Perceived Value versus Real Value versus Potential Value

I deal with this every day. I’d like to think that it has made me more realistic about the real value of the things I possess. Here is what I see almost daily. A person walks into my shop with an item that they perceive as having a substantial real value. Sometimes they ask me … Continue reading “Perceived Value versus Real Value versus Potential Value”

I deal with this every day. I’d like to think that it has made me more realistic about the real value of the things I possess. Here is what I see almost daily. A person walks into my shop with an item that they perceive as having a substantial real value. Sometimes they ask me for the price they see it as worth – and sometimes I say “Yes, I’d like to buy that from you and your price is fair.” This is the place where perceived value and real value meet. This is the ideal situation. I wish it was like that all the time. Real value is where money changes hands and I suppose I need to point out that this is a fluid value – it does not stay the same. As an example, the person leaves the shop and I place a price tag on the item and another person comes in and says “I like this and your price is fair, I’d like to buy it”. Again perceived value and real value have met – for the same item but at a higher price. Let’s say the buyer is also a dealer and she takes the item to her shop where she places an even higher price on it. Another person comes in and says “Hey I like this and your price is fair” and so it goes until the item is taken off the market or until a dealer has a higher perceived value than the real value of the item to anyone who sees it.This happens to me all the time too – I buy an item which I perceive to have a higher potential value than the price I am paying. It’s worth noting that until someone else agrees to pay the price I am asking, the real value remains at what I paid for it but if no one is willing to buy it, the potential value has decreased and as a result my perceived value will probably decline until I reach a real value where someone else agrees to buy it.

So, back to the first person who comes in my shop with their item. More often than not, they have an inflated sense of the perceived value and I either decline (if it seems they are not willing to lower their expectation) or I make an offer that fits with my perceived value of the item. As a dealer, my perceived value of the item is almost always lower than that of a buyer – that is how I earn living. My thought process goes something like this “I think I can sell this for X amount and Y is the amount I want to make on the item eventually – so I am willing to pay X-Y for it” Some people think it’s a simple matter of percentage for example -“I think I can sell this for $100 so I’m willing to pay $80 for it” but that’s not the case. There are other factors. If I think I can sell the item the same day – I am willing to earn less, if I think it will be harder to find a buyer than I want to pay less, and if I have to hold the item for a very long time, I am willing to pay even less. If the item is big and takes a lot of space or requires a lot of work on my part – I need to pay much less. So it is never as simple as someone asking “How much is this worth?” and me as an appraiser saying “It’s worth this much”. Does it have emotional value? Is there an interesting history to it? What is the economy doing right now? What are the current trends? What kinds of prices have such items brought in the past?

Potential value is the pie in the sky – the place where the right buyer with the right need and the right amount of money is in the right place at the right time. Most people think of their items with the highest possible potential value. i.e. Grandma was important to you so Grandma’s stuff has a lot of value – but unless you find someone who Grandma was equally important to, you will have a hard time finding a shared perceived value and a real value transaction.

In summary – real value is a monetary transaction. Perceived value is untested. Potential value is where the stars align and the item brings the highest real value possible. My 1994 Jeep Cherokee illustrates this concept well. I paid $900 for it. That’s the real value. It’s a fairly desirable model and I’ve made some improvements but also put a lot of wear and tear on it – so my perceived is a bit higher at around $1500. Finally, the potential value is the one I hope for – I’ll put an ad for around $3000 and hope that the guy who has been looking for this model happens to find my ad and have the money. Probably what will actually happen is that the actual new real value will be somewhere between $900 and $1500, but it’s always good to have hope.

The Science of Change in the Antiques and Collectibles Business

It’s no secret that what is collectible and valuable today, may well be worthless and unwanted tomorrow – but it is the other side of that coin which makes or breaks an antique dealer. I’ve written it before but it bears saying again – you don’t make money selling, you make money buying. Or, you lose money buying – which is more often the case for most people. We conducted an estate sale this weekend where that was very apparent – the lady had amassed a sizable collection of milk-glass and while I don’t know how much she paid for it, I know what the public was willing to pay for it – nothing. A few pieces sold when we dropped the prices by 75%, but most of it was boxed up and given to charity. Just a few years ago milk glass was red hot – any piece would sell for $5-$20, but now, if it isn’t a complete set or a figural piece – you are lucky to get anything for it. And I see it in antique shops all the time – the dealers are holding on, waiting for it to come back, taking it to auctions or flea markets and displaying it hopefully – and then packing it up again. Not me – that ship has sailed and I don’t expect it to return any time soon.

The business is in a funny place right now – everyone knows it. The elders had more disposable income than any generation before or since and they did what you do when you have extra money – they bought bigger houses and filled them with all kinds of things. Now they are dying and their kids, the baby boomers, are inheriting their collections and combining them with their own in their own big houses filled with nostalgic collections that always include some Kennedy newspapers, a bunch of ‘collectible’ Harley Davidson or Budweiser or Coke crap and then realizing they are getting too old to enjoy five acres of lawn or a three story house – and so they are telling themselves that they are downsizing as they put everything in storage, try to foist their crap on their Gen X or Millennial kids, and then move into an RV or cottage – it’s a great time to be in the storage business. The baby boomer stuff is among the most worthless – a generation that saved things showing how important their generation was but didn’t save anything that was actually worth a damn. They all have grandma’s steamer trunk or treadle sewing machines or grandpa’s huge radio which they think are priceless but which are actually hardly worth the weight of moving them. They generally have thrown out the valuable stuff – the old motorcycle odometers, the Rookwood pottery they thought was ugly, the folk paintings by outsider artists, grandpa’s levis, or the ultra-rare buttons that were in grandma’s sewing machine but seemed worthless. Oh, but they saved those Bob Dylan albums, they saved Elvis records by the tons, and they saved those Kennedy death books, and they saved the most worthless parts of their parent’s collections too. And the younger generations – not interested in that crap. My wife and my generations (Gen X and Millennial) like the stuff that went in the garbage – or, prefer to have nothing at all.

It’s a hard time to be an antique dealer – but a very good time to be an estate liquidator, storage provider, or professional declutterer. Of course, at some point, today’s trash is going to be tomorrow’s treasure – the hard part is that there has never been so much shit to sieve. What is going to be the most valuable thing selling in a year? It’s probably going to be whatever has been thrown away as garbage the most, what has current cultural context (for example, what shows and movies are popular), and manages to evoke feelings of hope and happiness to the generation with the most disposable income. Dora the Explorer and Spongebob Squarepants are looking pretty good – what do you think is going to turn into gold?

The World is Filled with Worthless Stuff

I bought a new blender the other day. I was excited about it. It made me happy. I looked at different models, read reviews, read the specs, and ordered it for the best price I could find online. It arrived and I removed it from the box, washed it, put it together, read the manual (because that’s what I do) and packed up my old, garage sale bought, leaky, broken in several places blender in the new box and took it to the goodwill. My thought was ‘this is still a good blender, it still works, someone might need it’. I know that in my lifetime there have been a few times I didn’t have a blender and would have welcomed one, even with a broken handle and in need of a new rubber washer. A day later, the new blender got knocked off the counter and the handle cracked (just like the old one had been). So now, the world has at least two cracked handle blenders – and when I visited the Goodwill a few days later – I saw at least 20 blenders sitting on the shelf for $6 each and no one lining up to buy them. My new blender was so affordable ($25! And New! And Shiny! And Better?) that I hadn’t bothered to check if there was a good used one available.

I think the developed world is very much like that right now. Things that used to be scarce and thus relatively expensive are now cheap and available to everyone via the internet or discount stores like Ross or Walmart. For just a few dollars more, I can buy a new blender instead of an old one. I can buy new plates and mugs for not much more than I could find them at a thrift shop for. Over the past several months, I’ve donated truckloads of plates, dishes, glassware, clothing, appliances, decor, and more to thrift shops. One day I smashed six tables of low-end glassware at my shop – it was incredibly fun and no one is going to miss any of that stuff. I pulled out three big tubs and started throwing glass into them, then I smashed it with a hammer, then I took it to the dump. I’ll bet 80% of the stuff in most thrift stores is like that. Maybe more.

Cheap jewelry that looks like real jewelry, fake leather bound books, mass produced Persian style rugs, Chinese watches, mass produced wall art, and the list goes on and on. I try very hard these days to not have any of that stuff in my shop. My shop is an antique shop, but more, I’ve tried to make it a shop that has interesting things you won’t find elsewhere – hand made copper and brass, sterling silver, rare or interesting books, fine pottery and porcelain – but still, the regular stuff just seems to pile up. And so I make trips to the Goodwill, I make trips to the flea market (where that stuff is increasingly hard to even give away), I go to the dump.

I suspect, that there will be a time in the near future – when the thrift stores will stop accepting all of this cheap stuff and you will be faced with either keeping it or paying to dispose of it at the dump.

It’s a shame that we waste our resources, our time, our money on this kind of garbage. I’m sure that if I still had my grandmothers old blender – it would still be working. I wonder if my mom still has it? Maybe I’ll ask.

Pair of Tribal Totem/Tiki Statues (probably from Solomon Islands)

I bought this pair of tiki totems which stand approx 25″ and 28″ from the Estate of Jean Fish (iconic Hollywood model and fashion designer) and actress Edna Skinner who was most famous for her role as the neighbor on the TV show Mr. Ed. Both women lived in North Bend, Oregon and traveled the world extensively during their lifetimes. These statues were bought at the first of several estate sales at their ship shaped house on the water in North Bend back in November of 2015. The agents at the sale were unable to confirm where they were from, but my hunch is they came from the Solomon Islands. My first hunch was that they were Native American, but I was told by the head of Ethnography at Bonham’s that they were not Native American. All I’m certain of is that I like them and their cowrie shell eyes. Actually, they remind me most of a piece of outsider folk art I gave to my brother a few years ago…see a picture of it at the bottom of this post when I can find it.

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L’Exposition Universelle 1889 Heliogravure

I found this in a box at the Flea Market – unfortunately, I wasn’t the first to go through the box and many of the engravings were missing. Still, it turns out that the Smithsonian only has 31 of the engravings and the truly rare part – is the manuscript and the folio binders. Extraordinary hand colored steel cut engravings printed in a limited number for the American VIP attendees of the 1889 Universal Exposition in Paris.

Edition De Luxe L’Exposition Universelle 1889 Heliogravure containing the complete text and photogravures plus 17 of the loose hand colored heliogravure/photogravure plates of selected paintings from the 1889 Paris Exposition. This De Luxe Edition was printed for Mr. D. W. Briggs of Saginaw Michigan – presumably an attendee. 6 Folio Binders – Elephant folio

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Almost 8-Foot Tall Primitive Statue – Probably Sulawesi

I bought this 7′ 9″ carved statue from a hillside estate in Eugene, Oregon. The house was filled with treasure but my car was nearly full, but somehow I found room for this. The deceased had traveled extensively in Africa, Asia, and Oceania in the 1950s and 1960s. Their daughter thought this piece came from East Africa, but given the style of carving and the peculiar stick figure composition – my guess is that it came from Sulawesi. I am asking $1200 for it – though I’ve seen similar figures sell for nearly $10k at auction. This piece is not flawless – there are several wide cracks in the head and wear on the base from careless handling at some point. Still – it is a striking figure. If someone can confirm or correct my point of origin on this – I would be grateful. Buyer will need to arrange and pay for shipping on this one. It is available to be picked up at my shop in Reedsport, Oregon.
SOLD
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8-foot sulawesi carving