Depreciation?

[nicholasyeo]

I think fountain pens are kinda like cars.

 

I know that if I spend $$$ on a luxury, high-performance vehicle, I will never get my money back when/if I sell it. However, I would enjoy driving it. On the other hand, if I'm worried about cash flow, then I would just purchase a relatively cheap little runabout car, right? Better resale value, and less cash to lose.

 

Now, it kind of is silly for the buyer to have purchased and not used it enough,

because it still sells for the same price, used or unused. Thank god it didn't

cost 24K! HEHE... And no, Mont Blanc pens are not bad. Any other pen can be alike.

I guess it is a combination of factors that result in this.

Edited April 10, 2010 by nicholasyeo

[nicholasyeo]

I like to buy from the boutiques because I put an emphasis on being an original owner. I substantiate this increase in cost over preowned pens because I intend to own the pen for life and I plan to use it nearly daily. A 1,000 USD pen over, hopefully, 30 years is something that appeals to me.

 

Also, if no one buys from the boutiques, then there really isn't any profit motive for the company. Someone has to do it.

 

Wow, you do have an unconventional way of thinking, not seen in most other people.

This isn't necessarily a bad thing.

[nicholasyeo]

WHAT ARE WE TRULY PAYING FOR? I guess it is the branding and marketing...

 

Sigh. If you don't understand it by now, after owning a few on their pens, you never will. If MB pens are as bad you've outline in your original post, we (MB owners) must all be fools that have too much money. No company that makes utter rubbish could survive in today's competitive luxury market. I guess the ultimate determinant of worth is why you bought a MB pen in the first place. Care to share with us your reasons for buying several MBs?

 

My reasons in no particular order: excellent customer service, gorgeous classic design, easy to obtain repairs if necessary, reliability, self manufactured nibs, heritage, and the fact that it writes nicely. Concern about depreciation: 0%. They're all keepers!

 

PRAG

 

I have to agree when you praise their service. They really do make it easy to fix and replace parts.

[goodguy]

Not sure why you put Montblanc on a pedestal, why not mention other high end pen makers who have the same problem if not worst.

How much is a Montegrappa Extra worth used ?

Aurora Nobile LE used ?

Delta Israel 60 Special LE ?

Omas Paragon (new style) ?

 

All these pens are loosing MORE then 50% of their value.

I can give you a long list of other good high end pens.

 

Montblanc WE pens usually are loosing less then other pens in their price range and usually you can buy them for roughly the same price bought new and in few occasions they went up in value like

 

1.Hemingway

2.Agatha

3.Wilde

 

My rule of thumb is never buy new MB unless its a LE model.

They are very common pens, easily available and once bought used keep a solid value so I always buy my MB used and advise people to do the same.

I find them to be very reliable (if not the most reliable).

If you choose to buy them new thats your right but you should know they are just like any other pen maker out there in regards to their regular edition models.

[professionaldilettante]

Pens make bad investments anyways, so what does this matter? It's like running into a religious institution and saying to the people, your religion is bad because of this this and this. No one is going to buy it anyways. Pens will always depreciate. Why? because they are so expensive, limiting the number of people who are willing to buy them. Any fountain pen is expensive when a bic will write just as well. That and there is an even more limited following for a certain pen, so of course it's going to depreciate. There just isn't the demand to cause the appreciation of most pens...*getting off my soap box*

[nicholasyeo]

Not sure why you put Montblanc on a pedestal, why not mention other high end pen makers who have the same problem if not worst.

How much is a Montegrappa Extra worth used ?

Aurora Nobile LE used ?

Delta Israel 60 Special LE ?

Omas Paragon (new style) ?

 

All these pens are loosing MORE then 50% of their value.

I can give you a long list of other good high end pens.

 

Montblanc WE pens usually are loosing less then other pens in their price range and usually you can buy them for roughly the same price bought new and in few occasions they went up in value like

 

1.Hemingway

2.Agatha

3.Wilde

 

My rule of thumb is never buy new MB unless its a LE model.

They are very common pens, easily available and once bought used keep a solid value so I always buy my MB used and advise people to do the same.

I find them to be very reliable (if not the most reliable).

If you choose to buy them new thats your right but you should know they are just like any other pen maker out there in regards to their regular edition models.

 

MM! Good advice. I shall remind this person whom I am helping to do so in future.

In fact, perhaps not just buying limited editions, but second hand ones!

Come to think about it, many LE's are available, just for a little more.

I am sure it will help much more, because of the rarity and value.

Edited April 10, 2010 by nicholasyeo

[jar]

Say,

A Boheme Noir was purchased in 2005 brand new from a MB boutique at 640USD.

In 2010, five years later, DESPITE THE FACT that it was unused, and has a box and manual,

offers come in ONLY near the range of 324USD, a 50% decrease in value.

 

Say,

An ST Dupont Colombus was purchased in 1992 brand new from an ST Dupont Authorized Dealer at 350USD.

In 2010, eighteen years later, DESPITE THE FACT that it used, and I lost the box and manual,

offers come in ONLY near the range of 650USD, a 46% increase in value.

 

Hey, you pays your nickle and takes your chances.

[karmakoda]

When buying from an authorized dealer, a premium price is expected, because there are actual warrenties, guarantees, and service agreements plus the secure knowledge that all is "above board" and genuine. Not to mention the wages and lease payment for the boutique.

When buying from an unauthorized seller, zip for overhead, an expectation of a generous discount, even fify percent is natural. The only way to generate higher sales prices is through creative marketing and presentation.

Marketing is the responsibility of the seller.

eBay is a good example, and a Montblanc #22. This pen usually sells for between $60 and $130, but one is selling now at a current bid of $255 (3 hours to go) and the difference is marketing. The photos are excellent, the description is over the top enthusiastic, and the seller knows what he's talking about. This seller does this time and time again, and he is a genuine and generous person with a 100% feedback score of 1646 transactions.

Depreciation is linked to a sliding scale of expectations.

You can't expect to say, "Hey, this Montblanc pen just fell off a truck, but I can let you have it for the boutique price."

[nicholasyeo]

I think you're being unfair to MB. Hardly any pens hold their value, obviously there are exceptions such as the Hemingway or the Proust which have more than doubled in price.

 

To me it is simple supply and demand.

 

Not many people in the general scheme of things collect pens. Not many pens are truely "limited" in that they are sold in large numbers. This means that you are always able to find someone selling the pen you want, this means that there is competition in price.

 

An object is only worth what someone is willing to pay for it.

 

1 = Does this mean that there is an over-supply?

2 = When the numbers become so limited that the prices jump sky high?

3 = The strange thing is that the actual same thing is still sold today

in the shops, as brand new. We'll never know, but maybe it's not

doing really that well as a product.

 

1 = Surely you can appreciate when an item is mass produced and appreciate what that means? Companies such as MB make enough pens to ensure that when someone wants one they are able to get it without having to wait on an order list for months for an item be become available. These items are not over-supplied as if they were the companies would not make any profit as they would have too much revenue tied up in unsold goods.

 

2 = A number of factors govern price, they are supply and demand. If demand is higher than the supply then the price will increase. Demand can not always be computed, the Hemingway and Proust pens for example are liked by more collectors than some of the other pens in the writers edition range - it doens't manner why this is, it is a fact - as the supply of these pens is equal to the others in the WE range the price is therefore higher. Similarly if MB brought out a stinker of a pen which no one wanted then the price would drop as people would be desperate to offload the unwanted items to anyone who would take them.

 

3 = Not sure what you're getting at here. As others have said, if you can buy the products you are selling in the shops then you will have to sell your product at a significantly lower price. Why? Because people like me would rather buy from an authorised seller as we'd buy with confidence and know that we have a legitimate product, it is not damaged, it comes with all the correct paper work. I only buy from individuals if the price is very low or I have no other option i.e. the product is no longer sold as new.

 

Maybe you should give us some examples of items you're trying to sell. Maybe you are ignorant to the type of prices sane minded people are willing to pay. Maybe you are buying too high and therefore it is impossible for you to make a profit. With specific examples the educated, knowledgable people on this forum might be able to assist you.

 

Remember though this is not MB. This is an economical problem which means you have to source your products at a lower cost than others are willing to buy them from you at. This is where your profit comes from.

 

Well, there are three pens here:

these are the....

 

Boheme Noir Fountain Pen 360USD - 200USD is 70% less than the original price, without counting postage.

 

so even if it was purchased at a 30% discount, 600 usd, 200 usd is very much less. 50% would be 300USD.

 

Boheme Noir Ballpoint 216USD - 125USD

Boheme Noir Pencil 216USD - 125USD

 

The cheaper ones are the price they said reasonable. And it was supposed to include postage.

 

Another two:

Stainless Steel Boheme Ballpoint with Amethyst

Stainless Steel Boheme Rollerball with Amethyst

 

I cannot ascertain the prices here.

 

And no, I am not trying to profit, rather, cover 50% of cost.

Edited April 10, 2010 by nicholasyeo

[mejdrich]

Really? Depreciation?

 

OP, come on.

 

Non-financial assets experience depreciation the minute they leave the lot - the difference of "new" and "used". However, due to unusual circumstances, almost always scarcity, some non-financial assets do appreciate beyond or hold their initial value.

 

Please, do not hold a luxury good to a standard that really doesn't apply...

 

And, I am sorry to get on a soap-box here, but PU-LEASE, let's never, ever, really ever, consider pens as an investment asset... Unless you are actively engaged in the business, either as a broker, manufacturer, retailer, etc. - then it's okay (and, then, it's not a financial asset, but inventory.).

 

Oh, by the way, I must be an investment guru - Bogle watch out - I "astutely" recognized the "value" implicit in the MB Hemingway and purchased one on sale (with a coupon, as well) when it was introduced... (No, really, GENIUS!)

 

Okay, off box, back to normal, curmudgeonly self...

Edited April 10, 2010 by mejdrich

[shadowsforbars]

Perhaps your time scale is too short. Look at the market value of your pen after 50 years rather than 5 and you might get a different result.

[niksch]

Perhaps your time scale is too short. Look at the market value of your pen after 50 years rather than 5 and you might get a different result.

 

 

Right. How about those celluloid 139s and 149s that are selling for $3000 or more???

[hamtaro]

 

You can't expect to say, "Hey, this Montblanc pen just fell off a truck, but I can let you have it for the boutique price."

 

OMG ! Can I get one of those ? :roflmho:

 

Seriously though, a lot of excellent points in this thread. My favourite analogy is luxury cars, it's the drive that counts - not what you paid or what you will sell it for, 10 year down.

[nicholasyeo]

 

You can't expect to say, "Hey, this Montblanc pen just fell off a truck, but I can let you have it for the boutique price."

 

OMG ! Can I get one of those ? :roflmho:

 

Seriously though, a lot of excellent points in this thread. My favourite analogy is luxury cars, it's the drive that counts - not what you paid or what you will sell it for, 10 year down.

 

Most definitely.

I mean, although I am only 16 and haven't had much experience like the rest here,

I have gotten useful insights into the nature of sales, and the proper strategy

if one wants to make the right choices when making a purchase.

Edited April 11, 2010 by nicholasyeo

[jar]

 

Most definitely.

I mean, although I am only 16 and haven't had much experience like the rest here,

I have gotten useful insights into the nature of sales, and the proper strategy

if one wants to make the right choices when making a purchase.

 

You need to remember that reality is almost always more complex that anyone thinks. In luxury cars, Mercedes is often the first marque that springs to mind but in much of the world, Mercedes is the choice for Taxi; a solid, dependable but boring vehicle.

 

In the world of fountain pens, Montblanc is considered one of the current top tier pen manufacturers, right up there with Pelikan, Caran d'Ache, Dunhill, Cartier, Yard-o-Led, ST Dupont, Conway Stewart, Nakaya, Dani-trio and a few others.

 

It is NOT though considered inherently better than any of those other marques. It may be preferred by some, but there will likely be an equal or greater number of folk that show a preference for one of the other marques.

 

Second, consumer goods, even luxury consumer goods, seldom appreciate over the short term. Look at the market today for 'vintage' 1960 clothes.

 

'Splain why a torn pair of used blue jeans that were given to Goodwill about the time Disco appeared should carry a premium price today?

 

Look at used cars. Look at antique cars. When does that 'used car' turn the corner and begin appreciating?

[karmakoda]

 

You can't expect to say, "Hey, this Montblanc pen just fell off a truck, but I can let you have it for the boutique price."

 

OMG ! Can I get one of those ? :roflmho:

 

Seriously though, a lot of excellent points in this thread. My favourite analogy is luxury cars, it's the drive that counts - not what you paid or what you will sell it for, 10 year down.

 

Most definitely.

I mean, although I am only 16 and haven't had much experience like the rest here,

I have gotten useful insights into the nature of sales, and the proper strategy

if one wants to make the right choices when making a purchase.

 

Funny how a little detail changes everything. Sixteen. I have T-shirts older than you.

At sixteen, you're supposed to challenge everything, and a little rant here and there, well, that's just par for the course.

You have conducted yourself well, taken the hits and responded politely, with a maturity that I would not have expected.

If you're selling on eBay, take beautiful photographs of the pens and make your descriptions as accurate and thorough as you can.

Best of Luck with the pen sales. I think you will do just fine.

[stevlight]

A pen is a tool--not an investment.

[View from the Loft]

When does that 'used car' turn the corner and begin appreciating?

 

As it happens, I own and drive such a car. I bought my Land Rover Defender 110 Station Wagon used in 1999. I acknowledge that until now it has "lost" value every year (but only if I were to sell it). However, Defenders sell on condition, not age, once they are over about 10 years old. Mine is in good condition (and as a mechanic in a previous life, I treat it and drive it well), and is now starting to go up in value. I don't expect it to go down in value again. As an aside, we were looking for a small car for a runabout. The look on the salesman's face when he asked me what trade in value I expected for my 15yo Defender was hilarious. It was the first time that he has ever had somebody seriously say £4,750 for a 15yo car (not that I would sell this car) :roflmho:

[goodguy]

A pen is a tool--not an investment.

Respectfully disagree with the first half of your statement.

 

Pen can be used as a tool on top of being a collection piece but they are most defenetly a very bad investment (unless you bought 100 Hemis when they were sold for 400$ a piece ).

[Blade Runner]

When does that 'used car' turn the corner and begin appreciating?

 

As it happens, I own and drive such a car. I bought my Land Rover Defender 110 Station Wagon used in 1999. I acknowledge that until now it has "lost" value every year (but only if I were to sell it). However, Defenders sell on condition, not age, once they are over about 10 years old. Mine is in good condition (and as a mechanic in a previous life, I treat it and drive it well), and is now starting to go up in value. I don't expect it to go down in value again. As an aside, we were looking for a small car for a runabout. The look on the salesman's face when he asked me what trade in value I expected for my 15yo Defender was hilarious. It was the first time that he has ever had somebody seriously say £4,750 for a 15yo car (not that I would sell this car) :roflmho:

Defender's are awesome! I drove around in one in Kenya and was impressed with their off road handling. I wanted one, but they're hard to find in the US.