Pen show

[Parker51]

I agree, if a person could sell $10,000 worth of pens per show, and do so at 8 to 9 shows a year that would be significant.

 

However, I am curios as to what the capitalization would be required to have an inventory which would allow for sales of between $80,000, and $90,000 per year, how many pens this would require, what the cost of the associated cases would be, what the transportation costs would be for that volume of pens, the insurance costs, and how much time would be needed for replenishment activities.

 

If one is able to sell very high priced new (collectible) pens, then yes, it could be a significant profit center, if those capitalization costs can be kept low, and inventory can be manged to match the minimum needed for each show with replenishment between shows.

 

As an alternative, if one has extremely valuable vintage pens, then again one could have significant income from this volume of sales however, their likely would be a challenge in maintaining inventory to maintain that volume of sales. One likely would need to spend considerable time, effort, and energy to obtain inventory.

 

Most of the people I have seen at Pen shows do not sell very high priced new, or vintage pens. To sell $10,000 in pens at $250 a piece on average would mean selling 40 pens per show. It would mean locating another 320 to 360 pens a year as replacement inventory. If this very successful merchant sold 10% of there inventory at each show, then they would be carrying 400 pens in inventory at a time. If pens being sold cost the merchant half on average what they sell them for, then the merchant would have invested $50,000 in pens, an unknown amount in travel cases, about $3,000 cash to make change, and purchase replacement pens. This to generate an income before travel expenses of $40,000 to $45,000 per year. If this could be done, and only one person was involved, then yes this would be a significant ongoing business, if travel and other show expenses could be kept to under $10,000 a year.

 

I simply do not believe that in reality, that this can be done by more than at most 10% of the sellers. Except for new pens, inventory is too difficult to obtain at a price which can allow a high enough mark up to generate the above described situation. I suggest that most merchants in Vintage pens are actually not able to replace their inventories and maintain sales margins, and instead are slowly liquidating their inventory which was purchased at an earlier time when it was possible to do so.

 

In regard to new pens, there is sufficient competition that profit margins are not going to allow 100% mark up. A lower mark up, say 50% means a reduction of income on the same sales volume ($10,000 per show) to result in a maximum of $3,300 profit per show, with an increase in total unit sales. The increase in volume of sales required due to the lower mark up to generate the same hypothetical sales volume also means a directly proportional increase in inventory size, as well as an increase in working capital.

 

This is of course all highly theoretical, and a pointless discussion, as I have no actual sales figures, no inventory cost, and no fixed, or variable costs associated with transportation, and sales.

 

What I do know, is what I have witnessed. Willing sellers, and willing buyers. The sellers appear to be glad they are at the shows selling pens, and the buyers are there glad to be buying. People are happy. It looks like a hobby. Maybe some people are making significant income at it, great! I simply believe that if someone has the Capital, and skills to make a significant profit from selling pens, then they likely could make a greater profit, if profit was their reason for for being there by selling something else, somewhere else where the sales volumes are higher, and their are higher mark ups.

[david i]

I agree, if a person could sell $10,000 worth of pens per show, and do so at 8 to 9 shows a year that would be significant.

 

However, I am curios as to what the capitalization would be required to have an inventory which would allow for sales of between $80,000, and $90,000 per year, how many pens this would require, what the cost of the associated cases would be, what the transportation costs would be for that volume of pens, the insurance costs, and how much time would be needed for replenishment activities.

 

How about at one show a year? Who is to judge for others what is significant... enough?

 

If one is able to sell very high priced new (collectible) pens, then yes, it could be a significant profit center, if those capitalization costs can be kept low, and inventory can be manged to match the minimum needed for each show with replenishment between shows.

 

So you seem to be saying that starting a business is a non trivial task that requires effort.

 

I don't disagree.

 

As an alternative, if one has extremely valuable vintage pens, then again one could have significant income from this volume of sales however, their likely would be a challenge in maintaining inventory to maintain that volume of sales. One likely would need to spend considerable time, effort, and energy to obtain inventory.

 

Again, you seem to be saying that running a small business requires time and effort.

 

Is this meant to be a surprise?

 

Most of the people I have seen at Pen shows do not sell very high priced new, or vintage pens. To sell $10,000 in pens at $250 a piece on average would mean selling 40 pens per show. It would mean locating another 320 to 360 pens a year as replacement inventory. If this very successful merchant sold 10% of there inventory at each show, then they would be carrying 400 pens in inventory at a time. If pens being sold cost the merchant half on average what they sell them for, then the merchant would have invested $50,000 in pens, an unknown amount in travel cases, about $3,000 cash to make change, and purchase replacement pens. This to generate an income before travel expenses of $40,000 to $45,000 per year. If this could be done, and only one person was involved, then yes this would be a significant ongoing business, if travel and other show expenses could be kept to under $10,000 a year.

 

And... ?

 

I simply do not believe that in reality, that this can be done by more than at most 10% of the sellers. Except for new pens, inventory is too difficult to obtain at a price which can allow a high enough mark up to generate the above described situation. I suggest that most merchants in Vintage pens are actually not able to replace their inventories and maintain sales margins, and instead are slowly liquidating their inventory which was purchased at an earlier time when it was possible to do so.

 

I am willing to evaluate the books you have reviewed for those sellers you have audited.

 

I would observe that being able to liquidate one's collection purchased at an earlier time is a wonderful thing, not available in many fields where cost of entry is far higher than in pendom.

 

I note that we have not controlled yet for the goal set of any given seller never mind all the sellers.

 

I note that I solidly maintain sales margin and in the face of hundreds of pens sold per year happily grow my inventory in a structured and controlled fashion. Perhaps I am part of the 10% best sellers on earth. If so, I am honored.

 

In regard to new pens, there is sufficient competition that profit margins are not going to allow 100% mark up. A lower mark up, say 50% means a reduction of income on the same sales volume ($10,000 per show) to result in a maximum of $3,300 profit per show, with an increase in total unit sales. The increase in volume of sales required due to the lower mark up to generate the same hypothetical sales volume also means a directly proportional increase in inventory size, as well as an increase in working capital.

 

Carried to the conclusion of this line of reasoning, there are no actual pen sellers at pen shows?

 

This is of course all highly theoretical, and a pointless discussion, as I have no actual sales figures, no inventory cost, and no fixed, or variable costs associated with transportation, and sales.

 

Hmmm... conclusions absent any data.

 

What I do know, is what I have witnessed. Willing sellers, and willing buyers. The sellers appear to be glad they are at the shows selling pens, and the buyers are there glad to be buying. People are happy. It looks like a hobby. Maybe some people are making significant income at it, great! I simply believe that if someone has the Capital, and skills to make a significant profit from selling pens, then they likely could make a greater profit, if profit was their reason for for being there by selling something else, somewhere else where the sales volumes are higher, and their are higher mark ups.

 

Returning us again to the notion that there are then no pen sellers.

 

Strange. This is not what i've noticed

 

-d

Edited April 11, 2009 by david i

[david i]

$43.74 US just to get into a pen show?

 

 

er...I don't think so.

 

Bruce in Ocala, FL

 

 

Depends on what the show has to offer

 

d

 

Again, not objecting, per se, to $40 fee for the right experience, I have heard rumors this show was remarkably less expensive for a day pass.

 

regards

 

david

[nickyd]

Having just waded through this lot, I THINK I'm still looking forward to attending my first Pen Show somewhere in the the UK. I expect they mostly speak English, which will help.

 

PS-I think there's a 'split infinitive' in there,somewhere!

Edited April 20, 2009 by nickyd

[Titivillus]

[*]Certainly it is possible one had a disproportionally negative experience at a pen show. Life occurs on a bell curve. If thousands of positive/negative experiences compose the curve, then a some at either end will be outliers.

 

You've made my point better than I did. A penshow is not Nirvana

 

 

K

 

[Bill Smith]

The bottom line in pen shows is to sell. The more the better.

 

We cannot "afford" wasting our time with a foreigner who doesn't

 

speaks the lingo and (most probably) doesn't have the cash.

 

So, what's new?

 

Unless "they" know you and suck up to you (with the sole intention of selling).

 

C'est la vie.

 

Since I have been involved with the Toronto International Pen Show, I have observed that the dealers that put money down for a table or tables at my event fall into two tribes: Those who make a living from selling pens and stationary and really hard core collectors who are there for love of the hobby and to generate means to pay for it. It has been my experience both the retailer and the private dealers are some of the nicest and most knowledgeable people I have met who are passionate about pens. They no problem to take time out to answer questions because an informed customer is much more likely to spend money with that particular dealer and build a long term relationship.

 

The above attitude Snowcap posts is not representative of the dealers who participate at the Toronto show and I am happy about that.

 

I also want to thank Good Guy for the kind words.

 

[david i]

[*]Certainly it is possible one had a disproportionally negative experience at a pen show. Life occurs on a bell curve. If thousands of positive/negative experiences compose the curve, then a some at either end will be outliers.

 

You've made my point better than I did. A penshow is not Nirvana

 

 

K

 

 

That's not really my point, which is more along the lines of "grow up, get a life, suck it up, deal with it".

 

regards

 

David

[Titivillus]

[*]Certainly it is possible one had a disproportionally negative experience at a pen show. Life occurs on a bell curve. If thousands of positive/negative experiences compose the curve, then a some at either end will be outliers.

 

You've made my point better than I did. A penshow is not Nirvana

 

 

K

 

 

That's not really my point, which is more along the lines of "grow up, get a life, suck it up, deal with it".

 

regards

 

David

 

 

That's pretty much what I said. A pen show isn't perfect. You just did it in a more direct way.

 

 

K