EBay and FedEx team up to take on Pawn Industry

EBay and FedEx team up to take on Pawn Industry

Monday morning FedEx stores launched eBay Drop Off.  I have included pictures of the FedEx in store display signage and EBay Drop Off counter signage that FedEx has allocated to this new product offering.

How does it work? 

You bring in your item. FedEx enters in your personal eBay account name or helps you to create a new eBay account on an Apple iPad. They take some general pictures of the item and send off to eBay for free.  When eBay sells the item, the customer will get 70% of the sales price.  During the process there is some negotiating as to what the price of the item should be worth, using the selling value data eBay has. 

Sounds like a Pawnshop to me.

Even FedEx wants to be a Pawn Star.

We have been blogging about the direction of online activities since 2000 with the likes of Wal-Mart and GameStop taking slivers of the pie from the Pawn Industry. 

But this… this is a big piece of the Pawn Pie. It will be a significant hit to pawnbrokers.   

We believe UPS will follow. We believe we’ll watch the giants compete for this important market share and customer base.

Pawnbrokers will see product flow and margins erode.

Why are EBay and FedEx getting into the used merchandise business?

For one, Margin.  Pawnbroker margins are unheard of in the retail world.  If retailers could get their hands on used product efficiently they would, will, are gaining steam.  Whereas new merchandise online has limited price elasticity because the manufacture can only produce the product for a set price plus their profit, used merchandise has no bottom.

  

The online space is the perfect marketplace.  This has been the effect of many product categories on EBay and Amazon over the last 17 years.  As volume and scale increase, processes get better; resulting in squeezed margins driving out those re-sellers that have not figured out how to compete.

Mom and Pops will face sharp competition.

Why has it taken so long for EBay to get into the game?

There are businesses that have been replaced with pure online platforms. For example: Netflix.  The Pawn Business is one business that has not proven it works online.  Asking customers to loan and sell their items by sending them to a stranger isn’t easy.  That is where FedEx comes to rescue with Drop Off.

Without the brick & mortar infrastructure and network of locations the Drop Off idea is dead.  But what makes the EBay/FedEx partnership inevitably successful and powerful this time around is the shipping logistics. 

It’s a disruptive business model to the Pawn Industry.   

The Pawn Industry is heading into trouble and more is coming.  

We have reported that over the last 36 months Silicon Valley has invested $800m dollars into system platform investments opportunities focused on the re-sale of merchandise.

Why is there so much interest from Silicon Valley?

You have heard this before.  It’s the data.  But it’s also the customer.  The combination of a customer that buys and sells stuff using the internet whether online or in store is a big fat profitable customer.

We have been shouting out that the cost to acquire customers is the most important element in today’s business environment.  Pawnbrokers have been stubborn to look at this component, but are finding out that they have the most desirable customers out there.  The outsiders, our new competitors, have discovered the business drivers. The Pawn Industry enjoys big fat margins and their customers keep coming back.

Why will the consumers like this product?  Easy & Fast!

What has been learned about today’s consumer is that they want it to be easy and fast.  eBay and FedEx have figured out the easy part.  The FedEx employee told me it took less than 1 hour of training to understand what she needed to know.  My experience was you can get in and out in less than 5 minutes.  Drop it off and ride into the sunset with your receipt. Then wait for your money to hit your account.

The wait part is an important part of the consumer acceptance and adoption.  There is speculation that they will be advancing payment depending on your feedback rating.  This is disruptive business model and further attacks the Pawn Industry.

We believe that getting cash into your customers’ pocket is 70% of the equation.  This will be the only competitive advantage Pawnbrokers will have going forward.

What about law enforcement reviewing merchandise like pawnbrokers?

Technically the consumer is selling the merchandise from their account and eBay is performing a service for their 30%.  It may not be fair, legally there is no duty to report to law enforcement.

What can Pawn Brokers do?

The thousands of subscribers that read my blog, you know where I go with this. I have been shouting this out since 1998. 

You have to do something!

We have been pawnbrokers, eBay sellers, and online sellers ourselves.

We have been developing solutions into the Internet since 1999.

We have lots of proven suggestions and solutions to get you started
.

At the NPA show next week, we will be showing our new...

“Bravo 2 Ecommerce” feature FREE with No success fees!

•  Craigslist
•   Gun Broker
•   Amazon
•   eBay  

Its a great time to get started.

Come talk to us at the NPA show. We would love to discuss how Bravo can improve your business and remain successful for years to come. Booth 226. See you there!

2015 - What to expect in Pawn this year, Where is it going, Bravo and more....

Bravo has grown from a well-kept secret to an industry trend.  Our continued innovations pay dividends in the form of exponential business growth, competitive edge and previously unfathomed revenues for our users.

Many of you were hesitant to join the early adopters for fears about our shortcomings.  The doubts have been obliterated.  We stand behind our product built on passion, determination, and the commitment to our customers that remains our focus today.

With our new release and 10^th upgrade this year, we continue to streamline and add new, genuine, original, creative, and value-oriented features to the product our customers know and love.

Our platform is designed for pawnbrokers using the best technology.  It’s unprecedented.  We are the best in the business because we understand your business and we are experienced developers and pawnbrokers.  It’s a rare combination.  Our commitment to service is unparalleled and our systems are unmatched in reliability, and the result is our users are seeing extraordinary business profits.

Bravo has positioned itself as a trans-formative platform for all levels and sizes of business, from lifelong pawnbrokers looking to extend their legacies, to multi-store operators who need to expand, and large enterprises that want to scale quickly and cost effectively without the usual IT headaches.

Last year and this year you will see increased regulation and rising costs of doing business.  The Obama Health Care Act will continue to put operating pressure on your current employee count and it is becoming more and more obvious that you will either have to reduce the number of employees or gain operating leverage.  Get more productivity with the same people you currently employ or you may be forced to reduce your costs to maintain profits.  Bravo’s operating tools deliver results for the small operator that likes to do everything, and large operators that have scores of employees that need to be kept productive.

We don’t just deliver the best reports and analytics in the business; we have developed on-screen indicators that keep your employees current on what tasks are due or overdue, what new eCommerce sales need to be tended to, what customers need to be contacted, and over 18 other mission-critical store functions that can be reviewed and addressed with automation and ease.

Here is sneak peak at Bravo’s New ‘Customer 5 second Interview’.   Don’t guess what kind of customers you have. Bravo shows you exactly where they rank and what profits they are delivering.  Saying YES more comes with Bravo.

What are you doing with your data?  Are you just paying to have it stored off site and remembering to keep it secure and backed up?  What is your data doing for you? How is it working for you?  We put your data to work for you.  No more guessing what your customers are doing or how they drive profits for you.  Are they your best customer?  Know exactly where they rank.  Know if you’re seeing a profit on the merchandise purchased from each customer and the items they default on.  NO MORE GUESSING.  Welcome to Bravo’s 5 second interview, refreshed daily with each customer’s latest data.

What is pawn, where is it going, and what can you do next?

Plain and simple, Pawnbrokers are in finance and retail.  It’s not one or the other; it’s both.  Being the best in both is essential.  It’s Yin and Yang. 

Let’s start with the finance effort of pawns and buys.  In order to be the best you need Product Valuation Information.  There are many sources, and the best and most reliable is the web.  But relying on one source of information is not wise, it’s limiting. Having several sources enables you to handicap the value with more precision.  Bravo offers 3 tools to quickly utilize the 3 best search references on the web: Google, Bing and Yahoo.  Bravo automatically creates and executes the search so that you can quickly and accurately find the item you are looking for.

Lastly, you are in the used goods business, and the valuation of a used item can vary drastically depending on the condition of the item, which Bravo quantitatively classifies for over 800 item types.  This is critical to the underwriting of the proper value of used merchandise.  Bravo has 875 separate uniquely defined sets of parameters to properly evaluate each type of merchandise.  These processes are blended seamlessly into Bravo’s ultra-fast interface to streamline transactions and evaluate each and every product consistently while driving 20-40% more profit per item.

Making the task of retailing acquired merchandise faster, more efficient, and more consistent is the ultimate goal.  There are a lot of opinions on how to get here in your business.  Some like under loaning and selling for higher margin and profits.  Some prefer wholesale liquidation and scrap recycling.  There are lots of strategies here, but only the correct combination will maximize the potential in every transaction.

Bravo offers OMNI Channel distribution and liquidation.  You don’t want to be without cash to loan and have inventory sit and depreciate.  Inventory turnover is one of the most important metrics in retail.  But more importantly, it is one of the most important metrics in pawn brokering.  Bravo gives your merchandise maximum liquidity at the optimal margin, ensuring you repeatedly and reliably get the highest value for the items in your inventory.

Its your turn to run your business this year as it should be.

Give us a call.