particular knife that lead to buyer's remorse.

I think that's a long way of saying that a good strategy is to look at where the desire to buy a knife comes from, and decide first whether that impulse is worth acting on, in the long run.

As for those who are in it for financial gain, well, I'm sure that there needs to be some tempering of the obsession as well in order to turn a profit. Cold calculation is probably the name of the game for those who make their living, or even turning a profit from time to time, buying and selling collectible knives.
 
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