Main Image: Jeff Wilhelm, Director of Store Operations for National Pawn and Jewelry
Ask any seasoned pawnbroker about their secrets to success, and you’ll hear about ways that they have shifted their strategy over time. Whether precipitated by market conditions, technology, legislation, or other factors, it’s abundantly clear—pivoting is essential for success in the pawnshop.
“You have to plan for success in the world that you find yourself in each day,” says Jeff Wilhelm. Jeff has spent his 32-year career in various leadership and training roles in the industry that have taken him all over the world. He currently serves as the Director of Store Operations for National Pawn and Jewelry in North Carolina.
A Certified Trainer in Covey’s 7 Habits of Highly Effective People, Wilhelm stresses the importance of having a proactive mindset that assumes responsibility rather than just reacting to external events and circumstances. “There’s a lot of talk about future changes to revenue collected from interest and Pawn Service Charges (PSCs). That just means that we’re going to have to do some things differently and adjust the way that we do business and work to find ways to close the gap.”
“We must be continuously learning and evolving because nothing stays the same. If you are comfortable doing the same thing year in and year out, your organization will become stagnated,” he adds.
A straightforward example of how pawnbrokers can become complacent has become evident in the past few years during tax season. “A lot of pawnshops have never accepted cards for interest payments in years past. Now, customers are coming in with their tax refunds loaded onto them. Instead of just looking at the 3-4% processing charge as a cost of doing business, some pawnbrokers simply won’t make that pivot because it’s not how they’ve done things in the past.”
Wilhelm focuses on teaching others to seek out the opportunities in front of them, which encourages bottom-up innovation. “We teach according to our organizational standards, which we challenge all the time,” he adds.
Challenging the standard is an approach that’s worked well for Michael Mack. Owner of Max Pawn, in Las Vegas, Nevada, Mack is known for being an early adopter of new trends, including as an industry leader in authentic luxury goods.
“You have to be open-minded as to the type of products that you sell. I love traveling the world and seeing fads, fashions, and trends.”
Mack is also a recognized leader in charitable partnerships and community relations, not only connecting with his local community but also shining a positive light on the pawnbroking industry. Behind the high profile, though, his focus remains on customer service “At the end of the day, we really do work hard to deliver the best customer service in the world.”
Customer service is also the driving force behind one of the largest independently-owned pawnbroking operations in North Texas. Dan and Kim Foster have owned and operated Uncle Dan’s Pawn Shops since 1987, now with eight stores and a retail outlet in the Dallas area.
For the past few years, they’ve had a dedicated customer service representative whose job it is to call their 500+ new customers every single week personally. “We thank them for their business, make sure everything went well, and help the customer understand all of the ways that we can help them,” Foster explains.
“Our operation is cutting edge simply because we are always looking for a better way.” A key to this, according to Kim, is in being actively engaged in a network of strong pawnbroking peers. “We invest in ourselves, in our team, and in our business. Whenever there’s an opportunity to learn something new, we are there.”
PLAN, PREPARE, AND EXPECT
Here are three ways that pawnbrokers can pivot their approach to business
1. Continuously make your pawnshop a better version of itself, taking your company to new levels of performance. Instead of seeking change for change’s sake, seek out things that are really going to make your business more agile and competitive.
2. Beyond potential changes in legislation, your business must pivot to meet changing market needs. Next year, millennials will comprise over 55% of your customer base. If you don’t meet their needs, they are savvy enough to find alternatives that will.
3. Solve problems upstream. When you feel as though you spend too much time putting out fires daily, it’s time to pivot and find ways that seek to solve predictable problems before they occur.
4. Your business is either growing or it is dying. Growth indicates that what you’re doing is working. The moment your business stops growing, however, your business must pivot. Monitor and respond to Key Performance Indicators or KPIs so that you’re aware of the health of your business at all times.
5. Beware of churn. Create a culture that takes care of your employees so that they take care of the customers. When your employee turnover and customer churn are high, it’s time to pivot.