The Professional Pawnbroker: An Interview with Sam Shocket
It's been said that the only two certainties in life are death and taxes. But for pawnbrokers, a third certainty could be added to that list: the need to stay professional at all times. Pawnbrokers operate in a unique industry, and as such, they must always conduct themselves with the utmost professionalism. In an interview with a pawnbroker with over 40 years of experience, Sam Shocket, President of King's Jewelry & Loan, offers some valuable insight into how to stay in business and maintain a professional reputation.
What distinguishes a professional pawnbroker who takes his profession seriously and who is growing a company?
Professional pawnbrokers know and comply with the laws that govern the industry.
Pawnbroking is heavily regulated, so it’s important to know the ins and outs of the business and stay up-to-date on all the changes. If you choose to cut corners, you should know what the liabilities are and don't take unreasonable risks.
Professional pawnbrokers are legitimate.
If you are NOT legitimate, 2 things can happen:
1. You are not bankable.
You will not be able to go to a lending institution and get an interest rate that is affordable. And if you're not bankable, you cut corners. If you steal from yourself, your employees can steal from you.
Sam explained the latter part where he just recently had an employee who left to go to one of his competitors. He was paying her $24/hour. She returned three months later. She informed Sam that his competition was paying her $25 per hour, which he did not mind. She also informed him that she was getting paid $10 per hour and $15 under the table! His competitor was clearly attempting to save money on workers' comp, taxes, and other expenses.
Why is this a problem? That's the next point...
2. You're held hostage to your employees.
If he was paying her under the table and something went wrong, for example, she became ill, she would file for workers' compensation. However, the workers' compensation would argue that she is only receiving $10 per hour. But she'll argue, "No, I'm getting $25 per hour" to which the IRS will pay a finder's fee. You wouldn't want to be held hostage to such an arrangement!
That's why it's important and a wiser move to report and pay your taxes.
"My father used to always say…
Pay your taxes so you can sleep well at night."
– Yigal A.
Professional pawnbrokers treat the public correctly.
"I am there to satisfy the community's needs for a financial institution when they can't normally get a loan in the bank in 5 or 10 minutes...we're here to meet a need...If you treat the community right and provide good products and services, you will make money."
– Sam Shocket
Be honest with your customers. Pawnbrokers build trust with their customers by being upfront and honest about everything, from prices to the appraisal process.
Treat everyone with respect. Pawnbrokers are in the business of helping people, so it’s important to treat every customer with dignity and respect, regardless of how much money they have or what they’re looking to pawn.
In a nutshell, do not take advantage of customers!
Professional pawnbrokers know how to deal with customers.
It's critical to consider the customer's viewpoint. If the customer has a poor impression of your company, apologize for any inconvenience or unpleasant encounter they had while doing business with you.
If a customer is happy with your service, take the time to let them know that you appreciate their business.
Sam's store provides excellent customer care, and one of the ways he demonstrated it was by providing contracts, receipts, and other paperwork in two languages for customers who don't speak English as their native language!
Sam provided a useful list of incredible ways pawnbrokers can up their game when it comes to serving their customers. If you want a copy or just want to send Sam a message, you can email him at sam@kingspawn.com
Why should pawnbrokers be professional?
The answer is simple: because it's the right thing to do. Pawnbrokers should be professional for the same reason that any other business owner should be professional - to ensure that customers have a positive experience and stay in business!
Pawnbrokers who are professional provide their customers with the respect and convenience they deserve, which keeps them coming back. Pawnbrokers who are not professional risk turning their customers into one-time shoppers, or worse - driving them away entirely.
Do you have any questions for Sam or Yigal? Leave them in the comments below!
Yigal Adato
Yigal is a 3rd generation pawn broker, and is now a mentor, coach and educator with the pawnbroking industry.
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