Customs Pricing – Opinions and Views?

[A. G. Russell]

Nick,

Do you know of anything - anything - that a random individual can buy and sell without loosing money? What about a great car, say a Toyota Camry? Or a nice piece of NIB electronics? Or maybe a piece of furniture? What about a dozen roses? Or a bottle of fine whisky? A computer? Some jewelry? A nice watch?

There's a good reason why retail is a full time job. It takes hard work to find the people willing to pay for, well, anything.

(That's why I have a longstanding disagreement with Les on whether knives can be an investment. You can certainly make money buying and selling knives, but it's a job - part time or full time.)

Knifemakers should be investing in, steel, handle material, supplies.

Knife dealers should be investing in the work of makers that experience has told them will go up. For me that means, Loveless, Moran, Scagel, early Randall. Talk to Rhett Stidham and ask what he invests in. Rhett and Janie are probably more successful than the next three custom dealers put together

Collectors should be investing in the pleasure of owning the things they love. If they are buying for profit they are dealers, not collectors. Lots of my customer/collectors have become dealers over the years, people like J. W. Denton and many, many others. If you can love the knives of makers like Michael Price and Bill Scagel then your knives will always be worth more year by year.

 

[custombuff]

Joss,
All of the items that you are mentioning are also non-unique. You can get one from a dealer as easily as from another collector/consumer. With knives (and I suppose the other collectibles you mention) this may be the case for a particular maker or model, but even items you can't get from the dealer fetch less.

Where does the phenomena come from that a new knife is worth less from a collector than a dealer or maker? Does the discount come from the fact that a dealer offers some assurance of a smooth transaction? Or is it due to a lack of "fresh from the maker" feel? Probably both. But that doesn't seem to justify what people have come to expect to pay for a new knife that isn't from a hot maker.

I'm just as guilty of this as anyone, I just think it goes against the idea that you can break even in this hobby and still have the freedom to choose from a wide range of makers. Which doesn't bother me much, as I have the same view as A.G. "Collectors should be investing in the pleasure of owning the things they love."

Nick

 

[Joss]

The jewelry I'm thinking about (Reinstein & Ross) is unique, but in any case, there are a lot of "unique" knives that have a lot of potential substitutes. To just think of them as unique is unhelpful, IMHO.

 

[custombuff]

Well, what I was getting at is that for many of those items, you could get the same (or similar) from a dealer. Unique I meant only in so much as it was not widely available. Perhaps I could have phrased it better.

Nick

 

[Joss]

Unique I meant only in so much as it was not widely available.

Basic custom knives - forged bowies with wood handles, 2-slab-hunters, etc - are widely available given the size of the market (small).

 

[custombuff]

Good point.

 

[Les Robertson]

Hey AG,

Have to disagree with this:

1) "Knifemakers should be investing in, steel, handle material, supplies."

Knife makers should be investing in themselves as well. This includes marketing and using basic business principles. These business principles should include "time management". A makers ability to do this will allow them to make more knives or more artistic knives.


2) Knife dealers should be investing in the work of makers that experience has told them will go up. For me that means, Loveless, Moran, Scagel, early Randall. Talk to Rhett Stidham and ask what he invests in. Rhett and Janie are probably more successful than the next three custom dealers put together.

Knife dealers are not custom knife dealers. Knife dealers are those who sell anything with an edge. Custom Knife Dealers sell only custom knives...thats it , no watches, no semi-production, no pens, etc...only custom knives.

To wait for a maker to prove themselves as successful is what most knife dealers do. They invest in the likes of Scagel, Moran, Loveless, etc. Nothing wrong with that until the market peaks and the ROI percentage starts to decrease. We have already seen a flattening of he Moran market.

You see this strategy among many of the Internet dealers. They seem to be going after the same 25 or so makers. Only one offers a trade in policy and it is only good for 6 months and there are other stipulations to go with it. If these makers knives are such great investments...why don't they offer to take them back in trade 2, 3 or 4 years into the future? If they are so great surely their work will only go up. The fact they do not stand behind these makers work shows that at best these makers are a house of cards that no one supports.

Any Financial Advisor will tell you that Long Term is the way to invest. Fortunately for you, you are at an age where you came up with the very makers you are recommending (except Scagel). Now the names you mention are at best short term investments.

What custom knife dealers look for is the new up can coming maker. Those makers who show potential for the long term. For me it was makers like Kit Carson, Walter Brend, George Herron and Jerry Fisk...they seem to have done ok over the last 20+ years.

3) Collectors should be investing in the pleasure of owning the things they love. If they are buying for profit they are dealers, not collectors. Lots of my customer/collectors have become dealers over the years, people like J. W. Denton and many, many others.

Collectors should be investors in the pleasure of owning things they love. That is a salesman's way of saying " Its a great knife by a great maker...but don't expect me to take it back for what you paid for it."

That is last centuries way of doing business in custom knives. I can't speak for the knife market, although I agree with you most of those knives aren't worth the money you pay for them. Hell most custom knives aren't worth what you pay for them.

While most dealers start out as collectors (I know I did). Collectors looking for their knives to hold their value or go up, while may be a new concept to many collectors. I hear more and more collectors at least considering that in their decision to purchase a knife.

As you know I encourage my clients to do their homework and buy knives that will hold their value. I purchase knives the same way...as unlike every other dealer out there except Bob Neal, I stand behind every knife I sell.

Imagine how the custom knife world would change if every dealer out there did that! Value pricing, core business principles and viewing knives as investments (even if ever so slightly) would change the mind set of makers and collectors. There is always a movement by some group of makers to "Reach outside the custom knife market" and find new customers.

You want all the customers you can stand implement this: Value pricing, core business principles and viewing knives as investments. Both in the maker and the knife.

If you provide a commodity that offers the above, investors will find you!

3A)"If you can love the knives of makers like Michael Price and Bill Scagel then your knives will always be worth more year by year."

Michael Price and Bill Scagel...LOL. Great knives but tough for a guy looking for something under $10,000.00! "If they are buying for profit they are dealers, not collectors." AG do you really think people who are buying knives from these makers are not looking at them as an investment? So the buyers of these knives are going to become dealers?

AG, I guess we just look at the market from two different schools of thought.

Old School vs New School.

Eventually the New School will become Old School as new ideas and information delivery methods will constantly evolve.

WWG

 

[Kevin Jones]

Nick,

Do you know of anything - anything - that a random individual can buy and sell without loosing money? What about a great car, say a Toyota Camry? Or a nice piece of NIB electronics? Or maybe a piece of furniture? What about a dozen roses? Or a bottle of fine whisky? A computer? Some jewelry? A nice watch?

There's a good reason why retail is a full time job. It takes hard work to find the people willing to pay for, well, anything.

(That's why I have a longstanding disagreement with Les on whether knives can be an investment. You can certainly make money buying and selling knives, but it's a job - part time or full time.)

Joss, just because you don't choose to buy knives that can later be sold at a profit, or can't collect knives without losing money, don't discourage others. Especially new collectors, because it can be done, and does not have to be like work. There are collectors on this forum that make or will make money (when they sell) on custom knives.

Do you know how many millions of dollars have been make in collector cars over the last 15 years?

Go to some of the major classic cars auctions and tell the collectors that are speechless as they just made thousands on cars they have owned less than two years that you can't buy something and re-sell it for a profit.

And Joss, Toyota Camary (though fine cars) are not he cars I'm talking about. Just like there are many custom knives you don't make money on.
I decided yesterday to be more subduded in my responces, however it's hard when some are so negitive.

 

[Kohai999]

Joss, just because you don't choose to buy knives that can later be sold at a profit, or can't collect knives without losing money, don't discourage others. Especially new collectors, because it can be done, and does not have to be like work.

Kevin, you don't know Joss that much, and I do.....it is just another perspective.

Joss sells knives, and he makes a profit. He doesn't turn knives the way that you do, and he might not enjoy doing so, but he does it. Probably has the finest Don Fogg collection in the country, just like you with your Fisks.

Yes, you can make money at selling knives, I know that I do. I ALSO know that I would be lucky if I broke even on the bottom 1/3 of my collection, it is just that the top 1/3 is so strong that it is sort a "can't lose" unless the bottom drops out of everything.

I have more experience buying and selling knives than you and Joss combined, because I did it professionally for over 5 years, week after week, and you both have valid points and observations.

Is Joss highly pessimistic at times? Yes, and that is OK, it is better than unchecked exhuberance.

Best Regards,

STeven Garsson

 

[Kevin Jones]

Kevin, you don't know Joss that much, and I do.....it is just another perspective.

Joss sells knives, and he makes a profit. He doesn't turn knives the way that you do, and he might not enjoy doing so, but he does it. Probably has the finest Don Fogg collection in the country, just like you with your Fisks.

Yes, you can make money at selling knives, I know that I do. I ALSO know that I would be lucky if I broke even on the bottom 1/3 of my collection, it is just that the top 1/3 is so strong that it is sort a "can't lose" unless the bottom drops out of everything.

I have more experience buying and selling knives than you and Joss combined, because I did it professionally for over 5 years, week after week, and you both have valid points and observations.

Is Joss highly pessimistic at times? Yes, and that is OK, it is better than unchecked exhuberance.

Best Regards,

STeven Garsson

Not OK IMO, as collectors, especially NEW collectors need accurate information NOT doom and gloom.

And yes you do have more experience than me, MUCH MORE, I admit I’m a relative newbie here. But don't discount my 30 years experience in collecting classic cars its relative just larger scale.

 

[Kevin Jones]

The "low key" relaxed thing just doesn't work for me, I guess.

 

[ryan9977]

what i struggle with when buying customs is how they are going to do in the aftermarket if i ever sell them....i collect knives from makers that i like and i only collect knives i enjoy the styles of....but you can't help thinking.....in 10 years is this gonna be worthless or the next bill moran......i don't have any plans on selling any of my collection now but i guess you never know.....ryan

 

[Kevin Jones]

Collectors should be investing in the pleasure of owning the things they love. If they are buying for profit they are dealers, not collectors.

I buy what I like but resale for profit sure does enter into it.

Where is it written that collectors have to lose money?

The secret to a great collection is profiting on your way to getting there.

 

[Kohai999]

Not OK IMO, as collectors, especially NEW collectors need accurate information NOT doom and gloom.

And yes you do have more experience than me, MUCH MORE, I admit I’m a relative newbie here. But don't discount my 30 years experience in collecting classic cars its relative just larger scale.

PTGDVC spelled it out in another post, education costs dearly, and not everyone getting educated is aware that they are paying.

Not only have I been collecting knives longer, but have brought in some serious collectors to the table, and don't you be getting all high and mighty on me, my friend.

We all bring something to the table....if you don't like Joss's attitude, you are free to say that, and you are, but I am here to tell you that his perspective is accurate and fair, just as yours is, it is just different.

NEW collectors need to know that they can have fun, and the sky is the limit as far as learning, but it isn't all sunshine and light, and they can get bilked and screwed, just as easily as they can have a supremely fun and profitable time.

Jack Crain, anyone??

Best Regards,

STeven Garsson

 

[John T Wylie Jr]

for those that use a custom knife daily , does it bother you to use it ?

so much talk of investment , who is actually using them as a KNIFE ?

a friend was telling me how great this knife was he had , how great it handles , etc , etc , I asked him how the edge holding was , and he responded with " oh , I haven't ever actually used it ".. to then I asked " well how do you KNOW that is a great knife ? It might be contructed well from quality materials , but until it cuts , to me it just aint a knife "...

 

[Kevin Jones]

PTGDVC spelled it out in another post, education costs dearly, and not everyone getting educated is aware that they are paying.

Not only have I been collecting knives longer, but have brought in some serious collectors to the table, and don't you be getting all high and mighty on me, my friend.

We all bring something to the table....if you don't like Joss's attitude, you are free to say that, and you are, but I am here to tell you that his perspective is accurate and fair, just as yours is, it is just different.

NEW collectors need to know that they can have fun, and the sky is the limit as far as learning, but it isn't all sunshine and light, and they can get bilked and screwed, just as easily as they can have a supremely fun and profitable time.

Jack Crain, anyone??

Best Regards,

STeven Garsson

Me getting high and mighty? You are the one that started spoutting off about how much more experence you have that Joss and I.

Yes, education does cost dearly, but where I come from if you can save someone a little, or keep them from getting bilked and screwed you put a hand out. And I thought that's what we do here.

And I don't think Joss's perspective towards custombuff was accurate or fair.

I don't see where you have a dog in this fight anyway?

What's really bothering you?

 

[Kevin Jones]

for those that use a custom knife daily , does it bother you to use it ?

so much talk of investment , who is actually using them as a KNIFE ?

a friend was telling me how great this knife was he had , how great it handles , etc , etc , I asked him how the edge holding was , and he responded with " oh , I haven't ever actually used it ".. to then I asked " well how do you KNOW that is a great knife ? It might be contructed well from quality materials , but until it cuts , to me it just aint a knife "...

I don't use most of my customs. However I know they cut great as I have the scars to prove it just from handling them.

 

[Kohai999]

And I don't think Joss's perspective towards custombuff was accurate or fair.

I don't see where you have a dog in this fight anyway?

What's really bothering you?

You are my friend, Joss is my friend, and you are jumping on him for something that I don't agree with, or about.

I think that between the two of you, maybe the true picture emerges...that is all.

That is also why I played the time in rate card...not to rub your nose in it, but to remind you that this is a long haul proposition for many of us. A real close friend of mine has been collecting knives since the '60's, before I was born. He is real salty. He says ANYONE looking to make a profit out of their knives is a dealer-collector, instead of a pure collector, with a bit of sadness in his voice.

Best Regards,

STeven Garsson

 

[Keith Montgomery]

I think if you take the time to learn about the makers, it is unlikely that you are going to have a bad experience with one of them. The problem is that many new collectors don't do that. They see a knife they like and without looking into the reputation of the maker, they go ahead and order, and put doen a large deposit, or pay in full upfront for a knife they are never going to get. It would sure be great if they educated themselves before they spent that money. Trying to help new collectors avoid the pitfalls is something that those of us that have experience be willing to go out of our way to do. I don't think that new collectors have to learn the hard way, when they can learn the smart way.

 

[Kohai999]

Trying to help new collectors avoid the pitfalls is something that those of us that have experience be willing to go out of our way to do. I don't think that new collectors have to learn the hard way, when they can learn the smart way.

I only have a problem helping new "collectors" when they are actually "investors" looking to make a quick buck and move on. Have no problem with collectors being opportunistic, but I like to know that they are in it for the long haul first.

Best Regards,

STeven Garsson