A pawn loan is particularly suitable for bridging a short-term financial bottleneck. Provided, of course, that you have valuables that generate the necessary income. You should go to the pawnshop with realistic expectations and be prepared for setbacks. Some of the supposedly valuable gold jewelry has already turned out to be gold-plated and some “valuable” watches are imitations. In the case of heirlooms in particular, the emotional value is often higher than the actual value that the pawnbroker finally pays out. Here’s your chance to know about the Pawnbroker Sydney.
It doesn’t matter what item the customer brings to the pawnshop. It should only be suitable for resale, i.e. for resale. Jewelry is particularly popular in the pawnshop; antiques and cars are also very popular. The pawnbroker estimates the value of the object to be pledged pays the money out and draws up a pawn brokerage contract.
- After the contractually agreed maximum period usually three months the customer can now release his jewelry or family heirlooms again. To do this, he repays the loan, including interest and fees. If he is unable to raise the sum after three months, there is the option of extending the contract. However, fees will be charged again and the interest will of course continue to run.
- If the customer does not release his valuables after four months at the latest and does not extend the loan, the pawnbroker may auction the things. If the income from the auction is higher than the loan including interest and fees, the pledger receives the surplus.
The pawn shops have long lost their bad reputation. There are no shady characters meeting there to do dirty business. On the contrary: many pawn shops are located in chic shops. Most of the customers come from the middle class. The pawn loan is also popular with self-employed and freelancers who find it difficult to apply for a loan from banks in order to bridge short-term financial bottlenecks.
Founding a pawnshop: 5 tips to get you started
They keep popping up. What requirements do I have to meet? How did you do this? What lead time do I need? How much start-up capital should I have? Which insurance policies are important? What are the conditions? Do I need a police certificate? And the classic: what can you earn? This is only a small excerpt, because ultimately the questions are very similar and thus the answers usually result in the following 5 tips for founding a pawnshop:
- Find out more on the website of the Central Association of the Mortgage Lending Industry. Here you will find information about the association, its members and their locations as well as other points of contact in the real and online world.
- Read the highly recommended article in the Founder’s Encyclopedia on the business idea of the pawnshop and check carefully whether you can fulfill the points listed. In addition to this article, there are many other sources on the Internet.
- A personal discussion with the responsible contact person at the local Chamber of Industry and Commerce may provide further information.
- Check your own skills! What skills do I have? Which pawns do I want to lend cars, jewelry, watches, and electronics? Do I have the necessary specialist knowledge and can I rate the pledged goods myself? Do you have the necessary infrastructure? Which services should or should I possibly have to solve externally? Do I have a corresponding network of service providers?
- Check your own location carefully again! Are there (long-established) pawnbrokers nearby? Are they specialized in certain pledges? How big is my catchment area (also depending on the pledge)?
These considerations advantageously result in the creation of your own business plan. Long-term corporate strategy, detailed cost statements and a final opportunity or risk assessment in written form are of great help when making a start-up decision.