Much has been written in Soundpost Online about the realities of shopping for fine string instruments. One of the main problems with buying a valuable string instrument is the difficulty one faces in reselling them.
Obviously anyone in possession of a fine string instrument for sale needs to develop a de-acquisition strategy, but would-be buyers of expensive string instruments would also do well to develop an understanding of the realities of reselling what they will buy.
A valuable art object like a violin is a vexing problem for an estate: expensive string instruments are frightfully difficult to sell, and reliable information about string instruments and the market and prices for them is difficult to gather for those outside of the trade. This also should be fully considered by potential purchasers as an offset to the potential benefit of a long-term holding strategy.
Part I: Private Sales
So how does one go about de-acquisitioning a fine violin? In theory, by avoiding a dealer commission, a direct private sale should net a seller the highest price. The realities of private transactions are often at odds with the theory. Before considering the private sale avenue, retail vendors need a realistic view of the problems inherent in marketing string instruments privately:
Authenticity and Consumer Confidence
There are many more string-instrument dealers than universally credible experts in the trade. Expertise is a fluid topic with revelations about instruments and makers sometimes exerting a radical effect on values. Many horror stories circulate about problems of expertise having wiped out perceived equity with various string instruments. Retail consumers hear these stories from colleagues and insiders in the trade or read about them on the Internet, in the course of normal research about the objects. As a result, consumer confidence is often low, and most high-end transactions in the trade fail to close without the support of a respected authority.
Pricing and the Effect of Commissions
Outsiders to the instrument trade often overlook the effect of commissions and can be confused by values assigned in appraisals. Interpretation of appraisal dovetails with the effect of commissions in important ways: A private seller often uses the most recent insurance evaluation as a basis for their perception of what they should receive in a sale of their beloved instrument. But insurance valuations typically indicate replacement price for a comparable instrument from a major dealer, not net proceeds of a sale event, and the difference between those numbers is nearly always at least 20%, and normally much more. A private seller attempting to neutralize the role of dealer in the market usually finds that most buyers who buy privately are looking for a special deal in return for the effort of identifying a private seller and absorbing the risks involved in transaction without retail vendor guarantees, and service.
The string instrument market is extremely narrow and specialized. For a consumer with one or two objects to sell, finding a match with a prospective buyer is something akin to looking for a needle in a haystack. By contrast a dealer has a long-cultivated access to the market through advertising and reputation, and the drawing power of a varied inventory on offer along with the credibility to inspire consumer confidence. Further a dealer will work hard to protect their investment in market access.
Adjustment and Restoration
Antique String instruments are sensitive tools that require periodic, expert restorations, and tonal adjustment to perform well. The effect of adjustment and set-up on a fine instrument can be profound. A poorly maintained or poorly set up instrument may be unusable as a tool. The same instrument may become a glamorous match for a musician once it is put into proper adjustment. The best restorers and adjusters are rare and are usually either in the trade as dealers themselves, or they work for major dealers. As trade insiders, or employees of insiders, fine restorers have a vested interest in using their best effort for inventory that will generate a commission for the firm for whom they work.
Market Saturation and Word of Mouth Communication
A private seller runs certain risks in marketing their instrument without the help of a dealer. If an instrument is marketed with an inadequate set-up it may produce a negative reaction in a potential buyer who will have then dismissed the instrument, and will not reconsider the piece, even if they might have had a totally different reaction, if the instrument had been better set-up in the first place. An instrument marketed privately, that fails to sell, may be difficult for a dealer to successfully offer, if the price must change in the remarketing effort. Finally a private seller may find a sale hard to achieve simply because of the scarcity of potential buyers in the market at any given time.
Summary of Part 1
- Low consumer confidence is a potential obstacle to private sales with fine string instruments.
- The conflict between the price objectives of private sellers and those of private buyers is a potential obstacle to private sales with fine string instruments.
- Market access is difficult to achieve and closely guarded by the dealers.
- Instruments require serious restoration, set-up and adjustment work to function well and restorers under the employ of dealers are not likely to help a retail seller bring an instrument to top playable condition without a consignment arrangement in place.
- Private Marketing of fine string Instruments risks saturating the market and limiting more viable, short-term sales possibilities.
Due to all of these factors, private transactions, while not unheard of, are rare in the string instrument market. If you own an instrument and do want to try access the market directly, one strategy is to contact the best-known teachers and members of a symphony orchestra in your area. Several important marketing tips:
- Legal tangles in the world of fine string instruments are to be avoided. Be certain that you have done the reasonable research in determining that your instrument is authentic in the eyes of the best world experts. Be sure that someone credible can establish for you that your instrument free of critical hidden flaws that could have effect on the value. Failure to accurately represent your instrument in a transaction could leave you legally liable for a claim of negligent misrepresentation, even if you were unaware of the problem yourself.
- It will be necessary to lend your instrument out on trial and you should be sure that you are insured against loss or damage.
- Give a prospective buyer no more than two weeks to decide on your instrument. It normally takes less time than that for a buyer to decide, and a transaction that takes more time than two weeks is likely to fail. Best to move on and show the instrument to the next prospective buyer. Even if you don’t have the next prospective buyer lined up, do not allow the instrument to languish with the potential buyer who will not buy it: nothing good can come of this.
- Do not negotiate on your price until you are being given a bona-fide, firm offer with all terms of payment being specified up front. In a pre-offer negotiation, you achieve no real progress toward your sales and price goal, but instead create a lower market price with a new negotiating ceiling.