Too much aloha?

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So, is this the reason our Maui pawn shop wasn’t selected for a reality TV show? Are we too nice, too?

A Washington pawnbroker who was approached  by a show producer didn’t make the grade:

 

With TV cameras following her throughout the day, she treated Jodi Flynn and the crew to a lesson in firearms and taser use. “We all had a wonderful time together for those few days, and Jodi really enjoyed herself.”

After several days of filming, Jodi phoned Nancy informing her that Ben’s Loan wouldn’t make the cut. The official verdict: “She’s just too nice.” 

Jodi explained that while Nancy treated her customers with compassion, her staff was extremely caring and professional, and her customers love her, it’s not the sort of thing that audiences come to expect from reality television.

Coming next, “Jerry Springer: Pawn Broker”?

Big dog

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Here at Kamaaina Loan And Cash for Gold, we often brag about being Maui’s biggest pawn shop. But that’s big-frog-in-small-pond talk. DFC Global just announced it had bought a chain of pawn shops in Romania that will bring its total to  1,457.

Its press release says Romania has a long history of pawn loans, but the shops are quite small. 32 shops did a turnover of $9 million,  That’s less than $300K per shop. Even Maui’s smallest pawn shop probably does more than that.

DFC Global Corp. is a leading international diversified financial services company serving primarily unbanked and under-banked consumers who, for reasons of convenience and accessibility, purchase some or all of their financial services from the Company rather than from banks and other financial institutions.

 

Romanian pawn shops are similar to Maui pawn shops in that they primarily lend or buy gold, usually jewelry. However, they also make auto loans, which some pawn shops in America do, although not so much

 

Arizona loves to pawn

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Nationwide,  about one American in 5 uses a pawn lender to raise cash, according to the private financial regulator FINRA.

But for some reason, in Arizona it’s 1 in 4.

Old West Indian trading posts were, among much else, pawn lenders. But there couldn’t be enough trading post business to account for the difference.

Our Maui pawn shop has active accounts for around 1 in 10 Maui residents. The FINRA survey asked whether respondents had used a pawn loan in the past 5 years.

There are other pawn shops on Maui besides Kamaaina Loan, and we have some turnover in customers over 5 years, so Maui people might be close to Arizonans in using pawn.

Nationwide, there’s more pawning in the South. But that’s because most Southern states raised the ceiling on interest, not because Southerners are specially attuned to pawning.

 

 

Fair’s fair

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You may not realize it, but Hawaii law requires second-hand dealers to follow the same rules as pawnbrokers — keep records of all incoming merchandise, and of the IDs, addresses and other information about the sellers (or borrowers in the case of pawn customers).

The reason you may not know this is that island second-hand dealers routinely ignore the law and enforcement is slight. Pawnbrokers, and our Maui pawn shop for sure, follow the rules strictly.

Why not? Our owner helped write that statute decades ago.

If you think it makes little sense to require pawn shops to keep careful records to discourage fences but to allow second-hand dealers a free pass, the idea is gaining some currency. For example,  this Boston Globe story explains the outcry when police advised consignment stores — often selling expensive goods like Prada — that they, too, needed to cooperate in deterring thieves.

Reporter Beth Healey provides a good overview of the competing arguments, including one from a defense attorney about civil liberties. He’s going to lose that one.

Unusually, though, Healey ends by revealing one of the dirty little secrets of the anti-pawn shop mindset — it’s about scorning working people:

 

Goldstein [a pawnbroker] said that out of fairness, consignment stores should follow the same rules.

If stricter measures are being applied to people in less affluent neighborhoods with lower economic means, he asked, “Are they being implemented with people on Charles Street and Newbury Street?”

A pawn shop chain moves upscale

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Pawn America is one of a couple of large (for the pawn business) chains that started in the past generation. Most pawn shops, however, are still small, local and often mom-and-pop operations.

Kamaaina Loan And Cash For Gold fits the usual pattern.

This story from the St. Paul Pioneer-Press describes how Pawn America is trying to attract shoppers who have never tried a pawn shop’s retail operation by separating it from the lending operation.

Our Maui pawn shop

Brad Rixmann, pawnbroker

did that long ago. In fact, we are perhaps overseparated, with four locations along one long block of North Market Street. One for jewelry, art and curios; one for tools, fishing and golf, the pawn shop and the new store with a wide selection of stuff, from guitars and surfboards to DVDs and Hawaiian artifacts.

The Pioneer-Press story also gives a good explanation of the difficulties pawn shops face from local governing authorities who have decided — but misguided — ideas of what pawn shops are.

“Six or seven years ago, they came to the city of Inver Grove Heights and we said no,” Mayor George Tourville said. “We took a look at the issues around how they operate, and the stigma of stolen goods going right straight to the pawn shop, and we didn’t have the votes to get them into the city of Inver Grove Heights.”

 

It took a while, but eventually the hicks in Inver Grove Heights got a clue:

Police were reassured by safeguards like the Automated Pawn System, which provides law enforcement with daily computerized reports on everything the pawn shop acquires — along with photo identification of each seller. That makes it much more secure than online resale activity, where it’s easier to stay anonymous.

Only then did Inver Grove Heights discuss rewriting its pawn ordinance and changing the zoning for Pawn America.

“It was not a slam dunk,” Tourville said. But with those safeguards and the company’s strong reputation, “it allowed the city council to say, ‘Hey, this is a good thing for our community,’ ” he added. “They built a good space, they’ve got people working. That space was empty and it was filled.”

As this blog has noted many times, a pawn shop is a really stupid place for a fence to offer stolen goods. He has to leave his name, address, driver’s license (or other ID) and a thumbprint, plus be filmed by surveillance cameras.

 

 

 

 

Words we like to hear

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Kamaaina Loan blog often grouses about the difference we perceive between how we see ourselves (and other pawnshops) and how the public sees us. Basically, the unpleasant guy played by Rod Steiger in “The Pawnbroker.”

So we were pleased to see reporter Jaime O’Neill in the Chico (Calif.) News & Review go out and see for himself. He, too, started with the Rod Steiger view, as he says,

I pitched this piece thinking it would provide the opportunity to write a hard-edged slice of Oroville noir focused on pawnshops where down-and-outers went from the Indian casinos to the pawnshops to hock their dead mothers’ wedding rings for a few pennies on the dollar, hoping to get enough money to return to the casinos and feed the slots once more, chasing the chimera of winning their money back so they could make the rent.

He was surprised.

Though it may be true that such scenarios get played out somewhere in the nexus between hard times and pawnshops, that wasn’t the story I found when I sat down to interview Danielle Batha, Chris Daniels and Gary Besser before business hours on a recent Thursday morning.

Instead, he found a pretty pawnbroker selling whole mammoth tusks and $5,000 Stetsons and not too much about busted gamblers hocking rings. Rather,

“I just don’t see that as a driving force,” she said. “More often, we see customers coming in who’ve had a win and they’re looking to go shopping. It’s not all tears and sad stories,” Daniels adds. “It’s like a curio shop.”

 

It’s quite a long piece, in fact the longest story about a pawnshop we’ve ever seen in a newspaper, and bouncy and positive, so of course we liked it.

As we have observed often, all pawnshops are different.  At Kamaaina Loan, our pawnbrokers are not kept behind thick plexiglass windows like in Oroville.

“We’re putting out the message that we’re not victims, and not about to be victimized,” Daniels answered. “We want customers to know that this is a very safe and secure place, and that stuff they pawn with us will be here when they come back to get it.”

 

Lucky we live Maui. On Maui, the post office clerks also deal across an open counter. If you don’t travel, you won’t know how different things are on the Mainland.

Not everywhere, but in some places, the United States Post Office is so afraid of its customers that a sliding, bulletproof glass is raised for you to put your money through, then lowered, while a second sliding, bulletproof glass on the clerk’s side is raised for him to take it.

But the basic dealings are pretty much the same at pawnshops in the Wild West of Oroville and the mild west of Maui:

“One of the things I’ve liked about working here,” Daniels added, “is how often people are grateful for the help we’re able to offer them.”

Batha nodded. “Our women customers tend to be really sweet people,” she added. “Lots of the people we do business with are single moms trying to get to the end of the week. They’ll bring in jewelry or laptops. Sometimes it’s for just enough money to fill the gas tank.”

 

 

 

The story of a pawn shop chain

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Lots of America’s pawn shops are one-outlet businesses, but there are chains, too. Here’s a feature about a fast-growing chain in the Southeast.

We find it interesting because the interviewer asked about “the seedy reputation of the pawn business.”

Rather than pretending it doesn’t exist, more and more pawn businesses are tackling this issue in public.  (Maybe it helps that the reputation of non-fringe lenders has gotten more seedy since 2008.)

Anyhow, Robbie Whitten has a good, succinct response to that question:

We’ve been fighting negative images for years. Pawn shops can be kind of shady, but the reality TV shows have been a big boost to the industry and its reputation. Now a lot of mom-and-pop shops are cleaning up their stores to take advantage of the interest.

There are a lot of new customers coming in who say they’ve never been in a pawn shop and want to check it out. We don’t want them to feel like they’re in a pawn shop. On one side we want them to think they’re in a fine jewelry store, and in the sporting goods section we want them to think they’re in a Bass Pro shop, with a department store in between.

 

Later in the interview, Whitten says:

There are lots of guys, like real-estate agents, who were making six figures that are now living on 40 grand. They can’t borrow $3,000 or $4,000 from the bank anymore–they just don’t make those types of personal loans. The term we like to use in the industry is “underbanked.” But these people have lots of nice tangible assets. They might have a Rolex or a $500 Ping driver they can sell.

 

That’s where Kamaaina Loan gets a lot of its resale merchandise. We even have a Private Viewing Room for customers who (we think) are either embarrassed to be seen in the pawn lobby or, perhaps, don;t want to be seen making a $50,000 cash transaction.

Economists list pawn shops as “fringe banking” institutions, because they serve what Whitten calls the “underbanked.” At least a quarter of Americans don’t have an account with a commercial bank. And not all of them are wearing Rolexes.

We prefer to think of ourselves as the most democratic of all “banks.” If your income is $100,00o-plus, we’ll be happy to serve you. And if it’s $10,0o0-minus, we’ll be happy to serve you.

 

 

Parking, parking, who’s got the parking?

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North Market Street is a great place to do business in many ways, but it was even better before the county started eliminating parking spaces.

Saturday, Kamaaina Loan sent an observer out to see what more parking means for business. The locale: the Upcountry farmers market.

The market used to be held at the Eddie Tam Community Center, which has maybe a dozen parking stalls. And it used to attract about 6 vendors and perhaps two dozen customers over the course of a couple of hours every Saturday morning.

If somebody was setting up the meeting room in the center for a baby luau or birthday party, which was usually the case, there was even less parking.

Over a year ago, for reasons unrelated to parking, the market was moved to the private parking lot next to Longs at Kulamalu Town Center.

It took a while for people to get used to it, but nowadays, the farmers market draws at least 5o vendors and we don’t know how many customers. But last Saturday, the parking lot — we didn’t count, but it has probably 300-400 stalls — was full. Overfull.

People wanting to get at the locally-made jellies, just-picked avocados, fresh greens and sausage biscuits (among many other things) had to park along the access road, and the overflow of cars reached nearly to Maikalani (the offices of the Institute for Astronomy).

We cannot think of a clearer example of what you need for business stimulation.

 

 

 

 

And soon, a daily pawn show in cable TV

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America’s thirst for pawn shops shows appears to be limitless. History, truTV and TLC already produce a variety of weekly shows. Now, CMT has announced a daily show, to be called “Win or Lose Pawn.”

A publicity photo shows a palm tree, but evidently this is not going to be Hawaii’s entry in the pawn TV derby. The show is being cast in Southern California, and Television Blend reports that its producers are looking for “two sorts of people: those who are looking to pawn an item and those who simply want to get an appraisal of a, hopefully big ticket, item.”

Sounds real. That’s what happens every day in Kamaaina Loan’s pawn shop.

“Win or Lose Pawn” is being birthed by a producer known for shows such as “Shark Tank.” Television Blend, however, is skeptical:

This show is coming at the wrong end of the pawn shop phase and I only see a long, hard road ahead.

Hey, here’s an idea, Hollywood. How about a pawn shop show that instead of being concocted and staged and produced, shows what really happens in a pawn shop. We think it would be interesting. You know, not reality, but real.

Warning: Fake US silver coins flood Canada

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According to the Hamilton (Ontario) Metroland news service, police have recovered “hundreds” of fake US Silver Eagles.

Although described as “silver dollars,” the fake coins — silver and nickel plate over brass — are also described as 10 ounces in weight. That would make them bullion pieces in a coin shape, since a silver dollar weighs 1 ounce.

The release (from police) says the suspects got the coins from online auction sites, before selling them to local shops. They targeted businesses that were either busy or short-staffed, so buyers would spend less time verifying the coins’ authenticity.

At today’s prices, a 10-ounce silver “coin” has more than $220 of silver in it. So 500 fakes means the scammers hit the Canadian pawn shops for somewhere in the neighborhood of $100,000 .

The story concludes with good advice:

Police say if someone is willing to sell a coin for less than its silver value, they’re most likely trying to pass off a fake. They also warn the public to buy coins and other precious metals through reputable dealers who take the proper steps to check authenticity.

The release did not say what online auction sites were moving these “high-quality fakes, professionally manufactured by an unknown source.” But Kamaaina Loan Blog had no trouble finding a site selling purported 1-oz Eagles for less than $19. Since that coin, if real, would have more than $22 in silver in it — and would retail, in 1-coin sales, for around $30 — we are suspicious.