Let's talk about resale value

Tama CW

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When I hear discussions about the “resale value” of various drums, I believe that it’s basically about supply and demand – by category, not so much by brand or model. Used drums of a given quality level and condition tend to fall within a reasonable ratio of pricing to their original costs. So the “resale value” is not so much about the individual drum as it is about the timing of the market and the supply relative to the size of the market.

If that were true a 60's Slingerland 12,14,18 kit would be priced like a Gretsch or Rogers.....and we know that's not the case at all. Brand and Model make a huge difference. It's not just about the sound.....but about the scarcity and perceived collectibility.
There's a very significant portion of the overall demand coming from those with more a collector's view than just the drummer's utilitarian view. Any kit I have bought above and beyond my very first kit.....I factored in the resale value. For those with just one
or two kits in their possession (used only for gigging or practice), I can see the "utility" only view.
 

jeffh

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When I hear discussions about the “resale value” of various drums, I believe that it’s basically about supply and demand – by category, not so much by brand or model. Used drums of a given quality level and condition tend to fall within a reasonable ratio of pricing to their original costs. So the “resale value” is not so much about the individual drum as it is about the timing of the market and the supply relative to the size of the market.

If that were true a 60's Slingerland 12,14,18 kit would be priced like a Gretsch or Rogers.....and we know that's not the case at all. Brand and Model make a huge difference. It's not just about the sound.....but about the scarcity and perceived collectibility.
There's a very significant portion of the overall demand coming from those with more a collector's view than just the drummer's utilitarian view. Any kit I have bought above and beyond my very first kit.....I factored in the resale value. For those with just one
or two kits in their possession (used only for gigging or practice), I can see the "utility" only view.
We're both talking about supply and demand, but I'm also saying that timing of the sale is a factor. I actually bought a brand new Slingerland 12, 14, 20 kit in 1963 -- my first serious drum set -- and it sold for $440 (per 1963 catalog). The Gretsch equivalent sold for $474 (per 1963 catalog. The equivalent Rogers kit sold for $527, possibly a few dollars more (per 1962 catalog). Note that these are all the "special prices" for the kits, not the "regular" prices. So they were not the same price to start with.

Meanwhile, cumulative inflation 1961-2021 was 798%, so translate these prices to today and they would be $3,511 for Slingerland, $3,783 for Gretsch, and $4,205 for the Rogers.

So three points:

First, none of these have kept up with inflation; in fact, a look at the "sold" prices on Ebay tells me they sell these days for very roughly half of what that would be. So buying a kit and holding it until it becomes rare doesn't seem to change the used-vs-new ballpark price ratio when you factor in inflation.

Second, in the time that inflation has increased 798%, the Dow has increased 4,633%. If you accept that these drums sell now for about half of the inflation value, that means that buying the Dow Index instead of drums would have produced more than 116 times the return. So as an investment, drums might not be the best choice.

Third, you're right that the collector's market is a slightly different animal because it's about people buying primarily for the sake of resale, and in fact hoping not simply to retain value but to increase it. (True, many collectors buy drums simply to possess them, but in that case resale isn't an issue.) At the end of the day it's still about supply and demand -- as you said, scarcity and collectability -- subject to market timing, and with vintage gear you're looking at very limited supply, no matter what the brand or model.
 

Tama CW

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Since when did resale value have to include a discussion of the Dow? Apples to Oranges. But since you brought it up let's not forget that the Dow is a "beacon" to attract investors. Unlike most other "investment" classes (including collectibles and physical hard assets)
the Dow gets to "kick out" the sluggish performers every few years and add new hot-runners. In reality, the "Dow of 1963" if re-constituted today would not have a return anywhere near the 4,633% of the "constantly changing" Dow. Might be half that amount or a third of it....or even less. Big Tech and Big Finance since the 80's have propelled the Dow. Let's put the 1963 Dow components back in today's mix and see how it really did (ie Sears, Woolworth, GE, Kodak, Bethlehem Steel, US Steel, Goodyear, Chrysler, Texaco, to name a few). I've studied the returns of the "best" of the rare coin market since 1963 and for the truly scarce and investment grade pieces they have increased from 50x-100x in that period (5,000-10,000%). Even simple things like Gem Red Indian Head cents minted from 1900-1909 those have gone from $3-$5 in 1963 to $350 today (70X increase). We could create the same argument for art, antiques, rare cars, rare guns, rare dolls, sports memorabilia, etc.

Of the 1960 Dow only a couple of those members are in the index today. Too bad the "drum collector's index" doesn't get to choose the winners along the way like the Dow does and get rid of the losers. If that were the case we'd have an index with Ludwig and Slingerland 1920's BB's, Slingerland RK snare drums, Gretsch RB 12,14,18 kits, and Ludwig 60's black oyster kits. If they get to pick the Dow "winners" over 58 years, I should be able to cherry pick the best of the best drums/percussion since 1963 as well.
 
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Tama CW

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We're both talking about supply and demand, but I'm also saying that timing of the sale is a factor. I actually bought a brand new Slingerland 12, 14, 20 kit in 1963 -- my first serious drum set -- and it sold for $440 (per 1963 catalog). The Gretsch equivalent sold for $474 (per 1963 catalog. The equivalent Rogers kit sold for $527, possibly a few dollars more (per 1962 catalog). Note that these are all the "special prices" for the kits, not the "regular" prices. So they were not the same price to start with.

Meanwhile, cumulative inflation 1961-2021 was 798%, so translate these prices to today and they would be $3,511 for Slingerland, $3,783 for Gretsch, and $4,205 for the Rogers.
Are there drums that you could have purchased in 1963 at retail that would be worth 50X or more today to have kept up with the Dow? Surely there are. Since we are talking vintage "collectibles" no new kits in 1963 would have been considered in our
selections back then. Just like you had no choice but to buy the entire 1963 Dow 30 in the analysis. Drums selected would have been only prime time 20-60 yr old examples. Things like Gladstone, Black Beauty and Fancher tone snare drums or
Ludwig Top and Cane drum kits and the like. I can only imagine how dirt cheap great collectible drums were in 1963....many just being given away or posted for sale in antique ships for $5-$10 per drum. Can rare and scarce drums be chosen wisely to be
very good investments? Yup. But you have to have a great eye, insider knowledge, and a feeling for what's under-priced or how things will trend. Collectibles had a great run from the 1960's to around 2008. We will likely never duplicate that period again
in the vast majority of collectibles. But for that time, they did compete with the best of the ever-changing Dow.

The ratio of those new '63 catalog prices of Slingerland, Gretsch, and Rogers don't hold true today when comparing those same kits used. It's not even close. That was my primary original point. The Rogers and Gretsch bring MUCH larger premiums over Slingerland today than those "new kit" 10-20% premiums of 1963. Trying to ratio them back to '63 is pretty inaccurate.....esp. for Slingerland. The Gretsch progressive jazz kit probably brings nearly 2X the price of the Slingerland today. The Rogers a bit less than the Gretsch....but FAR above that original +20% ratio. Original purchase or catalog price often has nothing to do with how a collectible fares over the years. It's about scarcity and then demand. And that demand can be radically altered by public perception....accurate or inaccurate and mania's. New information is always coming to light to adjust what market realities and perceptions are.
 
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