The News from ElephantToenails.com

While probably hundreds of older toenails change hands every month, we do our best to watch for sale prices for us here at ET.com.

We know eBay has them going on weekly, though not all are antique toes, so when we learn of other auctions, we want to know the results. We also do our best to track private sales of toenails as we can learn about them and do promise to keep the seller and buyer’s identities private, if requested.

You may have noticed Bruce Voyles had Auction #39 a little over 30 days ago. A few older toenails were included and I wanted to bring these results to you.

(more…)

In the recent series of What determines Price in Part II we looked at how the price paid for a particular knife doesn’t always reflect the market value of that knife due to either an over-motivated buyer or seller.

Now in this final installment I want to examine these sales approaches (alternatives) from a price perspective. I know there are other factors and we examined those in What is the best approach to sale for you individually based on your personal criteria. Then in Part two- Sales Alternatives we looked at the pros and cons of the different sales approaches.

The question before us now is- “Are there times the method used actually affects the price (the outcome)?” I’m talking something like a glitch or problem with the system itself that would affect the results.

(more…)

When it is time to sell your knives, what is the best approach? Should we take the knives to the next area show, put them on eBay, sell them to a dealer all at one time, or should we hire a traditional auctioneer to sell them for us?

You may be thinking, “Whoa, Scott, where the heck is this coming from? We are having fun collecting toenails here….we talk about buying, so why are you talking about selling?”

Guys one day we will sell. Heck, you never know, you might decide to start collecting butterflies or election buttons (just kidding) or simply want to reallocate your assets, if you will, or could be faced with a forced sale, or worse, an estate sale, you get my point- bottom-line, we need a plan, OK? I think about this frequently as it relates to my collection, my family and their livelihood, and what if something should happen to me. This article is not about a forced or estate sale, so cheer up, but not to think about it at all would be some form of denial, wouldn’t it?

Frequently I am asked about my auction experience and how the prices realized at auction compare to those obtained through the more traditional one-on-one approach, and more recently, how the online auctions compare, from a seller’s perspective. (more…)

Part Two: Price vs. Value

In Part One of “What is Price,” we were reminded that WE are the demand. It is the buyers who determine value and buy at our price (most of the time). I realize in the real world it is more balanced and takes a willing seller in order for our “price” to be acceptable. I am not talking about going around slinging low-ball offers just because we determine what a toenail is really worth, but it is not the opposite either- a seller demanding his price just because he has a rare toenail “for sale.”

In Part Two I want us to examine how price and value compare, if they do. So, let’s start with What is Value, What is Price and aren’t they the same thing?

In layman’s terms, Value is what something is worth as supported by “the market.” Price, on the other-hand, is what is expected, required or given. It may be more or less than its value. Furthermore, price often follows value, not the other way around.

Say, you NEED a Case Brothers stag (5250) to complete your Case Brother toenail collection. You locate one from a dealer who 1) Recognizes you NEED it, or 2) isn’t motivated to sell it below a number at which he is willing to keep it. You are a highly motivated buyer and he isn’t. So provided you can come to terms is the price you paid representative of the value of a Case Brothers Stag? Probably not. Its value put you in the ballpark, but it is likely this seller is wanting a premium and you are willing to pay it. In a more typical situation, the buyer wouldn’t be willing to pay the sellers above market value, thus the sale wouldn’t have been consummated.

More-often than not, what we run up against is a seller (usually a dealer, but not always) who wants to command a premium price and this often results in the knife staying for sale for a while. In fact it will either stay for sale until one of two things occur- the seller eventually gets right or a buyer finally gives in and pays the price. Sometimes enough time has transpired for the value to have caught up with the price. I saw this in real estate many times prior to 2006.

I personally know of a seller who had some fine toenails for sale. He admittedly didn’t care if they sold or not (which strikes me odd). His prices we above market value resulting in him carrying the toenails around from show to show for a least a couple of years. Finally the values came up close enough to his price that he started selling them. So, was his price the real value? Obviously not, otherwise, they would have been snatched up the first time they were displayed.

Fellow collectors, don’t fall victim to the notion that “there are so few collectors that it takes months or years for a rare toenail to sell.” That is wrong. We are lead to believe this oftentimes by dealers who attempt to justify their price. Take for example, Jumbo Swellcenters, one of the more expensive toenails among collectors, I know of at least 4 sales just this past month. So the one that remains for sale for a long time, either doesn’t have strong demand because of something about the knife, or is overpriced. It is not that there aren’t many collectors who can afford them. Joe Seale told me years ago, he typically doesn’t keep a Jumbo for more than 30 days.

There is no doubt toenails are not a life staple. We don’t live or die as a result of not getting a particular toenail. But because of this, defining our “need” for toenails is much more difficult and can lead us to paying a price that isn’t supported by the market (and many times this is OK with us).

Price is more subjective, whereas value is more objective. Price, at the end of the day, is the amount an individual collector, or dealer, is willing to pay or sell for. Value is much more broad and is a price that is supported by the market.

Collecting is emotional- not rational and can cause collectors to pay a price that is a perceived value, but may not be market value.

This concludes the two-part series on “What is Price?” I recognize no earth shattering revelations were announced, but it is important to understand the difference between price and value, how price is determined and whether or not that price represents the market as we continue on our toenail quest. Reminding myself of these truths helps me to calibrate when I lose focus and perspective, which happens almost every time I run across a new toenail to buy.

Part One: WE are the Demand!

I wrote this article several months ago, however, haven’t felt it was “time” to run it- Well now I do. My prompting was a email I received yesterday from a collector asking me about a toenail he was being priced to buy. This collector indicated he was offered this toenail and thought the price was too high and wanted to know my 2 cents. Well, it fired me up!

This collector was being offered a jumbo for about 25- 30% more than any toenail of that style has sold for (and we track them closely) and this equates to a bunch of money considering what really good Jumbos are selling for. I told my fellow collector in no uncertain terms- “No, the knife wasn’t worth that price if you want to use recent sales as the basis.” I know there are times we use other factors to help us individually determine the worth of a knife, however, if you just look at “comps” then we have a very good indicator as to what other collectors recently paid. Then there is the “What is it worth to me right now?” question.

We know the number of Toenail collectors is continuing to grow each year. Toenails enjoy a very high degree collectibility and popularity. From all indications I can see (from visits to my website, conversations with dealers and collectors, bidders on online auctions, etc) it will continue in popularity.

One of the benefits resulting from this popularity is a large enough group make up toenail collectors that enable us to make some things happen. It wasn’t too long ago, a dealer might have for sale a “once in a lifetime” offering of a Jumbo Swellcenter (or any other toenail, for that matter) and would stick a really big price on it. Then the collector (buyer) not knowing how long it would be, if ever, he would find another one like that bought it. The price was typically secondary in the decision and was pretty much dictated by the dealer.

You are familiar with the old economic principle of Supply and Demand. Well, WE are the demand.

I am convinced the supply is there and now we have the opportunity to drive our own market, instead of being a victim to the prices/values of the dealers and price guides. In the past we were told what values were, what brands have the highest value and which ones are the least popular, etc. In the past we have been told… “well this toenail is priced at X because of Y,” which may not reflect what we as collectors judge is important.

In the end it is the Buyers who determine value and the factors that are important in knives that are purchased…not sellers (I confront this issue of how value is determined almost every day in my “real job” of meeting with real estate owners who think just because they spent X on their “premier property” then it should be worth that, well…the harsh reality is if no one buys the property (after a reasonable period of time) the conclusion is it simply isn’t worth X. Period end of story).

My goal is not to start a rebellion, but here is a real fact: In most cases toenail prices are being set by “Price Guides (mine notwithstanding),” instead of the price buyers are actually paying for these knives. It is not uncommon for the writer to take a few sales to help them in their assessment of what has happened to values, but just due to the sheer number of patterns produced it is impossible to make it much of a science.

Moreover, many insiders attempt to “drive the market.” Just because 88’s (what ever the heck that is) went up X% doesn’t mean toenails experienced the same value change (it could have been more or less). I am well aware of “record prices” periodically paid for toenails and I do my best to keep my ear to the ground in an attempt to see where values are going and what is happening as it relates to toenails. Yes, I know of a few record sales for extremely rare toenails , but those sales are also the exceptions rather than the rule, and furthermore, don’t necessarily “set” the price for the rest of the approx. 100 other brands or 300 different variations of older toenails that are out there.

Bottomline: WE are the demand and we decide what a particular toenail is worth.

Part Two in this series on “What determines Price?” will be posted this week entitled “Is there a difference between Price and Value?”

Rethinking the Knife Industry’s Standard of “Collectible Condition” for Vintage Knives

What should be the basis of value for old knives?

Let me begin by asking you- When was the last time you saw a Near Mint or Mint Case Brothers toenail in stag or pearl, or who about a Near Mint or Mint W R Case & Sons Jumbo Swellcenter, or maybe a Near Mint or Mints Platts Brothers Andover, NY toenail, etc. The list could go on and on.

The question wasn’t if you had seen any of these toenails, instead the question was about the condition of these knives- Near Mint or Mint.

I have come to the realization that affects all collectors. The knife collecting establishment has created and embraced a standard that is flawed as it relates to vintage knives.

While the old school says “Condition is the basis of value,” however, when considering vintage knives, one must be a bit more practical. I contend- Brand is the basis of value. Brand is the Who, What, When, Where and Why of a knife or pattern. The history behind and the identity of the company that made or sold the knife is a more significant factor relating to value, not whether or not the tang stamp is super crisp or if the blade snaps like a new knife.

Hear me out on this- My interest is not in lowering the standard, instead it is more to approach building a collection of vintage knives from a practical perspective.

I am sure this problem is not just limited to toenails. This dilemma faces all vintage knives, particularly a pattern that was made for a specific use, or has been discontinued, or was produced by a knife company no longer in operation. Moreover, we know the toenail was produced to be a hardcore work knife, aside from the fact it became obsolete in the mid- 1900’s with the advancement in hand tools and machinery.

We frown on restored, reworked or cleaned knives, yet the establishment continues its mantra “Collect only Near Mint to Mint knives.” We had all seen first-hand here at ET.com the byproduct of this emphasis on condition. It is cleaning, buffing, and in some cases reworking old knives- all done for the sole purpose of producing knives in so called “collectible condition.”

Should not the standard of collectible condition for a newer knife be different than an old knife?

Don’t get me wrong, as a collector I want the best condition knife I can find, however, I believe from the most practical viewpoint that the brand should be the basis of value, not condition, as it related to vintage knives.