Tony Wise, the owner of Granter Jewelry and Loan Company in El Cerrito, considers the pawn industry the economy’s divining rod.
“You’re at the pulse right here,” Wise said. “ It’s really interesting because I can tell what’s going on in the street by what is happening here.”
From his vantage point, the recession hit the middle to upper class first, while the less affluent were accustomed to dealing with less.
“We saw people who didn’t recognize that things were slowing down and were buying really well, but they also came in for loans,” Wise said.
Like any other business during a recession, the pawnshop industry has seen better days, but East Bay shops like Wise’s strike a curious balance between loaning money to those who need it to survive and selling their inventory to those who want a bargain.
“You can tell when the checks are late, either Social Security or SSI,” Wise said. Clients come in and sell items, and they’re not giving up the basics. “They’re giving up luxury items, so that they can get the necessities.”
Granters sits on San Pablo Avenue in the midst of a middle class El Cerrito. The shop is well lit and is just doors away from its new home, which is being reconstructed. Cameras, jewelry, coins and musical instruments all beckon the patron. On a recent Tuesday, a ringing phone competes with the door bell customers press to enter.
A young woman comes in and asks Tony’s father, Ralph, how much she can get for a piece of jewelry.
He silently examines the gold chain. “How much are you looking to borrow?” he counters. She said she was not looking for a loan, but wanted to sell. “I could give you $65 for it,” Ralph said. The young woman gasped.
“I went to the [pawnshop] in Richmond and guess how much he said he’d give me for it?” she asked.
“I have no idea,” Ralph said, seemingly used to hearing comparison of shopping results.
“He said he’d give me $15,” she said.
Ralph shook his head and continued filling out her paperwork.
Once someone decides to sell an item, they have to sign a statement that they are indeed the owner of the item, show picture ID and give a thumbprint, which is then forwarded daily to the police department. If they are selling it outright, that finishes the deal. If they are only pawning the merchandise, interest of 1 to 2.5 percent a month kicks in.
If the customer fails to repay the loan during the agreed on time period, the item is forfeited. It can then be sold by the broker, but not before a reminder notice is sent. Some 90 percent of the loans, brokers said, are repaid on time. An equal percentage of clients, they added, return for a new loan.
Bob Robinson of United Jewelry Mart of Oakland said the recession means his clients sell more at once. “We see people bringing in five to seven pieces, whereas in the past they brought in one at a time.” The store sat quiet during the interview, only the sound of traffic going by.
Barbara Cogar, manager of the California Loan and Jewelers on Telegraph Avenue in Oakland said she has seen the same. “We get people all the time, bailing folks out of jail, paying bills,” Cogar said. “They come in for short-term loans for things like tuition.”
Cogar said that most of her store’s clients are repeat customers. In her 35 years at the store, she has seen and heard it all.
“One man came in, and when I asked him what he was going to do with the money, he said ‘I’m going to buy drugs.’ Then he changed his mind and asked for his [property] back.” She chuckled, “That’s the worst thing I’ve heard.”
Cogar also said, last year a young man purchased a diamond ring and proposed to his fiancée in the store. “That was a first,” she said.
The stereotype of the dim snake pits is one that is changing according to Tim Cassidy of Stockton. Cassidy spent 18 years as a board member of the National Pawnbrokers Association, a professional organization for pawnbrokers that has the mission to enhance images and perceptions of the industry. Cassidy said he thinks there is one way to change the public’s perception of a pawnshop.
“One of the best things people in our industry have done, not just here in California but also nationally, is to clean up the shops,” he said.