Print
E-Mail
tool name
closeA new generation of pawnbrokers
Local pawn shops are working to destigmatize their industry and gain a new kind of customer
By Avani Nadkarni/of The Herald
Pawn X-Change owner Brad Shain fell into the pawnbrokering business quite accidentally.
Shain decided to open up Pawn X-Change, which is now the largest privately-held pawn chain in the country with 40 stores in Washington and Arizona, including one on South Hill, when he was in Texas visiting various companies to sell them microchips.
“I saw pawn shops on every block,” Shain said. “I thought ‘What a great business model. They’ve cleaned it up and treat the customers well. We could do that in Seattle.’”
As large and modern as Shain’s chain is, Ron Goodchild’s independently-owned Sports Etc. and Pawn Shoppe in Sumner is the opposite. Goodchild said after he expanded from a sporting goods store to a pawn shop, he decided to design his business after old-fashioned family-owned pawn shops. Although there is a uniformity to the merchandise, mainly tools, DVDs and musical instruments, much of it is cluttered around and stacked high. “Bullwinkle,” a mounted moose head from the 1950s, hangs above the door.
“(Customers) say they like digging into the shelves,” said Goodchild, who opened up the pawn shop section of the store in the late 1990s. “It’s not like the new glitzy stores. I think people enjoy it.” Still, Goodchild said he is friendly with area pawn brokers. Shain said he’s driven by Goodchild’s store and wants to stop in soon to say hi.
“Most pawn brokers are real good to each other,” Goodchild said. “It’s a business where we want to help each other.”
Perhaps part of the reason for that, they said, is that all pawnbrokers, from mom-and-pop stores to national chains, have to follow strictly regulated rules, much like banks. In Washington, pawnbrokers can only charge about 3 percent interest and must be in constant communication with local police to weed out stolen items. In fact, said Shain, all state pawnbrokers are required to communicate with police at least every 24 hours. They all must keep the items in storage for 90 days before they are able to put them out on the floor for sale.
“If someone comes in with an item of value, we verify it’s real, take the person’s federally issued ID, put it in our computer system and evaluate the item,” he explained. “All that info goes to police within 30 seconds.”
While Shain calls the pawn industry “absolutely recession resistant,” both he and Goodchild said they haven’t seen the sudden spike in either loans or sales that people may expect in economically hard times. Goodchild noted that while people used to come in after about one month to collect the item they loaned the shop, now they often take longer.
Ken Smith, a Sumner resident who works in construction and tiling, said he’s stopped by Goodchild’s shop about three times now, generally looking for tools.
“Lately, it’s a lot better buying your tools from a pawn shop than brand-new,” Smith said.
Sumner resident Logan Fisher said his most recent visit to Goodchild’s shop was for a cat’s paw, a small crowbar-like tool, but that he had purchased a variety of items from the store.
“I’ve gotten a camera here, games,” he said, adding that he’s never pawned anything off, he usually just shops. “I usually have something specific in mind when I come in here. You never know what you’re going to find.”
Customers like Fisher, ones who simply use pawn shops as thrift stores, are new customers than Shain is trying to attract.
“Even if you don’t need a loan, you can shop here,” he said. “People love a value and we provide that.”
South Hill Pawn X-Change employee Larry Scott the hot items at his store stayed pretty constant: Jewelry sales make up about 65 percent of Pawn X-Change’s business. Several years back, he said, Pawn X-Change had someone bring in a 10-carat gold ring, which they got $100,000 loan for. Pawn X-Change’s average loan however is around $100; the Pawn Shoppe’s is around $50.
Another challenge Shain said he faces is beating the entertainment industry’s stigma of pawnbrokers. Shain had just been working on his business for a year when the 1994 crime film “Pulp Fiction” hit theaters. He found himself cringing at a particularly violent scene involving a pawn shop and its owner.
“I just sunk in my seat,” Shain recalled. “What a horrible scene. Hollywood has really stigmatized pawn shops. We’re working on beating the stigma.”
He nixes the idea that pawn shops are dark, seedy hotbeds of unsavory activity.
“For us, one-tenth of one percent of our items are stolen goods,” said Shain, who sits on the National Pawnbrokers Association board and often travels to Washington, D.C. dealing with the politics of the regulated industry. “That’s pretty much the national average.”
“At least two or three times a week, people come in looking for items that were stolen from them,” Goodchild said. “They rarely find it. We rarely get stolen items.”
In addition, all pawnbrokers are required to have either a computer or paper list of all area felons from the past 10 years who won’t receive loans. While Pawn X-Change did sell firearms for the first two years of operation, Shain said as the company grew, the idea “scared the daylights out of me.” Goodchild does have a collection of rifles and handguns, but said he follows all the rules any other gun store would be required to follow.
A complete reversal of the seedy pawnbrokers seen in films, Goodchild, a 40-year Sumner resident, finds joy in giving back to not only his regular customers, but the community in general. He asks the regulars, who make up the majority of his customers, about spouses, children, pets. He constantly gives away pens, frisbees and balls to youngsters that come in with their families. Once, when his son’s Auburn High School band director bought several musical instruments from the Pawn Shoppe, Goodchild donated several more to the school’s band program. Recently, he gave away a musical instrument to the child of a regular customer.
“They couldn’t afford anything like that,” Goodchild said. “I just said ‘Invite me to the concert.’”
It’s the customer service and destigmatization that Shain has tried to carefully cultivate that has made pawn shops popular in East Pierce County. Goodchild said he sees a steady stream of customers throughout the day and Shain reported that the South Hill Pawn X-Change branch is one of the company’s busiest locations.
“You’re dealing with a demographic that fits our model,” Shain said of East Pierce. “They want a value and sometimes they need a loan and maybe can’t get it from the bank. It’s a great place to try something new.”