What Does A Pawn Shop Do Exactly?

So you want to know what a pawn shop does – great!

Pawn shops have a variety of different roles and offer a number of services to the communities they serve.

While different pawn shops can offer different services, most of them share two basic services in common.

Understanding them can make your experience in your local pawnshop much more rewarding.

2 Things You Can Do At Virtually Any Pawn Shop

It is safe to assume that no matter where you are in the world, a pawn shop will offer these two basic services.

Get Loans

The most common thing you can do at a pawn shop is get a loan on your valuable possessions.  While the types of items accepted at various pawn shops can vary considerably, most pawn shop take jewelry, diamonds, and tools.

Other types of valuables some shops might take are electronics like laptops and TV’s, musical instruments like guitars and flutes, and some pawn shops will even loan against the title of your car or boat!

Find Great Deals

The second common service that pawn shops typically offer is the ability to buy goods at a steep discount as compared to their in-store value.

The type of merchandise you can buy from a pawn shop will depend on the valuables they accept for a loan. There is a good chance that if the pawn shop loans on something – they will also have similar merchandise for sale.

That having been said, these aren’t the only services offered at some pawn shops.

What Else Can You Do At A Pawn Shop?

While not all pawn shops offer these services, some will offer you additional services. Examples are:

Check Cashing – not everyone has a checking account and a pawn shop can offer this kind of service to help their customers handle payroll, tax refund and even personal checks.

Western Union – While there are a large number of Western Union locations throughout the country, it’s not uncommon for some pawn shops to also offer it as an additional financial service to help the community they are in.

Prepaid Credit Cards – While debit cards have become very popular, not everyone has access to a bank account. To help overcome that problem many pawnshops offer the ability to establish and maintain prepaid credit cards that you can use for purchasing, bill payment, or anything else you might need a credit card for.

other services from pawn shops
Jewelry Repair is often another service that many pawn shops offer.

Jewelry Repair & Service – Typically speaking pawn shop deal with a large amount of gold, platinum and silver jewelry. They may even have certified jewelers on staff that can help identify and appraise your valuables. But in addition to that, some pawn shops offer other jewelry services just as sizing and repair of your items.

If you need something fixed, it may not be a bad idea to check out a few pawn shops in your area as they may be able to offer these services at a discount.

The Pawn Nerd’s Experience

I’ve been managing pawn shops for over 10 years at this point. In my experience most people use pawn shops to make loans on their items and later get them back. I would say that makes up about 75% or more of our business actually.

While the shop I work in doesn’t offer the extra services like Western Union, Check Cashing, or Jewelry Repair I can’t imagine those services make up a significant part of the businesses day-to-day operation unless of course they are primarily a financial service provider and the pawn business is a secondary service to that.

I do know that some pawn shops do really well retailing merchandise from their items but we aren’t involved in the retail side of the business much to speak of. To be honest, there isn’t much to sell.

Our customers redeem roughly 80% of the items they pawn. Of the 20% that isn’t redeemed, most of it is gold jewelry that later gets melted and not sold anyways.

We do accept a variety of merchandise at my store like musical instruments, laptops, iPads, jewelry, tools, etc. but typically a lot of it get’s listed on eBay anyways because of how little retail we actually do in the store.

Finding A Deal

To be honest, if you aren’t in an area with a pawn shop or if the pawn shop in your area doesn’t sell many items, check out eBay and look for sellers that are pawn shops.

Visit their stores often and see what they have listed. I know our stores lists 15-25 new items a week for sale and they are often sold at very reasonable prices – so check them out.

A good way to do that would be to search on Google using the phrase:

Site:ebay.com “pawn”

You will find quite a few pawn shops selling their goods on eBay and I have no doubt that if you look long enough, you will find some great deals.

Recap Of What a Pawn Shop Does

  • Pawn shops allow customers to make short term loans on their valuable items and get them back at a reasonable price.
  • Pawn shops also allow customers to shop and buy forfeit items at steep discounts compared to what they would pay in a store for the same item.
  • Some pawn shops offer extra financial and jewelry services depending on the location.

RECENT UPDATES

In the years since I’ve written this article, not much has changed in the pawn industry.

They still make loans on valuables every day, just like they always have. However, they are now seeing different types of merchandise than they once were.

Where previously, jewelry made up the majority if items that a pawn shop would take in, these days, it’s very electronics heavy. Just a sign of the times I would say.

WordPress junkie, music lover, and consumer of all things pizza-oriented. I’ve run pawn shops and check cashing operations for years. I developed the most successful digital marketing marketing strategy for pawn shops known to date, and flip items on eBay for fun.