“You Want How Much???!!!…”. Establishing Value 101

Here’s a nitty gritty topic for a proprietor of an on-line guitar store (like me) – ESTABLISHING VALUE! Since this is a Blog, I’ll just ramble a bit with the few thoughts that are rattling around in my brain, rather than trying to write a scientific paper on guitar value-ology! But I won’t lie to you, I have 20 odd years of establishing value in another business – so I have some background here. Let me say that the principles are the same whether you’re valuing a boat, a car, a house, or in our case, a guitar. For example, although “asking” prices have some small relevance in the equation, it’s really the price that something sells for that establishes value of a similar item, for the most part. That’s where the “Vintage Guitar Price Guide” gets its numbers. Then there’s Ebay “completed items” – quite useful and quite current. Plus there are lots of other less visible sources that one learns about over time for checking out “what’s sold for how much”. So we also ask: how long ago did that similar guitar sell? Was it in the current market? Was the guitar that sold identical to the one we are trying to appraise – or do we need to make value adjustments for different condition, features, or mods? Obviously, a guitar that is almost the same as the one we are trying to evaluate but sold 2 years ago may need a value adjustment for a different market. Hey, my pal Jeff P. offered me either a 1961 Strat or a 1958 Tele for $600 – “take your pick”, he said… but that was 1979… so we must adjust value for the time. By the way, I took the Tele! And no, I don’t still have it!  Also, some sales are made under duress, so we typically take a few comparable sales and knock out the highest and lowest… we’re looking for a cluster of prices for similar instruments. Sometimes, especially with modded or unique guitars, it’s really hard to find close comparable instruments that have sold. So there is some voodoo involved – it’s not all science! You kind of have to get a feel for what might affect value and by how many $$$ in the real world.

OK … find one like this! A Strat with 3 Firebird pickups.

Of course, it’s natural for us to feel that what WE have is worth a whole lot of cabbage… but what we want to buy… well, not worth so much. In my little on-line business I tend to just roll with people’s opinions of the respective values, or at least I hear them out, and sometimes I even just do trades for the fun of it – or because I want to change my inventory around (you know, keep the website fresh) – knowing full well that my customer’s opinion of the value of his/her stuff is inflated! That’s the price I pay ’cause I am a geetar junkie! Of course, sometimes reason prevails and I just don’t do the deal… or I only do it if we can get to realistic values – ones where I can make some money – so that someday I can call this a “business” rather than a “hobby”. My problem isn’t figuring out the values… it’s letting my compulsive, guitar-addicted self rule my business self!!! THAT is my problem! Sometimes I really go off the rails e.g. my recent purchase of what I call my “double cut nightmare” – an acquisition (ostensibly for the store) based on impulse and passion that is sure to ultimately end up in the red, that is, once it’s been marketed and moved along!!! But don’t get any ideas! 🙂 , I’m working on getting tough as nails!!! I practice in the mirror, you know! 🙂 To be fitting, I think it appropriate that I post some “guitar porn” pics of a few odd-ball guitars that are tough to pin a value on… Hey, Bo Diddley… we’ll start there.

A bass made by Tom Holmes for Bo Diddley in the 70s and sold after Bo’s passing – I owned this for a while.

Here’s the case that Bo cleverly customized with his own artwork… THE MAN! You betcha!

A 1961 Gibson ES-335 Dot Neck that’s been re-necked using the old fingerboard, truss rod, and binding.

Howard Leese’ (of Heart & Bad Company) ’96 rare Gold Sparkle CU22 – featured on Bad Company Live at Wembley – and soon to be for sale at Blue Hugh Music