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Discussion Starter · #1 ·
I don't understand how people arrive at their trade value.
Let's say I have a Glock 26 that I paid $425 new a year ago. You have a S&W 442 that you paid $400 for a year ago. You have it for sale for $375 cash and a $400 trade value. If we are working on a deal wouldn't mine be worth yours and $25?????????? I'm pulling these figures out of the air so to speak, but can you see the point I'm trying to make? Is the trade value worth more than the cash value. Is your trade value worth more than my cash value? Is the trade value the Obama value? There's something I'm missing here.
Bud
 

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I think trade value is usually set higher because it's not always the "perfect" departure point for the gun. In other words, if you get cash, you can buy whatever you want with the cash; but if you get a trade, then you have to accept whatever the trade is, or whatever the trade is worth (plus or minus some money based on value). What I just wrote seems convoluted.

My bad.

:-B
 

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Les Deplorables
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^^^ What PaleRider said. Bud, using your example, let's say the guy sets $400 value, both cash and trade.

Scenario A: He sells it for $400 cash.
Scenario B: He trades it for Gun X.

In Scenario A, he can take the cash and buy Gun X, which would give him an equivalent outcome to Scenario B. But Gun X may not be his ideal trade for his S&W. so if he sells for cash, he could opt to do other things with that money. So Scenario A gives him options. Options are worth something - that value is what drives the difference between trade and cash sale values.

Or expressed another way, what the seller is implicitly saying is "I want to sell for cash, but if you want to trade, I need some amount more in trade to compensate me for the inherent lack of optionality in my accepting something other than cash." Of course, the closer the trade object being offered is to what the seller's optimal use of the value he receives for his sale item, the smaller the difference between his cash and trade values. For example, if I'm selling Item Y, and I really like 9mm Glocks, I may accept a 9mm Glock in a trade, whereas somebody offering an equivalent .40 Glock may have to add $50 cash to induce me to make that trade.
 

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^^^ What PaleRider said. Bud, using your example, let's say the guy sets $400 value, both cash and trade.

Scenario A: He sells it for $400 cash.
Scenario B: He trades it for Gun X.

In Scenario A, he can take the cash and buy Gun X, which would give him an equivalent outcome to Scenario B. But Gun X may not be his ideal trade for his S&W. so if he sells for cash, he could opt to do other things with that money. So Scenario A gives him options. Options are worth something - that value is what drives the difference between trade and cash sale values.
I agree with this as well.

I'm SlayerNut and I approve this message.
 

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^^^ What PaleRider said. Bud, using your example, let's say the guy sets $400 value, both cash and trade.

Scenario A: He sells it for $400 cash.
Scenario B: He trades it for Gun X.

In Scenario A, he can take the cash and buy Gun X, which would give him an equivalent outcome to Scenario B. But Gun X may not be his ideal trade for his S&W. so if he sells for cash, he could opt to do other things with that money. So Scenario A gives him options. Options are worth something - that value is what drives the difference between trade and cash sale values.

Or expressed another way, what the seller is implicitly saying is "I want to sell for cash, but if you want to trade, I need some amount more in trade to compensate me for the inherent lack of optionality in my accepting something other than cash." Of course, the closer the trade object being offered is to what the seller's optimal use of the value he receives for his sale item, the smaller the difference between his cash and trade values. For example, if I'm selling Item Y, and I really like 9mm Glocks, I may accept a 9mm Glock in a trade, whereas somebody offering an equivalent .40 Glock may have to add $50 cash to induce me to make that trade.
Still makes no sense because you don't know what the other person is going to offer in trade. Put simply, just because you put a higher value on your trade, as opposed to a cash sale, doesn't make it worth more to me.

I have never looked at a listed trade value and said, ooh, let me jump on that. The cash price tells all I need to know. By following what you stated, we could both have a gun that is worth $400, but if I wanted to do a straight trade, I would owe you $50 because your trade value is $450. Why the hell would I want to do that? Or the other way around, why would you want to owe me $50 if you have a $350 trade value on a $400 cash gun?
 

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Still makes no sense because you don't know what the other person is going to offer in trade. Put simply, just because you put a higher value on your trade, as opposed to a cash sale, doesn't make it worth more to me.

I have never looked at a listed trade value and said, ooh, let me jump on that. The cash price tells all I need to know. By following what you stated, we could both have a gun that is worth $400, but if I wanted to do a straight trade, I would owe you $50 because your trade value is $450. Why the hell would I want to do that? Or the other way around, why would you want to owe me $50 if you have a $350 trade value on a $400 cash gun?
It simply benefits the seller. That's all.
 

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Les Deplorables
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Still makes no sense because you don't know what the other person is going to offer in trade. Put simply, just because you put a higher value on your trade, as opposed to a cash sale, doesn't make it worth more to me.

I have never looked at a listed trade value and said, ooh, let me jump on that. The cash price tells all I need to know. By following what you stated, we could both have a gun that is worth $400, but if I wanted to do a straight trade, I would owe you $50 because your trade value is $450. Why the hell would I want to do that? Or the other way around, why would you want to owe me $50 if you have a $350 trade value on a $400 cash gun?
In your example, no trade would take place. Trade values are subjective because everyone will have different levels of demand for any particular item. So using my example, I am more likely to enter a trade for a 9mm Glock than a 40 Glock because (1) I place a higher value on the former (even though the manufacturer does not). And (2) since a 9mm Glock owner will feel like he is getting less of a haircut on his trade item than a 40 Glock owner, the former is more likely to enter into a trade with me.
 

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But if he leaves Chicago at the same time I leave Atlanta...

Anyway, I personally don't see much value in setting a separate trade price, excuse the pun. A trade isn't cast in stone like a fixed cash price. For that matter I don't see a cash price as necessarily fixed either. You're not a retail store with a fixed mark up. Everything is negotiable between individuals. It's all about your perceived values at the time.

Just my .02
 

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Les Deplorables
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Anyway, I personally don't see much value in setting a separate trade price, excuse the pun. A trade isn't cast in stone like a fixed cash price. For that matter I don't see a cash price as necessarily fixed either. You're not a retail store with a fixed mark up. Everything is negotiable between individuals. It's all about your perceived values at the time.
I agree, and I don't set a separate trade value, partly because of 613's point that you don't know what you are going to be offered in trade, so it creates unnecessary confusion. I think if someone is willing to accept a trade, the best route is to set a cash sale price and list what they would consider trades for and just negotiate from there.
 

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The concept of "value" is that of an emotional/subjective attachment. Unless I am selling a gun for $X, if I offer a trade value, my trade values imply a willingness to negotiate. Hell, I will even barter goods and services to "make up the difference." There is no economic forumal to set a "real" price in the difference of a trade or on the price of a used gun.
 

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It's the old "confuse them with numbers" game, nothing more, nothing less. Six of one and a half a dozen of another, is anybody willing to trade for a dozen?
 

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Cash is king. With a trade, there might be an attempt to resell the item. That means time and effort reselling(time is money). You got cash, you got nice little neat transaction. Trade value is kinda like the Romney tax plan(not set in stone and really anyones guess what the hell it is).
 
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