This is a common mistake made by most golf retailers and pro shops. By selling used golf clubs in your own store or pro shop you are losing money. This is a bold statement. Most of you are thinking, “How can this be true, if I am selling my trade-ins for more than I paid for them, I am making money?” Well, yes you are making some profit for yourself but not as much as you should be. By just having used clubs for sale in your store, you are losing out on a good amount of profit generated from new golf club sales. Let us elaborate on this point. The used golf club market is becoming larger and more structured by the day. Golfers can now use the Internet to not only look up how much their used clubs are worth, but what their resale value is as well. This resale value is currently set about 20-30% above the trade-in value. You can no longer take in used golf clubs on trade and resell them for 50-60% profit. The market just doesn't allow for it anymore. So why would you want to sell used golf clubs that only carry a 20 to 30 point profit margin when the rest of your new golf clubs carry a 40 to 60 point margin. When you give your customers a choice between buying new and used, most of them will buy used. Selling used clubs will dramatically decrease your new golf club sales and your overall profit margin.
Let me show you an example of what happens to stores who sell used clubs in house. Most customers shopping for a driver want to leave your store with a driver. They want you to sell them a driver. So if this customer wants a driver for $150 and is deciding between a brand new Nicklaus driver for $149.99 and a used Callaway driver for $119.99 which one do you think they will buy? Of course you all answered this question correct, the Callaway driver will win 99% of the time. So how did you lose money on this deal? Well think about it, you paid $85 for the used Callaway driver because that's what its trade-in value is currently set at. You only paid $75 for the new Nicklaus driver because they sell to you at a good profit margin. So you lost out on 75 dollars profit and settled for 35 dollars instead. You lost an extra 40 dollars profit and you also put 30 less dollars in your cash register's drawer. This is only one example, but 90% of all customers think this way and will always buy used brand name clubs first. Even if you put a new Callaway driver in the mix, the customer still chooses the used driver.
Now you may think, we will just sell the used Callaway driver at $170 instead so we can still work on a 50% profit margin. So by doing this you set your price at $50 higher than the market price and the driver sits in your store for 3 months. By this time the market price for the used Callaway driver has fell to $100 and now you are forced to lower it to $100 just to get rid of it. You just put yourself in the same position as you were before but now you will only make $15 instead of $35.
This is why we are here for you. We provide you with a means to turn your used golf clubs into cash without hurting your new golf club sales. If you currently sell your trade-ins in house just think about how many more new golf clubs you would sell if you didn't give your customers the choice to buy used. These ideas did not come out of thin air. They have been proven in many golf stores already. By joining our program you will make more money.