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How do pawnshops make profits?

How do pawnshops make profits?

  • Answer:

    You take your $500 ring in and pawn it to them. They give you maybe $250 for it. You have a certain number of days to retrieve it from the pawn shop for $300. They made $50 for holding your ring for 30 days. If you don't retrieve it, they sell it for $400. and make $150 on the deal. And I'm probably being generous when I say they'll give you $250. It's probably more like $150 for the ring.

gerdef27... at Yahoo! Answers Visit the source

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Other answers

Sell things for more than they buy them. If they buy a guitar from someone for $20, then they'll sell it for $30. Or if they loan someone $200 on a diamond ring, and the person doesn't pay the loan back in the specified time, they'll put it out for sale at $250.

Katasha

Same way as everyone, buy low, sell high.

Quixotic

I have a friend that is in the biz and they are not nice on the value paid to you and are regulated to a max of 14% in Michigan on the finance charge..juice..and they will resell the item for 4 times what they paid to you at first and every 30 days lower the sale price and so on

amstarlender

INTEREST OFF OF PAWNS AND WHEN AN ITEM NOT PICKED UP AND ISNT PAID FOR {which is quite often} THE OWNER OR PAWN BROKER SELLS IT FOR USUALLY DOUBLE OFWHAT IT WAS PAWNED FOR AND SAME GOES FOR ITEMS BROUGHT IN AND SOLD.

hippie girl

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