Originally Posted by GordonJ
The STORED VALUE concept has been one of my mainstay, foundational thoughts even before SowPub.
It caused a rift between my brother and I when we were flipping cars. He just couldn't wrap his head around it, and I think, M0ST people can't.
The reason MOST can't think this way is: they FEEL somehow cheated, or simply don't see the truth behind the idea:
Circulation BEATS Storage, 364 days a year, yea, MAYBE, one day a year it doesn't.
Here is the example that created our family rift: we bought a car at auction, it had a scrape along its side, deep "keying" like scrape, only wider. It was a beautiful, one year old Hyundai but that big two inch DEEP scratch made it very unappealing to dealers, so got it for a song.
I think about 1200. BLUE BOOK was around 7500. My brother being a body man and mechanic, had the dent out and painted within a week, for about 200 in paint, so we had 1200 plus his time and paint, so about 2500 into it.
I wanted to FLIP it, for 4k. NO, he wanted 7k, under blue book...but he advertised it for 7700, thinking he could drop the price. No matter how much I argued with him, he was FIRM. And I let it go, we had other deals to worry about.
His wife started driving and really liked it. She talked him into keeping it for a few months, through the winter. Long story short, after her driving it for over a year, and being full of McDonald's wrappers, he bought me out and kept the car...never getting any offer in his mind worth it.
See, he knew cars. He KNEW that car was worth 7k and no way in the world he would have taken less than 6 for it, which would have been a nice 3k profit for us...and he thought I was NUTS for wanting to send it down the road for 4 to 4.5K
And this is where everyone goes afoul. I see it everyday on eBay and I follow a lot of people, they want to get the MOST out of their stuff.
I, on the other hand, want to FLIP it quickly.
Because I knew/know, that the quick two thousand we could have made in a week, could have been kept in circulation, bought the next car from the profits, and that one would be 100% profit.
I know people with basements, attics, garages, sheds full of stuff, and then they go get a storage facility for more stuff, and these things have high occupancy rates, I used to manage one.
And many of these people need money, want to sell it...but by God almighty, they aren't going to give it away at some ridiculous low price BECAUSE it is worth more than that.
I, say get the cash today, put it to work, Fast turnover profits and build it up the ladder, the whole idea of the Grow as You Go Plan in the Chattel Report was based on that...THE SPRINT TO FREEDOM is circulation...
And likewise it is as I have been harping here for the last 22 years, the same with INTELLECTUAL PROPERTY...it is only good in the marketplace IF...if
IF..IT IS IN THE MARKETPLACE. I think it may be a big reason I have some people who won't talk to me, and did at one time, because they know I will ask them if they
Sold off the baseball cards? The marketing library? The tools they never use? All stuff in storage, which can be quickly converted to working capital, if they didn't share my brother's mindset, that they will hold it forever rather than sell for less than its worth.
And true DAT for IP too. Anyone want some quick cash, some capital to work with? Share what you know, can do, your experience, knowledge and expertise to the marketplace and get and keep it into circulation so it works for you.
Any comments or questions?