National Pawnbroker - Fall 2019 by National Pawnbrokers Association

Pawnbroker National

Official Publication of the National Pawnbrokers Association

FALL 2019

FIREARMS “MUST-DO’S” FOR SUCCESSFUL PAWNBROKERS PAWN EXPO 2019

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message from the president

Membership and Participation Are the Keys

Kerry Rainey NPA President bpjgems@yahoo.com

I WOULD LIKE TO TAKE THIS OPPORTUNITY to thank you for the vote of confidence in electing me as the new NPA President. I would also like to thank my fellow past president, Tim Collier, for serving the past two years and for his dedication to the association. I am excited to work with a knowledgeable Board of Directors and dedicated staff, and am looking at the future of our association which looks exceptionally bright. Our theme at this year’s Pawn Expo was “Waves of Change”. The positive changes that we make for our association will ensure that we continue and expand. Although we are coming home from another successful Pawn Expo in Las Vegas, the NPA Board and staff are looking at our future and the goals that the last administration initiated. With strategic planning, we can set a direction for us to continue. The new Board will be expanding on these goals, which include the dedication to, and the promotion of, our next Pawn Expo. Active participation is the key. This year’s Pawn Expo was a success with both an increase in new pawnbroker members and new vendors. This success equates to new revenues being generated which are crucial for the NPA to provide for its members and to develop stronger resources. Moving forward, membership must be the priority. Without members, the NPA is an ocean without waves, a body that becomes motionless and stagnant. We must remain active in the pursuit of a stronger association. We need new members, their ideas, and

their dedication and input to continue to propel us. We should always be focused on the future. The industry continues to evolve, and with this evolution, comes change. We must be prepared for these changes. Our association is only as strong as our membership and as our membership grows, our voice becomes larger. It is that voice that will help us when we look at problems that arise at the federal level. Other goals, no less important, are to gain commitment from our members to serve and be active participants within the organization. The organization should not run on the ideas and voices of just a few, but should represent each and every member. Active participation increases membership because the members are vested in the organization’s success. I would like to see the NPA succeed in accomplishing these goals. I am very excited about the current members, committees, and boards, and believe that with these attainable goals, we will bring both success and progress to the NPA. I would like to personally extend an open invitation to all members to express their ideas, serve on committees or boards, or work directly with the Pawn Expo chairman to make next year’s convention exceptional. Our association is not, and will not be, stagnant, and will continue to make these waves of change with a strong dedicated plan for success. I cannot reiterate enough that membership is the key! I am excited to serve as your president and I look forward to serving you.

FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

contents Fall 2019

Certified Pawn Professional (CPP)

HIGHLIGHTS

Firearms “Must-Do’s” for Successful Pawnbrokers Pawn Expo 2019

Message from the Executive Director

Business Solutions

Defining a Diamond

Want More Time and Money?

MultiStore Owner Profile: 33

Customer-Focused

Employment Law

Products

Security Six

Board of Directors

34 37

NPA Mentor Program

Books About Pawn

New NPA Members

State Association Updates

Community Involvement

Pawnbroker – Ruby Mountain Pawn

Industry Partner – Watch Certification Services

Pawnder This

Book Corner

FBL Scholarship Winners

Calendar of Events

Bringing Dignity to the Homeless

Advertiser Index

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

Allison M. Benz Jackson Lewis P.C.

Chad Carter Chad’s Pawn Shop Felice B. Ekelman Jackson Lewis P.C. Joshua Freedman Robert Frimet RMF Consulting IRS Tax Outreach, Partnership & Education

Young Pawnbroker to Watch – Chelsea Burnette

Contributors for this issue of National Pawnbroker John Bocker FFL Consultants

NPA 2019-2020 NPA Annual Awards

Cybersecurity and the

Using Promotional

Keeping an Eye on Capitol Hill

5 Recent Trends in

Member Spotlights

Clutter-Free and

Compliance Corner

Membership 1

Government Relations

Message from the President

Johnny Frederick

New CPP Graduates

Compliance

IN THIS ISSUE

Cover Story Stress In the Workplace 24

Rudy Klancnik Douglas J. Klein Jackson Lewis P.C. Tally Mack Bravo Pawn Systems Scott Marshall Apperson Boyd Naylor Bali Credit Corp Kerry Rainey Bayou Pawn & Jewelry

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message from the executive director

NPA staff

Fall Back and Spring Ahead FALL IS A WONDERFUL TIME here at the NPA headquarters in Texas. We get a chance to relax for a few minutes now that our biggest convention, Pawn Expo, is over before we start planning for the next one. Our minds are filled with questions like how could we do it better, what sessions were liked the best, and did we have enough drink tickets? With new education sessions, 22 new exhibitors, over 90 first-time attendees, a Wednesday lunch on the trade show floor, and a new Dana Meinecke trade show floor plan, there was a lot to review. But all NPA Executive in all, we were happy with the convention and hope that Director you were too if you attended. Pawn Expo will be in Las Vegas again next year, but we will be moving to the Paris Hotel. Look for more information this fall and be sure to mark your calendars for Pawn Expo 2020 June 23-25! I would like to extend my congratulations to the three pawnbrokers who received their Certified Pawn Professional (CPP) designation at the annual membership meeting on Tuesday, July 9. The new recipients are: nS teve Carver, AmeriPawn, Richmond, VA nS ean Makovsky, Brittex Financial, San Antonio, TX nL eo Rayos, CashCo Pawnshops, San Diego, CA As we look ahead, the NPA will continue working on the strategic plan that was developed last year. We heard from many Pawn Expo attendees who expressed an interest in getting more involved and we welcome their help. Committees are being formed now for the upcoming year, so if you are interested in serving, please contact me at Dana@NationalPawnbrokers.org. One of the “priceless” membership benefits offered to members is the NPA Mentor Program. If you’re relatively new to the pawn industry and would like some one-on-one guidance from a pawn pro, get a mentor. If you’re a 20-year pawn veteran and want to expand your horizons, bounce ideas off another veteran, or quiz a young pawnbroker on new technology ideas, get a mentor. Guidelines and applications can be found online in the Members Only area on the NPA website. For more information on the program, see page 47. If you have any questions, call me at (817) 337-8830. Finally, I’d like to personally thank all of our Pawn Expo 2019 sponsors for their generous support. Their financial backing helps us provide our members with the education and services they need to succeed. n National Shooting Sports Foundation

n Wexler Insurance

n Dia Trendz

n Data Age/PawnMaster

n Jewelers Mutual Insurance

n Marshall & Sterling Insurance

n Simplex Diam

n Bluestone Trading Company

n Geib Refining

n Kutak Rock LLP

n Palak Diam

NATIONAL PAWNBROKERS ASSOCIATION

Dana Meinecke Executive Director Dana@NationalPawnbrokers.org

Helen Moore Director of Meetings & Events Helen@NationalPawnbrokers.org

Margie Swoyer Director of Communications & Marketing Margie@NationalPawnbrokers.org

Brittany McCorkle Member Services Program Coordinator Brittany@NationalPawnbrokers.org

Amy Kehoe Administrative Assistant Amy@NationalPawnbrokers.org

Mailing Address: PO Box 508, Keller, TX 76244

Physical Address: 2920 W Southlake Blvd, Ste 120 Southlake, TX 76092 Phone: (817) 337-8830 Fax: (817) 337-8875 NationalPawnbrokers.org National Pawnbroker is the official publication of the National Pawnbrokers Association (NPA), and is published quarterly. No part of this publication may be reproduced without the written consent of Dana Meinecke, NPA Executive Director. Sale or distribution of any or all of the contents of this magazine is prohibited. All rights reserved. For more information on advertising or to obtain additional copies of National Pawnbroker, call (817) 337-8830, or send an email to Margie@NationalPawnbrokers.org. For membership information, email Brittany@NationalPawnbrokers.org EDITOR’S NOTE: This publication is designed to provide accurate and authoritative information on the subject matter covered. It is provided and disseminated with the understanding that the publisher is not engaged in rendering legal or other professional services. If legal advice is required, the services of a competent professional should be sought. Expressed opinions are those of the author and do not necessarily reflect the views of ownership. © 2007-2019 National Pawnbrokers Association: PO Box 508, Keller, TX 76244, (817) 337-8830 NationalPawnbrokers.org EDITOR: Margie Swoyer DESIGNED BY: SPARK Publications

FALL 2019

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government relations

Keeping An Eye On Capitol Hill

I Boyd Naylor NPA Vice President Chairman, NPA Government Relations Committee

t was a pleasure to visit with many NPA members during this year’s Pawn Expo. If I didn’t have a chance to meet you, or you were not able to attend this year, let me express what a distinct honor it is to be elected as your NPA Vice President, and designated as Chairman of the Government Relations Committee. As for a little about myself, I am married to Alison, whose family has been in the pawn business for over 50 years, and we have three sons. As President and coowner of Bali Credit Corporation, we have operated five pawn stores in the San Antonio, TX area since 2000. For the previous 15 years, I practiced law in El Paso and am a member of the State Bar of Texas. In addition to the NPA Board of Directors, I also serve on the Texas Association of Pawnbrokers Board of Directors. Now that we all know each other, I want to thank everyone who stopped by the GRC booth at various times during Pawn Expo to bring legal, regulatory, and government issues to our attention. As always, our Team GRC relies upon your input and communications to determine the direction and extent of efforts to keep the pawn industry strong and viable. To touch on some areas Team GRC continually monitors, we do not see any prospects available at all to amend the Military Lending Act (MLA) or the Department of Defense (DOD) Regulation that implements it. We recently learned that another Virginia pawnbroker received a CID (Civil Investigative Demand) from the CFPB pertaining to alleged violations of the MLA. The GRC Update we issued on May 30 informed you of this and served as a reminder to review your compliance

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

with the MLA and the DOD Regulations. Meanwhile, our Government Relations Liaison, Fran Bishop, continues a dialogue with Pentagon personnel that keeps the lines of communication open there. On Capitol Hill, bills have been filed placing a cap on the APR. Senator Bernie Sanders’ bill is S.1389 and was introduced in May. It places either a limit of 15% APR, or the maximum rate allowed in the state where the consumer resides. The latter might sound better than it really may be as it is unclear whether that means just the rate of interest or all allowable finance charges. Obviously, it is uncertain whether pawnbrokers would be okay or not. There is a ‘companion’ bill in the House sponsored by Rep. Alexandria OcasioCortez, H.R. 2930. Senator Durbin has filed S.1230 “Protecting Consumers from Unreasonable Credit Rates Act of 2019” to amend the Truth in Lending Act to establish a national usury rate for consumer credit transactions.

The bill provides that no creditor may make an extension of credit to a consumer with respect to which the fee and interest rate exceeds 36%. Currently, there are three additional sponsors – Senators Merkley, Blumenthal, and Whitehouse. We are, of course, watching for any movement of these bills while continuing to make Congress aware of the discontinuance and termination of services to pawnbrokers by banks. We have had success in providing information and concerns to Senate and House offices for their use in the questioning of federal banking regulators during hearings and for the record. Your input on these issues and others is very important, so please continue to communicate with Fran Bishop (fbishopdp1@gmail.com). She keeps Team GRC informed so our lobbyist, Cliff Andrews, can communicate with appropriate Members of Congress, and our Regulatory

Counsel, Professor Sarah Jane Hughes, has ‘pawn info background’ as she reads all bills when they are filed to determine those of possible relevance to the pawn industry. This collective information is regularly brought to the Government Relations Committee that I am honored to Chair. The advocacy this group performs on your behalf, and the entire pawn industry for that matter, is nothing other than ‘priceless’ in my opinion. I hope you are all of the same thought as this work is what allows us to stay in business, serving our customers, providing employment, and supporting our families. This is why contributions to the NPA PAC are of vital importance. As it’s already in the news every day, the 2020 elections will be here before we know it. I encourage you to write that personal check or use your credit card. No amount is too small to fund the NPA PAC, so we can continue ‘Keeping the Industry Strong’.

FALL 2019

“I want to thank everyone who stopped by the GRC booth at various times during Pawn Expo to bring legal, regulatory, and government issues to our attention.”

NATIONAL PAWNBROKERS ASSOCIATION

Photo by Matthew Henry. From Burst.

young pawnbroker to watch

Chelsea Burnette Vice President of JRD Companies, Inc (including Superior Pawn and Superior Guns and Range), Hampton, VA Years in the pawn industry: 8 How I got started in the business: In 2011, I moved back to the U.S. from South Korea and helped my uncle during the holiday season. I continued to help out at my father’s store in 2012 and began full time in 2013. The best advice I ever received: Own my decisions, and if I could back them up, I would be fine. I have found myself offering that advice to my employees. Greatest accomplishment in my pawn career: Building our loan balance and helping to shape the culture of our company. My favorite part of being a pawnbroker: My customers. Knowing how our business can help them makes me feel incredible. My media mix: n Musical artists - It changes daily, but I am

listening to Lizzo a lot lately. n Social media - Instagram n TV shows - Handmaid’s Tale, Outlander

My role models: My parents My favorite movie: Period films like Pride and Prejudice and Jane Eyre NPA members would be surprised to know that: I worked at The Living Theatre in New York for a short time while I was in college. When I’m not at work: I spend time with my friends and family. If I wasn’t a pawnbroker: I would have pursued teaching English as a second language.

FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

community involvement

Aubrey Gage Kempton, Bainbridge, GA, receives a $1000 scholarship from NPA’s FBL scholarship program. Aubrey was sponsored by American Pawn & Jewelry, Bainbridge, GA. L to R: Amanda Black, Aubrey Gage Kempton, Michael Rentz

2019 FBL Scholarship Winners NPA’s Future Business Leaders (FBL) scholarship program proudly announces five winners of this year’s $1000 scholarships. RECIPIENTS Savannah Garris Sponsor: Garris Specialties, Inc Birmingham, AL

Julia Newberry Sponsor: Johnson Brothers’ Jewelry & Loan Mansfield, OH

Austin Hipps Sponsor: Larry’s Jewelry & Pawn Huntsville, AL

Bryce Daniel Walter Sponsor: Pawn Plus, Inc Macomb, IL

Aubrey Gage Kempton Sponsor: American Pawn & Jewelry Bainbridge, GA Since 2003, the FBL scholarship fund has

If you would like to contribute

To learn more about the

presented more than $155,000 in scholarships

to the FBL scholarship fund,

FBL scholarship program, visit

to deserving students. All scholarships

please send your tax-deductible

NationalPawnbrokers.org; click

are completely funded through NPA

contribution to:

on the About tab, then on the

member donations and are given annually

NPA

Future Business Leaders link under

to the children, grandchildren, customers,

Attn: FBL Scholarship Fund

Community Outreach.

employees, or individuals sponsored by an

PO Box 508

NPA member in good standing.

Keller, TX 76244

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

Bryce Walter accepts a $1000 FBL scholarship. He was nominated by Pawn Plus, Inc, Macomb, IL. L to R: Bob McCullough, President, Pawn Plus, Inc; Bryce Walter; Macomb Mayor Mike Inman

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pawnbroker spotlight

Ruby Mountain Pawn RAISING THE BAR IN THE SHADOW of the Ruby Mountains in Elko, NV, is a pawn store aptly called Ruby Mountain Pawn. The store opened smack dab in the heart of cowboy/mining country in October 1998 under the wise leadership of Jeni-Lei Powell. Jeni-Lei had a lot of experience running several different businesses, including two pawn stores, before opening Ruby Mountain Pawn. She dons many hats— from president to janitor and everything in between— and employs up to five people. “My pawn heroine was P. Taylor Fletcher. Her book, Business Under the Balls, answered questions I couldn’t get from others in the industry,” Jeni-Lei says. “Her words in her forwarding message have been the wisdom that has guided my business practices.” National Pawnbroker (NP): How has the industry changed since you started? Jeni-Lei Powell (JLP): Asking how much the industry has changed in 30 years is like asking how many wrinkles I’ve gotten in as many years. When I started, I would get the Sunday newspaper from different places just to get the sales ads. I would cut out the items with the prices and pictures and put them into a sticky photo album. These were my “blue books” for current market values on everything from car stereos to TVs to firearms. Pawn slips were hand written. I got my first DOS-based pawn program in 1991 just for entering items into a fillable format to print on a pawn ticket. Back then, law enforcement would randomly show up to see if 12

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

Jeni-Lei Powell, Ruby Mountain Pawn, Elko, NV

anything we had might be on their reports. Gun logs were all hand written and the ATF showed up every four to six months to do full audits. Now, everything is computerized. NP: What is your biggest challenge as a pawnbroker? JLP: Trying to keep up with the pace of change. I have a Master’s [degree] in business management, but I can’t say it’s helped. Besides trying to stay current on laws, compliance, trends, marketing, etc., the next challenge is taking time to replenish myself. Very rarely do I spend less than ten hours a day, six days a week, punched into the time clock. NP: How does your company give back to

the community?

JLP: As a military brat, I have always contributed to active and retired military programs. I am a drop location for Cell Phones for Soldiers and head up our local O.P.P.S. (Operation Purple Provider Service), shipping care packages to deployed soldiers via Purple Providers. As a Purple Provider, we also help provide care packages for those going through cancer treatment. I run the Purple Provider LLC program out of the pawn shop which allows for easy cross promotion. People aren’t very willing to help a “pawn shop” raise funds, but in my experience, they will give it to a program or organization.

NP: What advice would you give to someone thinking about opening a pawn store? JLP: Learn the Toltec Wisdom of the Four Agreements. Look at the market area of where you will have your shop, what types of businesses are thriving, and what are they selling. Get knowledgeable about those items. Las Vegas has a lot of pawn shops that do 90 percent jewelry. Why? Because that is what people bring with them in their suitcase when they come to gamble. It’s what they buy when they win that they can take with them. Finally, be disciplined with your finances and your time.

NP: What do you think the future looks like for

NP: Why are you a member of NPA? JLP: Ethics, integrity, numbers. One of my mantras is

the pawn industry? JLP: There will always be a place for small dollar, short term loans. Keeping our government educated on the niche we fill that banks, credit cards, and they themselves don’t have resources to address, will always be our plight. As for the ability to market and sell the collateral we obtain, that too is up to us.

“Don’t just reach the bar, raise it.” NPA’s Code of Ethics encourages pawnbrokers to do just that. I have it posted on my show room wall for customers to read. The NPA focuses on our industry and educating our government about our needs as pawnbrokers and businesses, thus numbers.

FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

business solutions

Defining a Diamond Do the 4Cs Still Make the Cut? by Joshua Freedman

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

When it comes to diamond grading, a new book claims 4Cs are no longer adequate to accurately access the price of a diamond. Ever since their debut in the early 1940s, the 4Cs of color, clarity, cut, and carat weight have been the benchmark terminology used to grade diamonds. However, Renée Newman, author of a guide for the diamond trade, believes there’s a need for a fifth C and two Ts. And while her proposed “5Cs and 2Ts” isn’t as catchy as the standard formula, she believes it might be a better method for pricing diamonds more accurately. “One of the biggest misconceptions is that there are only four diamond price factors — color, clarity, cut, and carat weight,” says Newman, a graduate gemologist who last year published the third edition of her Diamond Handbook. “In fact, there are other factors, such as the transparency and treatment status. They can have a large impact on price. We [in the trade] may know that, but the consumers don’t, because they just hear about the 4Cs.” The Gemological Institute of America (GIA) developed the 4Cs nearly eight decades ago, when the industry considered cloudy diamonds to be industrial quality and didn’t put them into jewelry, the Handbook explains. However, today, jewelers do use cloudy and hazy diamonds, but their clarity grades often don’t reflect their lower transparency, even though that characteristic can affect the value. Newman distinguishes between clarity — a stone’s lack of inclusions and other blemishes — and the first “T,” transparency, which is how well it lets light pass. While a diamond with high clarity will have few or no inclusions, a stone is transparent if a viewer can see objects through it distinctly. Many laboratories don’t take into account subtle differences in transparency, Newman writes. “I’ve seen hazy and slightly cloudy diamonds with VS clarity grades,” she notes in the book.

Very few treated diamonds were on the market when the 4Cs came along, Newman explains. Most diamonds are still untreated now, but it’s becoming a larger minority as sellers seek to improve stones’ color, clarity, and transparency. This second “T” (treatment) is important, as it hugely impacts the price. An untreated 1-carat, fancy-green, VS-clarity diamond will often fetch more than $200,000, compared with around $5,000 for an irradiated diamond with otherwise identical characteristics, Newman estimates. Treated diamonds are also much harder to resell. The “cut” part of the 4Cs needs to be two separate categories — cut shape and cut quality, she argues. In the 1950s, the trade didn’t differentiate between the shape and the quality of the cut when deciding prices, so it didn’t matter that the same term referred to both things. Now, the cutting style and shape are a distinct price factor from cut quality, with many labs providing a grade for the latter, she observes. Meanwhile, rising interest in lab-grown diamonds has prompted Newman to consider an eighth criterion for a revised edition of one of her other books aimed at consumers. “I left out a ‘C’ that I’m going to add when I redo my Diamond Ring Buying Guide, and that is the creator. Is the creator man or nature?” Newman is not trying to get traders to discard their 4Cs charts, as the system is so ingrained, she notes. But they should be aware of the additional elements affecting the value of a diamond. That’s why she emphasizes the 5Cs and 2Ts in the Handbook. “They can’t just completely change over all their advertising and all the materials they have, so I don’t expect people to change the 4Cs. But I do expect them to understand all the price factors,” she concludes. FALL 2019

Renee Newman, author of Diamond Handbook

NATIONAL PAWNBROKERS ASSOCIATION

business solutions

Understanding a Diamond’s True Value The 4 Cs have long been the industry standard for determining the value of a diamond. But the characteristics of color, clarity, cut, and carat are far from equal when it comes to valuation.

The importance of a diamond’s cut grade has resulted in manufacturers constantly targeting a triple EX – excellent cut, polish, and symmetry – grading.

The first three Cs are fairly straightforward, referring to weight size, color purity, and number of inclusions in a diamond. However, cut is a more nuanced characteristic, referring to the quality of proportions, symmetry, and polish of a diamond. It ultimately has three primary effects on appearance. Cut impacts brilliance, the brightness which light reflects from the surface and inside the polished diamond. It affects fire, the dispersion of light into flashes of color. And it gives a diamond its scintillation, the sparkle it gives off when moved. But cut can also add a lot more. “Good cut hides other flaws in the color and clarity of a diamond,” explained Bill Boyajian, a former president of the Gemological Institute of America (GIA) who is now an independent consultant to the industry. He believes that cut is the most important factor contributing to the value of a diamond. “Today, you can’t get away with cutting a poor stone.” The importance of a diamond’s cut grade has resulted in manufacturers constantly targeting a triple EX – excellent cut, polish, and symmetry – grading. This has increased the supply of diamonds with the triple EX grading and actually diminished the exclusivity factor of those goods, according to David Wolf, president of Just Appraisers, a New York-based appraisal company. “Given that round diamonds have become fairly standardized and easy to find, large,

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

more exclusive fancy shapes tend to hold their value better as they are more difficult to replicate or replace,” according to Wolf. There is a difference, however, when valuing a diamond for a consumer, because consumers are less knowledgeable about cut grade. As a result, they tend to emphasize carat size, color, and clarity, while overlooking cut, Wolf explained. That’s become especially evident as consumers have greater exposure to diamonds online and come armed with prices and information, Boyajian noted. It’s important to explain the 4Cs so that the consumer doesn’t just rely on the grading report, he stressed. “The goal in presenting standardized and more accurate grading was always to better serve the consumer,” Boyajian said. “What the consumer doesn’t realize is that the stone they find online is not a representative of all goods on the market as it doesn’t present the subtleties found in each individual stone. So, ultimately, you still need a professional to buy a diamond.”

The Rapaport Group is an international network of companies providing added value services that support the development of fair, transparent, competitive and efficient diamond and jewelry markets. The Group supports over 20,000 clients in 121 countries and has offices in New York, Las Vegas, Antwerp, Ramat Gan, Mumbai, Surat, Dubai, and Hong Kong. Additional information is available at www.Diamonds.net.

Tips on Tes)ng Jewelry Scrap By Jack Brown - Opera0ons Manager, Mid-States Recycling & Refining An Alarming Trend There is a con0nuing evolu0on and sophis0ca0on regarding the types of jewelry alloys you will encounter in your scrap buying. With higher metal prices, even legi0mate manufacturers are trying to find ways to reduce their wholesale price of newly finished jewelry. Competent tes0ng of jewelry scrap is one of the most important skills a pawnbroker must have to avoid making expensive mistakes when purchasing or loaning on karat gold materials. When scrap comes in to us for processing, we always do a cursory visual and magnet inspec0on on each and every refining lot. Some0mes we’re not able to iden0fy bad pieces of material un0l aJer the melt is completed, when we find un-melted stainless steel, tungsten, 0tanium or similar hi-temp jewelry pieces in the boKom of the mel0ng crucible. Recently, we were surprised to see a wedding ring made of 58.5 Pla0num! Here are 4 important 0ps to help you iden0fy fake materials. Tip #1 – Beware of Heavily-Plated Materials Tip #2 – Keep Your Tes)ng Acids Fresh In recent years, we have started to see more heavily plated jewelry material coming in, most oJen over brass or sterling silver. These items are easily overlooked because they will not aKract to a magnet and the person tes0ng the piece oJen chooses not to file into the metal to do a proper acid test. A perfect example - a Mid-States pawnbroker customer recently came in to witness an 80 oz. melt of materials he was told by his customer was gold-filled chain and assorted jewelry pieces that were sales samples from a reputable line of jewelry products. All of the material looked brand new and was of iden0cal color and finish, but had no stamps or markings on the clasps. The material did not aKract to a magnet, as most goldfilled material oJen will, so I decided to shoot a piece on two of our XRF's. Both instruments showed gold in the 42% range with copper and zinc present as well, but oddly no silver. This indicated we could be dealing with 10k material even if the alloy was somewhat nontypical of most karat gold alloys. As a secondary test, I took the chain out to the bench grinder and made a deep cut into the surface and hit it with 10k tes0ng acid. The reac0on to the acid was very subtle and did not "red flag" it as being anything other than karat gold. Well, you can imagine how happy the pawnbroker was and how his expecta0ons changed, now thinking his gold-filled lot was actually all 10k. Long story short, the material ended up assaying in the 2% range

as he originally expected, and I immediately replaced our set of tes0ng acids. Lessons learned - fake jewelry can be plated thick enough to fake out even the most sophisticated tes0ng instruments and always make sure your tes0ng acids are fresh. Tip #3 – The Smell Test Perhaps the best tes0ng 0p I've learned - and the most simple - came from Mr. Michael Elliot, one of the smartest gold buyers I've known. Roughly a decade ago, there was informa0on that people were going around to pawnshops selling thick, heavy white metal, Rolex-style link necklaces with all of the typical Rolex markings and an 18k stamp on the clasps. When a Mid-States customer brought it in with his scrap lot, we immediately recognized it as a suspect item that we had seen and heard about. With our X-ray instruments, we were quickly able to confirm that it was indeed a stainless steel fake. The pawnbroker did all the proper tes0ng. It passed the magnet test. It held up to 18k acid. But even more interes0ng, it held up to 22k acid as well, which should have been a clue. The pawnbroker bought the necklace for $1400. He allowed us to keep the piece to show other pawnbrokers and gold scrap buyers. At an NPA Conven0on, Michael Elliot stopped by our booth to say hello. When he saw the piece, he told me to pick it up, cup it in my hands, and briskly rub my hands together to warm the metal. Then he told me to open my cupped hands just enough so I was able to smell inside my closed palms. It smelled exactly like scrap iron! Gold is odorless. How simple was that? Tip #4 - Share Informa)on & Train Your Employees For all pawnbrokers, sharing informa0on is extremely important – and employee training must be con0nuous. If your refiner iden0fies any bad pieces they discover in your scrap, whether it's before or even aJer the melt, have them return it to use in your training. An Important Ar)cle For You A great ar0cle from several years ago - "Pawnbrokers Guide to Metal Tes0ng" by Mr. Art Arbu0ne from Bellair Coin, Largo, FL - offers a complete and detailed explana0on for spot tes0ng virtually all material types one would ever encounter as a pawnbroker or 2nd hand buyer of jewelry. This is cri0cal reference material that every pawnbroker should have on hand and use in their employee training. For a copy of the ar-cle, just reach out to me directly at jbrown@midstatesrecycling.com and I'll email it to you right away.

MID-STATES RECYCLING & REFINING 1841 BUSSE HIGHWAY DES PLAINES, IL 60016

847. 298.0010

MIDSTATESRECYCLING.COM

industry partner spotlight

“The counterfeit production of watches has shifted from the cheap knock-off to a centralized focus on increasing quality.”

Checking the Time W WATCH CERTIFICATION SERVICES

Anthony Fabiano, President, co-founder of Watch Certification Services

atch Certification Services has been providing authentication services for pawnbrokers for 10 years. Anthony Fabiano, along with Martin Bruno, founded the business and launched it at Pawn Expo in 2009. They were Swiss watch dealers who helped pawnbrokers and jewelers authenticate over the phone back in the day when texting images of watches was science fiction. When the recession hit and new watch sales plummeted, they decided to forge a new path creating a better way for people to verify watches. The Florida-based company offers an array of products that allow pawnbrokers and jewelers to verify watches they are purchasing. They offer a known counterfeit database, an authenticating system for over 180 different Rolex models, tools for pricing over 8,000 pre-owned watches, online employee Swiss watch training, and access to Certified Pre-owned reports for their inventory. While Anthony resides in the San Francisco Bay area, Martin is out of West Palm Beach, Florida, so with today’s technology, they’re able to cover the entire country. In the last 10 years, the counterfeit production of watches has shifted from the cheap knock-off to a centralized focus on increasing quality, shares Anthony. “Counterfeiters now see that if they produce a product that visually, with the naked eye, is 100 percent correct to the original in

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terms of dimensions, markings, and physical presence (how it feels, weight, etc.), they have something they can charge $800$1,200 per unit for. That translates into a fake that a fraudulent individual can buy for $1,200 and potentially pass on to you at $5000-$10,000.” He adds, “Watches produced from steel do not have micro-hallmarks like gold and from a manufacturing standpoint, are much easier to work with. All this has created a market shift from the cheap steel knock off of the past to a market trend where the top stainless-steel models within a brand will have a super-fake ‘beast’ of a watch. And, it’s these ‘super-fakes’ that burn pawnbrokers who are not consistently up-to-date on the rapidly changing and evolving third tier fake watch.” What can pawnbrokers do to keep from getting scammed? It’s really a no-tolerance policy, says Anthony. “Any one thing you find during an authentication that doesn’t look right negates the 99 other things that look good. It has to be a 100 percent ‘all good’ feeling, and the gut check is an amazing tool. In the authentication steps, you absolutely have to keep the thought of profit out of the mix. The second thing is to be organized. You have to have a checklist of areas that you always validate, one by one. And, this must include those tricky little areas that the counterfeiters do not finish (the walls between the case lugs, the back of a flip

lock, the reverse side of a clasp, etc.). Lastly, the devil’s in the details, meaning you have to be a detective in the sense that you look at the quality ‘within’ a marking or stamp’s boundaries. The counterfeiters use the same tooling to produce vast quantities of pieces without re-tooling. The end result is poor quality at the micro level. An example would be looking at the surface within the numbers on a ceramic Rolex submariner bezel. Visually, it could be very difficult for an individual to see the difference between a genuine ceramic bezel versus a fake ceramic bezel. But, the inner surface does not lie and tells all. The fake’s finished surfaces at the micro level (10x loupe) will confirm your direction and you do not have to be a watch expert to be an effective evaluator.” Watch Certification Services differs from its competitors because it’s the only company using data, and programming that data to reduce counterfeit watches, according to Anthony. “We focus on

transparency, dedicated to helping the pawnbroker, avoid the fake, price it, and any consulting that helps them generate profit in the sale of that piece.” If you are interested in learning more about Watch CSA, avoiding fake watches, or have questions about getting into watch buying, get more information at watchcsa. com, calling (888) 937-9272, or emailing Anthony at a.fabiano@watchcsa.com.

THE FUNDS YOU NEED TO GROW YOUR PAWN SHOP Discover PawnBroker Financing (“PBF”), a direct lender to the pawn

Financing options for the Pawnbroker Industry are typically limited and very restrictive. PBF allows owners in the pawn industry to obtain the cash they need in a timely manner. “Get a Fast Approval for your Pawnbroker Line of Credit”.

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business solutions

17 Firearms Must Do’s to Create Success for Pawnbrokers by John Bocker, FFL Consultants

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s with any business, the dynamics of being successful in the pawn business are ever changing. A few years ago, the hype was all about gold and precious metals, but now I’m hearing more and more that the value focus is on diamonds, collectables, authentic luxury items, and firearms. So, if that is true, what does a pawnbroker need to know to be successful when accepting firearms for collateral or when selling firearms? We’ll tackle this area by first addressing why firearms can be a value-added category for your business. You won’t get rich, but you’ll expand your collateral and provide convenience to your customers!

Before we discuss the technical and legal aspects of accepting guns for pawn, consider why it might be a good idea to either jump in or create a bigger focus around this category. First, marketing is very inexpensive as you already have pawn customers visiting your location. Next, it provides yet another category for collateral to loan against. Third, many customers pawning firearms may not realize the hidden value of older classic firearms. Fourth, many spouses don’t want to have guns “in the house” after a loved one passes that they don’t know how to use, and are willing to hand off at very low prices to dealers who advertise “we buy guns”. And finally, your shop may be more convenient and comfortable for your clients to shop versus traveling to the big box gun store across town. Keep in mind though that most retailers who deal in firearms don’t actually make much profit from selling firearms themselves and actually rely on selling accessories, holsters, and ammunition to boost gun shop profits. But there are hidden profits in the used gun market, and being a gun-geek can really pay off in the pawn environment. To begin, realize that all firearms are not created equal. There is disparity in the make, quality, price, and resale value of firearms available on the market today. With more than 300 million firearms sold in the U.S. since 1968, it’s important to know the “trade” value of any used firearm. “New gun” values for anything purchased in the last decade are pretty easy to research using online retail and auction sites like GunBroker.com,

GunsAmerica.com, ArmsList.com and Brownells.com. But older guns are a different animal altogether. Knowing where you can really make some money with a classic Colt revolver versus losing your shirt by over-loaning on an older Sears shotgun takes some expertise. The most-valued resource for making smart loan and purchase decisions of used guns is the Blue Book of Gun Values (bluebookofgunvalues.com) dated and published annually. This resource provides all of the details you need to make good decisions for older model firearms based on specific marking, year manufactured, condition, scarcity, and recent auction pricing. To research any firearm before processing a loan or used-gun purchase, you’ll need some inhouse knowledge. So, whether you’re a one-person shop or have five shops in several states, you’ll need onboard expertise and experience with classic firearms which will make up a good portion of your pawned firearms. I’ve been amazed at some of the classic guns I’ve seen stored in pawnshop back rooms and the underestimated value of many pawns. But maybe that was intentional! Recently I handled a 1938 German Luger in pristine condition with an original, but worn, holster that was pawned for just $700. This classic antique, if auctioned, could easily fetch $4,000 or more! So, having knowledge of how to conduct research on classic firearms, especially foreign guns, is critical. Aside from being able to price guns correctly for pawn, inspecting the parts and functionality of every firearms is FALL 2019

Getting Started with Firearms

Survey your clientele to determine if accepting guns as collateral would offer additional loan and profit opportunities.

Apply for and obtain your Type 02 Federal Firearms Permit for $200. Consultants are available to help in this process.

From the start, create a good relationship with your local ATF office. They will be able to support you through your start-up process and answer questions along the way.

Realize that the ATF investigators can randomly arrive and inspect your firearms business records and practices unannounced once a year.

5 6

Renew your FFL every three years for $90.

Hire one or more detail-oriented employees to set up and manage your firearms transfer process (gun sales and redeemed pawns), your Acquisition & Disposition records (gun inventory), and conduct ATF Gun Traces as requested.

Research software available to help manage your Form 4473 firearms transfer and inventory processes. Several vendors, such as Bravo, Pawn Master, and Gun Store Master, all cater to the pawn industry.

Teach your firearms employees to research the value of firearms, especially older classics, antiques, and foreign firearms, using online resources.

Realize that many clients who hunt may use your store as secure storage for their firearms for months at a time between hunting seasons.

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business solutions

Stock basic accessories, like ammunition and safety locks, to boost the margin on each firearm sale, transfer, and redemption.

Research how to sell your firearms online using auction and resale sites including Gun Broker, Gun Buyer, Guns America, and others.

Train your employees to ask for, and hold, valid unexpired photo identification before showing firearms to unknown clients.

Accept online and internet firearms transfers to increase traffic into your store. This isn’t a money-maker but an easy way to attract new customers and convert online shoppers to in-store repeat clients. It’s also a great way to see what customers are purchasing online and what you should order to sell in your store.

Conduct a security assessment. Improve security programs and features if, and where necessary, as guns are a target for thieves.

Consult with your LeadsOnline contact as pawned firearms have to be reported in most states.

Include signage at your gun counter that anyone pawning a firearm for a loan will be required to pass the FBI background check process when redeeming the pawn. Post this to prevent issues later.

And lastly, remember, as a firearms dealer, you are permitted by law to refuse any sale, transfer, or pawn redemption to any person “for whatever reason whatsoever” with federal protection against discrimination or bias. This legal stature was created to protect gun dealers from unjustified or unrealistic liability issues when transferring firearms.

important. Taking in a firearm that doesn’t function correctly could be a deal breaker and pose great liability. Whether taking in firearms simply as collateral for loans or actively running a retail counter, beware of firearms needing repair. Partnering with a local gunsmith or even a neighboring gun shop or range can aid in this process. Differences in functionality and condition can easily halve or double the value of a gun. Much more information on identifying and classifying used firearms can be found at the National Rifle Association website—nramuseum.org Something critical to remember is refinishing a collectible gun, modifying it, customizing it, or over-cleaning it nearly always lowers the value. Never take it upon yourself to clean up an old gun unless you know what you’re doing, and be wary of classic and antique guns, especially revolvers, that appear brand new! It’s easy to clean and buff a $2,000 classic gun into a $200 clunker! HIGHER-QUALITY FIREARMS

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ARE HOLDING THEIR VALUE

Another good reason for taking in firearms for pawn is that highervalue, quality-manufactured firearms will increase in value as many manufacturers have cut back on classic woods and metals that were the foundation for gun manufacturers in recent decades. Wood stocks are being replaced by synthetic materials and titanium is being used to replace steel frames and barrels. Although replacing steel with titanium may be smarter and stronger, the availability of classic rifles, for example, may drive up resale pricing for collectors. So do your research because most customers walking in with family heirlooms they found in the attic or grandpa’s footlocker may have little knowledge of a firearm’s true collector value. Not only can pawn shops provide guns at generally discounted prices while still turning a nice profit, they can be a great source for antique guns and rare or hard-to-find firearms that can be sold to collectors shopping online. So, if you’re now considering (Continued on Page 61)

business solutions

Stress in the Workplace

MANAGING JOB AND WORK STRESS

hile some workplace stress is normal, excessive stress can interfere with your productivity and performance, impact your physical and emotional health, and affect your relationships and home life. It can even determine success or failure on the job. You can’t control everything in your work environment, but that doesn’t mean you’re powerless, even when you’re stuck in a difficult situation. Whatever your ambitions or work demands, there are steps you can take to protect yourself from the damaging effects of stress, improve your job satisfaction, and bolster your well-being in and out of the workplace.

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WHEN IS WORKPLACE STRESS TOO MUCH?

Stress isn’t always bad. A little bit of stress can help you stay focused, energetic, and able to meet new challenges in the workplace. It’s what keeps you on your toes during a presentation or alert to prevent accidents or costly mistakes. But in today’s hectic world, the workplace too often seems like an emotional roller coaster. Long hours, tight deadlines, and ever-increasing demands can leave you feeling worried, drained, and overwhelmed. And when stress exceeds your ability to cope, it stops being helpful and starts causing damage to your mind and body—as well as to your job satisfaction. If stress on the job is interfering with your work performance, health, or personal life, it’s time to take action. No matter what you do for a living, or how stressful your job is, there are plenty of things you can do to reduce your overall stress levels and regain a sense of control at work. Common causes of workplace stress include: nF ear of being laid off nM ore overtime due to staff cutbacks nP ressure to perform to meet rising expectations but with no increase in job satisfaction nP ressure to work at optimum levels—all the time! nL ack of control over how you do your work STRESS AT WORK WARNING SIGNS

When you feel overwhelmed at work, you lose confidence and may become angry, irritable, or withdrawn. Other signs and symptoms of excessive stress at work include: nF eeling anxious, irritable, or depressed nA pathy, loss of interest in work nP roblems sleeping nF atigue nT rouble concentrating nM uscle tension or headaches nS tomach problems nS ocial withdrawal nL oss of sex drive nU sing alcohol or drugs to cope

TIP #1:

BEAT WORKPLACE STRESS BY REACHING OUT

Sometimes the best stress-reducer is simply sharing your stress with someone close to you. The act of talking it out and getting support and sympathy—especially face-to-face—can be a highly effective way of blowing off steam and regaining your sense of calm.

Turn to co-workers for support. Having a solid support system at work can help buffer you from the negative effects of job stress. Just remember to listen to them and offer support when they are in need as well. Lean on your friends and family members. As well as increasing social contact at work, having a strong network of supportive friends and family members is extremely important to managing stress in all areas of your life. Build new satisfying friendships. If you don’t feel that you have anyone to turn to—at work or in your free time—it’s never too late to build new friendships. Meet new people with common interests by taking a class or joining a club, or by volunteering your time. As well as expanding your social network, helping others delivers immense pleasure and can help significantly reduce stress.

TIP #2:

SUPPORT YOUR HEALTH WITH EXERCISE AND NUTRITION

When you’re overly focused on work, it’s easy to neglect your physical health. But when you’re supporting your health with good nutrition and exercise, you’re stronger and more resilient to stress. Taking care of yourself doesn’t require a total lifestyle overhaul. Even small things can lift your mood, increase your energy, and make you feel like you’re back in the driver’s seat. Make time for regular exercise. Aerobic exercise is a hugely effective way to lift your mood, increase energy, sharpen focus, and relax both the mind and body. Rhythmic movement—such as walking, running, dancing, drumming, etc.—is especially soothing for the nervous system. For maximum stress relief, try to get at least 30 minutes of activity on most days. And when stress is mounting at work, try to take a quick break and move away from the stressful situation. Take a stroll outside the workplace, if possible. Make smart, stress-busting food choices. Your food choices can have a huge impact on how your feel during the work day. Eating small, frequent, and healthy meals, for example, can help your body maintain an even level of blood sugar. This maintains your energy and focus, and prevents mood swings. Minimize sugar and refined carbs. When you’re stressed, you may crave sugary snacks, baked goods, or comfort foods, such as pasta or French fries. But these FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

business solutions “feel-good” foods quickly lead to a crash in mood and energy, making symptoms of stress worse, not better. Eat more Omega-3 fatty acids to give your mood a boost. The best sources are fatty fish, seaweed, flaxseed, and walnuts. Avoid nicotine. Smoking when you’re feeling stressed may seem calming, but nicotine is a powerful stimulant, leading to higher, not lower, levels of anxiety. Drink alcohol in moderation. Alcohol may seem like it’s temporarily reducing your worries, but too much can cause anxiety as it wears off and adversely affect your mood.

TIP #3:

DON’T SKIMP ON SLEEP

You may feel like you just don’t have the time to get a full night’s sleep. But skimping on sleep interferes with your daytime productivity, creativity, problemsolving skills, and ability to focus. The better rested you are, the better equipped you’ll be to tackle your job responsibilities and cope with workplace stress. Improve the quality of your sleep by making healthy changes to your daytime and nightly routines. For example, go to bed and get up at the same time every day (even on weekends), be smart about what you eat and drink during the day, and make adjustments to your sleep environment. Aim for eight hours a night—the amount of sleep most adults need to operate at their best. Turn off screens one hour before bedtime. The light emitted from TV, tablets, smartphones, and computers suppresses your body’s production of melatonin and can severely disrupt your sleep. Avoid stimulating activity and stressful situations before bedtime, such as catching up on work. Instead, focus on quiet, soothing activities, such as reading or listening to soft music, while keeping lights low.

TIP #4:

PRIORITIZE AND ORGANIZE

When job and workplace stress threaten to overwhelm you, there are simple, practical steps you can take to regain control. Time management tips for reducing job stress

Create a balanced schedule. All work and no play is a recipe for burnout. Try to find a balance between work and family life, social activities and solitary pursuits, daily responsibilities, and downtime. Leave earlier in the morning. Even 10-15 minutes 26

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can make the difference between frantically rushing and having time to ease into your day. If you’re always running late, set your clocks and watches fast to give yourself extra time and decrease your stress levels. Plan regular breaks. Make sure to take short breaks throughout the day to take a walk, chat with a friendly face, or practice a relaxation technique. Also try to get away from your desk or work station for lunch. It will help you relax and recharge and be more, not less, productive. Establish healthy boundaries. Many of us feel pressured to be available 24 hours a day or obliged to keep checking our smartphones for work-related messages and updates. But it’s important to maintain periods where you’re not working or thinking about work. That may mean not checking emails or taking work calls at home in the evening or on weekends. Don’t over-commit yourself. Avoid scheduling things back-to-back or trying to fit too much into one day. If you’ve got too much on your plate, distinguish between the “shoulds” and the “musts”. Drop tasks that aren’t truly necessary to the bottom of the list or eliminate them entirely. Task management tips for reducing job stress

Prioritize tasks. Tackle high-priority tasks first. If you have something particularly unpleasant to do, get it over with early. The rest of your day will be more pleasant as a result. Break projects into small steps. If a large project seems overwhelming, focus on one manageable step at a time, rather than taking on everything at once. Delegate responsibility. You don’t have to do it all yourself. Let go of the desire to control every little step. You’ll be letting go of unnecessary stress in the process. Be willing to compromise. Sometimes, if you and a co-worker or boss can both adjust your expectations a little, you’ll find a happy middle ground that reduces the stress levels for everyone.

TIP #5:

BREAK BAD HABITS THAT CONTRIBUTE TO WORKPLACE STRESS

Many of us make job stress worse with negative thoughts and behavior. If you can turn these selfdefeating habits around, you’ll find employer-imposed stress easier to handle. Resist perfectionism. When you set unrealistic goals for yourself, you’re setting yourself up to fall short. Aim to do your best; no one can ask for more than that. Flip your negative thinking. If you focus on the

downside of every situation and interaction, you’ll find yourself drained of energy and motivation. Try to think positively about your work, avoid negative co-workers, and pat yourself on the back about small accomplishments, even if no one else does. Don’t try to control the uncontrollable. Many things at work are beyond our control, particularly the behavior of other people. Rather than stressing out over them, focus on the things you can control, such as the way you choose to react to problems. Look for humor in the situation. When used appropriately, humor is a great way to relieve stress in the workplace. When you or those around you start taking work too seriously, find a way to lighten the mood by sharing a joke or funny story. Clean up your act. If your desk or work space is a mess, file and throw away the clutter; just knowing where everything is can save time and cut stress. BE PROACTIVE ABOUT YOUR JOB AND YOUR WORKPLACE DUTIES

When we feel uncertain, helpless, or out of control, our stress levels are the highest. Here are some things you can do to regain a sense of control over your job and career. Talk to your employer about workplace stressors. Healthy and happy employees are more productive, so your employer has an incentive to tackle workplace stress whenever possible. Rather than rattling off a list of complaints, let your employer know about specific conditions that are impacting your work performance. Ask for new duties. If you’ve been doing the exact same work for a long time, ask to try something new: a different grade level, a different sales territory, a different machine. Take time off. If burnout seems inevitable, take a complete break from work. Go on vacation, use up your sick days, ask for a temporary leave-of-absence—anything to remove yourself from the situation. Use the time away to recharge your batteries and gain perspective. LOOK FOR SATISFACTION AND MEANING IN YOUR WORK

Feeling bored or unsatisfied with how you spend most of the workday can cause high levels of stress and take a serious toll on our physical and mental health. But for many of us, having a dream job that we find meaningful and rewarding is just that: a dream. Even in some mundane jobs, you can often focus on how your contributions help others, for example,

or provide a much-needed product or service. Focus on aspects of the job that you do enjoy, even if it’s just chatting with your co-workers at lunch. Changing your attitude towards your job can also help you regain a sense of purpose and control. HOW MANAGERS OR EMPLOYERS CAN REDUCE STRESS AT WORK

Employees who are suffering from work-related stress can lead to lower productivity, lost workdays, and a higher turnover of staff. As a manager, supervisor, or employer, though, you can help lower workplace stress. The first step is to act as a positive role model. If you can remain calm in stressful situations, it’s much easier for your employees to follow suit. Consult your employees. Talk to them about the specific factors that make their jobs stressful. Some things, such as failing equipment, understaffing, or a lack of supervisor feedback, may be relatively straightforward to address. Sharing information with employees can also reduce uncertainty about their jobs and futures. Communicate with your employees one-onone. Listening attentively face-to-face will make an employee feel heard and understood. This will help lower their stress and yours, even if you’re unable to change the situation. Deal with workplace conflicts in a positive way. Respect the dignity of each employee; establish a zerotolerance policy for harassment. Give workers opportunities to participate in decisions that affect their jobs. Get employee input on work rules, for example. If they’re involved in the process, they’ll be more committed. Avoid unrealistic deadlines. Make sure the workload is suitable to your employees’ abilities and resources. Clarify your expectations. Clearly define employees’ roles, responsibilities, and goals. Make sure management actions are fair and consistent with organizational values. Offer rewards and incentives. Praise work accomplishments verbally and organization-wide. Schedule potentially stressful periods followed by periods of fewer tight deadlines. Provide opportunities for social interaction among employees. Authors: Jeanne Segal, Ph.D., Melinda Smith, M.A., Lawrence Robinson, and Robert Segal, M.A. Last updated: June 2019. Reprinted with permission from HelpGuide.org. The entire article can be found at Healthguide.org/articles/stress/stress-in-theworkplace.htm.

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NATIONAL PAWNBROKERS ASSOCIATION

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business solutions

Want More Time and Money? 4 ways to use technology in your pawnshop to increase inventory turns by Tally Mack

pawnshop may not look like the ideal user of cutting-edge technology, but pawnbrokers are quickly turning to apps and sophisticated software to connect with customers, provide more convenience, and sell more inventory. Today’s business environment makes it hard to compete with big box retailers, especially when companies like Walmart spend $10,000 per month, per location, on technology. Pawnshops have a unique opportunity to connect with customers in a way that corporations don’t, and leveraging technology improves individualized service. In this article, we’ll uncover four ways for you to use technology to cater to customers’ needs, and ultimately increase inventory turns. FALL 2019

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business solutions

GO MOBILE

Mobile has quickly become an important, maybe even the most important, digital touchpoint for today’s consumer. The average American checks their phone once every twelve minutes and picks it up 80 times per day. Studies show that 84 percent of shoppers use their mobile phones while shopping. This presents pawnbrokers with an opportunity to connect with customers digitally through the use of mobile applications. With more than 50,000 downloads, MobilePawn debunks the myth that pawn customers don’t want or need mobile apps. In fact, your customers are using their mobile devices to find deals and shop recently priced inventory. Giving your customers an exclusive, companybranded application makes them feel appreciated, special, and more invested in your company. Customers who have downloaded your mobile app will be able to purchase and make layaway payments remotely. This not only enables more spontaneous purchases but eliminates unwanted trips to the pawnshop to make a $10 layaway payment. Customers with your pawnshop’s mobile application are more loyal to your brand and walk through your doors twice as frequently than those without an app downloaded, proving the mobile applications not only help drive online sales, but they also help drive in-store traffic for brick-and-mortar retailers.

LEVERAGE SOCIAL MEDIA

TEXT YOUR WAY TO A SALE

Social media is the key to building relationships with customers and showing your store’s personality will make your customers feel more personally connected to you. Customers who feel they can relate to you, your store, and your products feel more appreciated and connected to your brand, and therefore are more likely to stop by and become a customer. Selling on social media is more than a trend. Selling on sites like Pinterest, Instagram, and Facebook get your product in front of more eyes, and because users don’t have to leave these apps to make a purchase, selling through social media can boost your numbers more than selling on your website alone. The average person is exposed to 5,000 advertisements per day. To be successful in today’s environment, your pawnshop has to be one of them. Social media can keep your brand front and center, so that the next time your customer needs to buy something, you’re top of mind.

Sending text messages has become one of the most effective marketing strategies due to open rates of 98 percent and super-high conversion rates. Businesses of all sizes are capitalizing on this easy and inexpensive channel of marketing. Coca-Cola now spends 70 percent of their mobile marketing budget on SMS services. Further, sending texts has become particularly effective for reaching younger audiences, so if you’re looking to attract younger retail customers, texting may be your answer. Most pawn point-of-sale platforms have texting capabilities. From your point-of-sale, you should build customer reports so you can specifically tailor the content to the person. This results in customized messages that are more effective than a mass text. Ideas for criteria include sending texts to women in the weeks leading up to Father’s Day, men in the weeks leading up to Mother’s Day, people who are having a birthday, and people who are celebrating anniversaries. Even when a customer doesn’t immediately make a purchase, they are more likely to buy when the big occasion, like an anniversary or kid’s birthday, comes around.

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

GO WHERE YOUR CUSTOMERS ARE

In some form or another, your customers are online. A website is basically a necessity for a successful business. These days, customers love to check up on a business online before they go to check it out, whether that means checking out reviews or seeing if there are any deals and promotions. If you’re not asking customers for a review, you need to start. Investing in a good website that fits the needs of your customers will drive more traffic through your front doors and keep your business feeling approachable and personable. In addition to learning more about your store, many customers prefer online shopping. Be wary of adding online shopping carts if they don’t completely and totally integrate with your pointof-sale. The only cost-effective and profitable model for adding e-commerce to your brickand-mortar is to select an omni-channel solution, as opposed to bolt-on or multi-channel. Customers who sell on two or more omni-channel platforms, like Buya and eBay, see 121 percent more in-store retail sales than stores without. With your products on Buya, Google is serving ten impressions daily per item listed. The Google Product Listing ads are completely geolocated, and actually drive foot traffic into your store.

Pawnshops and retailers have long had a data gap, where archaic and legacy technology was limited beyond the initial purchase. Today’s pawn point-of-sales have changed that. You can now slice and dice your customer data and purchasing trends to offer special deals, promotions, and loyalty coupons via texting, emailing, push notifications, and social media pushes. The goal of every pawnshop owner is to maximize the productivity of their business. There’s a lot that goes into it, and driving efficiency is easier said than done. If you’ve put off upgrading to new technology because you don’t want to take the time to learn how to use it, or because you think it’s too expensive, you’re at a competitive disadvantage. The tools now available to pawnbrokers more than pay for themselves. Leverage the technology available to drive in-store traffic, grow your brand and digital footprint, attract new customers, and provide a customized and improved customer experience. Tally Mack is a fifth-generation pawnbroker and CEO of Bravo. Living in the tech capital of the world, San Francisco, she is passionate about technology, mobile, and change management. She helps pawnbrokers connect the dots from older generations of pawnbrokers to millennials. She’s laser focused on delivering customer service and employee satisfaction.

FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

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multi-store owner profile

Johnny Frederick, President and General Manager, Top Loan Pawn

Deep In the Heart of Texas TOP LOAN PAWN Over half of all NPA pawnbroker members are part of a multi-store operation. To get a closer look into all the decisions that are made on how, when, or if you should expand your pawn business, we are featuring a series of articles on pawnbrokers who own more than one store.

he city of Killeen, Texas, located about halfway between Dallas and Austin, was originally a small farming town that grew into a military boomtown when Fort Hood was built. As a newlywed college student, Johnny Frederick started working part-time for a pawn store in Killeen. He quickly became the manager and in 1986, opened his own pawn store with his wife and father-in-law. Five years later, they opened a second store, with a third store six years after that. He currently has two stores, both in Killeen, and employs 10 people. Johnny and his team wanted to expand the company’s market share and loan base. When existing businesses came up for sale, they acquired them. FALL 2019

“These stores were in good traffic areas, with potential for growth. We viewed this as an opportunity to expand and bring our business model to new areas,” says Johnny. Multi-store owners have many challenges. For Johnny, the biggest obstacle is finding good people with the skill set he needs. When hiring, he looks for people who are friendly, outgoing, express themselves well, and are willing to learn. “If they have these qualities, we can teach them to be a good pawnbroker. We look everywhere for new people—friends, church, word of mouth, Facebook, Craigslist.” At Top Loan Pawn, all of the training is “hands on”. Employees do many (Continued on Page 64)

NATIONAL PAWNBROKERS ASSOCIATION

2019-2020 NPA Board of Directors

NPA 2019-2020 Board of Directors

Officers

President, Kerry Rainey Bayou Pawn & Jewelry Hammond, LA

Kerry is the owner of Bayou Pawn & Jewelry, with three locations in Louisiana. He is an experienced jeweler with 34 years on the bench. Kerry is a secondgeneration pawnbroker and has three sons who work in the business with him. He is a member of the Louisiana Pawnbrokers Association and has served on the board as Vice President, President, Treasurer, and currently, Secretary. Kerry and his wife, Sharman, enjoy scuba diving and traveling with their three sons.

Vice President, Boyd Naylor Bali Credit Corp San Antonio, TX

Boyd is President and co-owner of Bali Credit Corporation which operates five stores in the San Antonio area. Prior to founding the company in 2000, he practiced law in El Paso, TX, for 15 years. Boyd is a member of the State Bar of Texas and serves on the Texas Association of Pawnbrokers Board of Directors. He serves as chair of the NPA Government Relations Committee. He is married to Alison, whose family has been in the pawn business for over 50 years. They have been married for 32 years and have three sons – Brooks, Jared, and Reagan.

Treasurer, Robert Anderson, CPA, CMA R & R Pawn Indianapolis, IN

Rob is CFO for R & R Pawn and holds professional accounting certifications in both the U.S. and Canada. He is an Indiana CPA Society award winner for Leadership in Technology and serves as chair of the NPA Finance Committee. He is also Treasurer for the Indiana Pawnbrokers Association and an Advisory Board Member for St. Elizabeth Coleman Pregnancy and Adoption Services. Rob is married with three daughters. He plays and coaches ice hockey with USA Hockey, and his team won the USA Hockey National Adult Pond Hockey Championship three years in a row (2012-2014).

Secretary, Chad Carter Chad’s Pawn Shop Lake Charles, LA

Chad is the owner of Chad’s Pawn Shop, with six locations in southwest Louisiana. He has been in the industry for 37 years and previously served as President of the Louisiana Pawnbrokers Association. Chad and his wife, Dana, have two children, Kip and Hollis.

Immediate Past President, Tim Collier Pacer, Ltd Little Rock, AR

Tim is co-owner and managing partner of Pacer, Ltd. He founded the company in 1990 after a 10-year career in retail jewelry with Gordon’s Jewelers and several independent jewelers. He is president of the Arkansas Pawnbrokers Association and past GRC chair of the NPA. Tim and his wife, Lisa, have been married for 34 years and have three sons—Walker, and twins, Garrett and Griffin.

NATIONAL PAWNBROKERS ASSOCIATION

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2019-2020 NPA Board of Directors

Board Members David Ashe La Familia Pawn and Jewelry Maitland, FL

David is president and CEO of La Familia Pawn and Jewelry. Started in 2009, the chain has multiple locations in Florida and Puerto Rico. Prior to joining La Familia, David was a partner of Puerto Ricoâ&#x20AC;&#x2122;s first and largest private equity firm. David, an avid motorcyclist, splits his time between Florida and Puerto Rico. He and Cristina, his wife of 31 years, have one daughter, Virginia, married to Ian, and two rescue dogs, P. Rita Moreno and Maia.

Beth Anundi Capital Pawn Salem, OR

Beth Anundi, alongside her husband Adam, founded, owns, and operates Capital Pawn in Salem, OR. As first-generation pawn brokers, they have raised their kids to love and work in the industry as second-generation pawnbrokers! Beth graduated from Oregon State University with a Bachelor of Arts in English and a Master of Arts in Teaching. After 16 years of teaching at the college level, she is now enjoying helping others in the pawn world. Beth currently serves on the Oregon Pawn Association Board. Adam and Beth have been married for 26 years and have three grown children.Â

Edward Bean Suffolk Jewelers, Inc. Boston, MA

Ed is president of Suffolk Jewelers, Inc., in Boston and is also a lawyer. As a thirdgeneration pawnbroker, he has been in the business for 54 years. He is a founding member of the NPA, and was elected to its first board of directors in 1988. He is also a past president and served as chairman of the Government Relations Committee. Currently, he serves as chair of the NPA Strategic Planning Committee. He and his wife, Laurie, have three children and have been married for 17 years.

Douglas Braswell Braswell & Son Pawnbrokers Little Rock, AR

Douglas is the owner of Braswell & Son Pawnbrokers with six locations in central Arkansas. He is a second-generation pawnbroker who has worked in the industry for 26 years. Douglas is a Graduate Gemologist, a Past President of the Arkansas Pawnbrokers Association and Chairman of the Arkansas Pawnbroker Licensure Commission. He and his wife, Camille, have two teenage sons.

Bill Dawson LDPM, Inc Morrisville, NC

As CEO of LDPM, Inc, Bill developed the Picasso Pawn brand consolidating 10 individually named pawn stores and seven different companies into one cohesive unit. Bill and his wife, Heidi, love to travel and a have a cat named Kiki. Bill is a graduate of East Carolina University and the GIA Diamonds and Diamond Grading program. He is also an avid Carolina Hurricanes fan. In his free time, Bill can be found either on the golf course or practicing his game.

Michael Goldstein Empire Loan Boston, MA

Michael Goldstein is the owner of Empire Loan, an eight-store pawn chain, operating in Massachusetts and Rhode Island. Originally from New York, he is a third-generation pawnbroker. Michael founded Empire Loan in 1985 and claims to be the first fully computerized pawn store in the northeast. Through the Empire Loan Charitable Foundation, founded in 2012, he and his staff have contributed over $360,000 to local non-profits. He and his wife, Allison, live in Concord, MA, with their three children.

Craig McCall DC Management Las Vegas, NV

Craig began the chain Pawn Plus/USA Pawn & Jewelry Co. in 1995 and is the past Vice President of the Oregon Pawnbrokers Association. He has spent many years on the Board of Directors of a publicly-traded bank and is a part-time instructor at the University of Nevada, Las Vegas Business School. Craig and his wife, Katie, have been married for 26 years and enjoy spending as much time as possible with their four children.

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NATIONAL PAWNBROKERS ASSOCIATION

2019-2020 NPA Board of Directors

Board Members Brian Moulton National Jewelry & Pawn Durham, NC

Brian graduated from East Carolina University with a degree in systems engineering before deciding to get into the family business. In 2010, he joined his father at National Jewelry & Pawn, a 19-store operation in North Carolina, becoming a third-generation pawnbroker. He strongly believes we can change the negative perceptions of the pawn industry one customer at a time.

Randi Nell Big Dog Pawn West Jordan, UT

As a second-generation pawnbroker, Randi worked at Big Dog Pawn in West Jordan, UT, whenever her parents would let her. After graduating from Utah State University in 2009, she went to work full-time in the family business. When not working, she loves spending her time outdoors with her boyfriend and dog either hiking or snowboarding.

Jordan Tabach-Bank The Loan Companies Beverly Hills, CA

Jordan is the owner and CEO of Beverly Loan Company in Beverly Hills, Jewelry-N-Loan in Costa Mesa, New York Loan Company in New York City, and Chicago Loan Company in Chicago. He is a member of the State Bar of California and serves as co-chair of NPA’s Government Relations Committee. He and his wife, Casey, have a son, a daughter, and a mutt named Wilbur.

Johnny Whiteside Kendale Pawn Shop Sanford, NC

Johnny and his wife, Tara, own and operate Kendale Pawn Shop in Sanford, NC. The store was opened by Tara’s father, Jimmy Johnson, in 1980, and Johnny has been running the store full time since 1986. A member of the North Carolina Pawnbroker Association for many years, he has served on the board in many capacities, including President multiple times. Johnny and Tara have been married for 33 years and have twin daughters, Rebecca and Katie, and five grandchildren.

NPA Staff Dana Meinecke

Brittany McCorkle

Executive Director

Member Services Program Coordinator

Dana@NationalPawnbrokers.org

Brittany@NationalPawnbrokers.org

Helen Moore

Amy Kehoe

Director of Meetings & Events

Administrative Assistant

Helen@NationalPawnbrokers.org

Amy@NationalPawnbrokers.org

Margie Swoyer

Director of Communications

National Pawnbrokers Association

& Marketing

PO Box 508 | Keller, TX 76244

Margie@NationalPawnbrokers.org

(817) 337-8830

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

PAWN EXPO 2019

NPA Annual Award Winners RECOGNIZING LEADERS IN THE PAWN INDUSTRY NPA held its Annual Awards Luncheon on Tuesday, July 9, 2019, at The Mirage Hotel in Las Vegas, NV, to honor members who have demonstrated superior leadership and service to the pawn industry.

CHARLES R. JONES LIFETIME ACHIEVEMENT AWARD

The NPA awarded its highest honor, the Charles R. Jones Lifetime Achievement Award, to Kerry Rainey. Kerry is the owner of Bayou Pawn & Jewelry, with three locations located in Louisiana. He is a second-generation pawnbroker and an experienced jeweler with 30 years on the bench. He has served as the chair of the NPA Pawn Expo Convention Committee, and two consecutive terms as the association’s Secretary before being elected as NPA president this year. He has been a member of the Louisiana Pawnbrokers Association for 24 years, and has served as vice president, president, and currently, treasurer. Kerry has dedicated countless hours supporting the NPA through involvement in government relations, charitable giving, mentoring, and leadership to the pawn industry. “The NPA is the most important organization in the U.S. that supports and protects the pawn industry. I am proud to be a member, president, and to have received the NPA’s highest honor, the Charles R. Jones Lifetime Achievement Award.” Kerry encourages pawnbrokers to get more involved with the NPA as a member, on a committee, or through the NPA Board of Directors. He cites the NPA as a source of education and support which has helped him grow his business. “Over the years, not only have I learned a great deal from my work with the NPA, but by being involved in the NPA government relations activities, I have helped defend our industry and my business. I will strive to protect, build, and further develop the NPA to ensure future generations of pawnbrokers

Kerry Rainey is presented with the Charles R. Jones Lifetime Achievement Award by Tim Collier.

can benefit from it, as I have.” Kerry has been married to his wife, Sharman, for 26 years and has three sons. The Charles R. Jones Lifetime Achievement Award recognizes individuals who, through their outstanding leadership and efforts, have gone above and beyond to make a significant and lasting impact on the pawn industry over the course of their career. Honorees are regarded by their peers as leaders in the industry and recognized as such, nationally.

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NATIONAL PAWNBROKERS ASSOCIATION

PAWN EXPO 2019 2019 PAWNBROKER OF THE YEAR

NPA’s 2019 Pawnbroker of the Year Award was presented to Beth Anundi of Capital Pawn in Salem, OR. Beth co-owns, operates, and manages Capital Pawn and Capital Couture with her husband, Adam Anundi. Her work emphasis is human resources, Capital Couture, and online marketing. Her favorite part of being a pawnbroker is helping others meet their needs. Adam and Beth’s son, Elliot Anundi, joined their pawnbroking team at Capital Pawn last year. Beth has been an active member of the NPA and has been a member of both the NPA Awards and Membership committees. She has attended many of the regional pawnbroker conferences and trade shows, including Pawn Expo in Las Vegas, and recently participated in the 2019 NPA Legislative Conference in Washington, D.C.

Beth Anundi accepts the NPA Pawnbroker of the Year Award Award with her husband, Adam Anundi.

2019 INDUSTRY PARTNER OF THE YEAR

San Diego-based firm, Leaderato, headed up by pawn industry educator, Yigal Adato, was the recipient of NPA’s 2019 Industry Partner of the Year award. Leaderato, which operates Pawn Leaders and The Pawn Leaders Podcast, has supported the NPA as an industry partner since 2018. Yigal, a former third-generation pawnbroker, has educated pawnbrokers on customer retention, increasing pawn loan balances, and has inspired pawnbrokers to network on a business and personal level. He is a widely respected consultant servicing pawnbrokers across the U.S. and developed the online training platform, Pawn Leaders, which offers pawnbroker and pawn operations educational courses. Yigal’s mission is to ignite, teach, and guide business owners to make more, stress less, and have more time doing what they love. He is also a mentor and public speaker in the “leadership” space.

NATIONAL PAWNBROKERS ASSOCIATION

Tim Collier presents the Industry Partner of the Year Award to Yigal Adato of Leaderato

FALL 2019

PAWN EXPO 2019 2019 YOUNG PROFESSIONAL OF THE YEAR

Nicholas Fulton of USA Pawn in Ridgeland, MS, was selected to receive the 2019 NPA Young Professional of the Year Award. Nicholas has been involved with the NPA and the Mississippi Pawnbrokers Association for several years, and he recently organized continuing education courses at The Dixie Educational Conference and Trade Show and the Mississippi Pawnbrokers Association convention. He has visited pawnshops around the country and gained tremendous insight and best practices on the pawn business model. Nicholas is a technology savvy pawnbroker and has deployed new marketing strategies for USA Pawn via Facebook, Twitter, and Instagram which target the increasingly important millennial generation. Additionally, he has launched new pawn software which updated the USA Pawn operations and direct communication to its customers. Nicholas oversees the precious metals and gemstone division at USA Pawn and has taken the lead on several internal processes around scrap and diamond melee sales to help ensure the most efficient and revenue optimizing approach.

Nicholas Fulton accepts the Young Professional of the Year Award from Tim Collier.

2019 OUTSTANDING COMMUNITY RELATIONS AWARD

NPA’s 2019 Outstanding Community Relations Award was presented to Max Pawn, Las Vegas, NV. Michael Mack accepted the award at the Annual Awards Luncheon. From pets to people, Michael tries to touch as many lives as possible in the Las Vegas community by raising money through creative philanthropic endeavors. He and Max Pawn’s extensive community relations activities are frequently covered in television, print, and online media platforms. Michael’s work to promote pawn in the Las Vegas community has provided local and national news stories with a pawn-positive message. During the government shutdown in early 2019, Michael offered furloughed federal workers interest free loans. This effort was covered in the New York Times and on television’s Inside Edition. He also participated in an event called “Open Up,” which was held to aid government workers and

Michael Mack is presented with the Outstanding Community Relations Award.

their families during the shutdown. Max Pawn is a supporter of the Make-A-Wish foundation of Southern Nevada and contributes by walking with many of his staff in the fundraiser, “WalkFor-Wishes,” as well as hosting a “Handbag of the Month” program which donates a high-end handbag every month to benefit the organization.

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NATIONAL PAWNBROKERS ASSOCIATION

PAWN EXPO 2019

WAVES OF CHANGE Pawnbrokers from the U.S. and six foreign countries gathered at The Mirage in Las Vegas, NV, July 9-11 for Pawn Expo 2019. Some of the highlights of the three-day event included:

n Captain Richard Phillips opening keynote

on Leadership in Times of Crisis n General session Lightbox Live,

by Sally Morrison n Innovations in Security Technology,

by Roberto Doering n Fake or Fabulous – Designer Jewelry,

by Edward Lewand n When and How to Use an Auction House,

by Meredith Meuwly n A Deep Dive – Lab Grown Diamonds,

by Myriam Tashey n Pawnbroker Panel: Attracting Female

Customers, by Beth Anundi, Gina Barkan, Lynden Miller n Pawnbroker Panel: Building Your Digital

Community, by Seth Gold, Lauren Kaminsky Goldman, Danielle Yanke n Pawnbroker Panel: Ask the Experts, by

David Ashe, Joshua Davis, Sam Shocket n Pawnbroker Peer Roundtable sessions on

compliance, how to lower your forfeiture rate, how to attract loans on higher value items, and how to attract top employee prospects n Trade Show with 22 new vendors

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

PAWN EXPO 2019 Pawn Expo 2019 attendees participated in education sessions, networked with old and new friends, and visited with their favorite vendors at the trade show.

FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

PAWN EXPO 2019

WAVES OF CHANGE

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

PAWN EXPO 2019

Thank You to Our Pawn Expo 2019 Sponsors

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NATIONAL PAWNBROKERS ASSOCIATION

community involvement

Bringing Dignity to the Homeless

Manager Nick Chehotsky, Chad’s Pawn Shop in Lake Charles, Louisiana, holds one of the packets prepared for the homeless.

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

f you’re down and out on your luck in southwestern Louisiana, Chad Carter, the owner of six Chad’s Pawn Shop stores, is looking out for you. Chad has always made a habit of helping others. “You just get a good feeling when you’re helping people,” he says. Last year, he felt the homeless people he saw would feel better about themselves if they had a little food in their stomach and some of the basic essentials to clean up. They might even feel good enough about themselves to go out and look for a job. He came up with the idea of handing out packets of basic necessity items to anyone he saw who looked like they could use a helping hand. The packets include things like water, mints, fruit snacks, or crackers, and personal hygiene items, such as hand sanitizer, soap, shampoo, a razor and shaving cream, and a toothbrush and toothpaste. Sometimes, they also include an inspirational quote and helpline phone numbers. Chad’s wife, Dana, and his office manager, Melissa McDaniel, assemble the items in one-gallon bags. They try to keep the cost per bag under $2 by buying in bulk whenever possible. The bags are then given to the Chad’s Pawn Shop employees to hand out to anyone who they feel needs them. Some employees have specific areas where they know the bags will be put to good use while others are given out indiscriminately. Chad keeps a few in his car because you never know when you’ll run into someone who could use a little help or just needs to know that someone cares. Kip Carter, Chad’s son, shares, “People everywhere need help. I like giving something that I know they can use. And maybe someday, they can do that for someone else.”

certified pawn professional

Pawnbrokers Earn Their CPP Designation Three NPA pawnbroker members completed the Certified Pawn Professional (CPP) program and received their CPP designation at Pawn Expo 2019 in Las Vegas last July. Graduates include: Steve Carver, AmeriPawn, Richmond, VA Sean Makovsky, Brittex Financial, San Antonio, TX Leo Rayos, CashCo Pawnshops, San Diego, CA

Steve Carver

NPA’s Certified Pawn Professional (CPP) program is now in its fifth year and continues to attract new participants. Course offerings have been administered to over 162 pawnbrokers since its inception in 2015, with 24 of them completing the requirements to receive their CPP designation.

Get More from Your CPP Designation Your CPP designation took time (and money) from your business. Get more out of your certification with these simple tips:

Spell out the words when you use them as CPP probably won’t mean much to

Sean Makovsky

most people.

Remember to add your designation to all of your online and printed materials. Be proud

of what you’ve done.

Add information on your website detailing your training and share how your increased

knowledge translates to better service for your customers.

Continue using the information you learned by reviewing the materials and your notes.

Share what you’ve learned with your staff and other pawnbrokers. Leo Rayos

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NATIONAL PAWNBROKERS ASSOCIATION

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Helping Each Other

membership

NPA’S MENTOR PROGRAM HELPING PAWNBROKERS SUCCEED

“You get to enjoy the process of teaching and sharing your knowledge, and you also learn from your mentee.” -BETH ANUNDI

times, I was actually a better teacher than student,” Frank says. “It is humbling when one teaches someone and then begins to reflect on themselves. It does not matter how long or experienced one is, they can still learn. In the mentoring process, my protégé introduced me to the world of rentto-own and I was fascinated. It felt good to know that I was helping a fellow pawnbroker possibly avoid pitfalls which I had to learn the hard way. I only wish I could have had more face time with Boris…in Aruba!” Communication between mentor and mentee is conducted primarily through email, text, and phone. A sampling of the topics discussed has included software, safes, insurance, pricing, employees, and compliance. Mentor and mentee often meet for the first time at Pawn Expo and then make future plans for a store visit. The program is a free membership benefit of NPA and both mentor and mentee must be NPA members. Beth and Adam Anundi of Capital Pawn in Salem, Oregon, have experienced the program both as mentees and later, as mentors. Their mentor was Kerry Rainey of Bayou Pawn & Jewelry in Louisiana, current president of NPA. Beth shares, “We had a great time getting to know our mentor and asking questions when we were in a pinch. He and his staff were awesome about sharing information and even invited us down to see how their operation works.” There are advantages for mentors as well, she adds. “You get to enjoy the process of teaching and sharing your knowledge, and you also learn from your mentee.” The Mentor Program Guidelines and Applications (for both mentors and mentees) can be found online in the Members Only area on the NPA website. If you have any questions, call Dana Meinecke at (817) 337-8830.

he NPA Mentor Program was developed in 2013 to help new pawnbrokers transition into the pawn industry by pairing them with seasoned veterans for a year-long educational experience. The primary goals of the program are to help new pawnbrokers adjust to the profession and help them build knowledge in a variety of areas. The mentor can often see where the pawnbroker needs to make improvements that they themselves cannot see. They can offer encouragement and support to help instill confidence in the new pawnbroker. They can also act as a sounding board for ideas the mentee has, but is unsure about. Frank Massa of Worldwide Pawn in Bristol, Indiana, served as a mentor for Boris Cybul, owner of five La Estrella Pawn Shops in Aruba. “In the mentoring process, I found myself reverting back to my beginning in the business and realized, at FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

business solutions

outside

Clutter-Free and Customer-Focused A

clean and inviting store is one of the keys to a successful operation. Your retail space needs to be productive so your salespeople can do what they do best – sell. Visual merchandising and product displays will help optimize the retail aspects of the store. But to get to that point, you first need to declutter. In general, less is more. While this may see counterintuitive at first, in reality, if your store is messy or crowded, you will drive customers away. Break your store into zones: outside, front of store, merchandise, counter, miscellaneous (rest rooms, stock rooms). Then walk through and determine what needs to be cleaned, rearranged, or decluttered. OUTSIDE

Cleanliness has a huge impact on your customers’ shopping experience, so start 48

NATIONAL PAWNBROKERS ASSOCIATION

FALL 2019

cleaning and then clean again. Begin with the outside since that’s where your customers get their first impression. Is the parking lot clean, the grass mowed and weeded, the trash picked up? Sweep away the cigarette butts and dried leaves and be sure the dumpster is out of sight. Repaint the parking space lines, if needed. Clean your sign. How is the building’s paint job? If it’s dull or faded, schedule a re-painting. Check the front door. Is it free of grime and stickers (except for your NPA member decal, of course)? Wipe down the knobs and buff to a shine. How about the windows? Are they sparkling clean? Give them a detailed wash and shine inside and out. Remove any old tape residue or unneeded stickers. Go outside and look in the window yourself. Does it entice you to go in and browse?

INSIDE

Inside the store, check the floor. Are there any cracked tiles that need to be replaced? Does it need a coat of polish or a new buff job? Take care of any ripped or fraying carpet to eliminate tripping and hose down the floor mats. As you move into the area just inside the front door, look at the floor displays. Are they clean and neatly arranged? Check above, below, and behind to be sure there’s no empty coffee cups or wrappers. Dust the light fixtures and replace any burnt out or missing bulbs. Look up at the ceiling to see if there are any water leaks, cracks, or cobwebs. Replace or clean the air filters and vents. What about the pawn counter? Clean the register and the area around it removing all post-it notes, stickers, paper clips, and other items that seem to migrate there. Disinfect all keypads, cash register keys, touchpads, scanners, and monitors. Store or remove all extraneous papers, books, binders, or manuals that take up precious space and make the area look cluttered. Wipe down all of the counters (top to bottom and side to side) with disinfectant. In the office area, sort through the contents of the desk and file cabinets purging all unneeded papers. Clean out the drawers and put like items together – paper clips, pens/pencils, markers, paper pads, etc. Wipe down the inside and outside of the desk and cabinets. Clean the floors and walls; repaint if needed. Clean the area around the computer and the mouse; replace the mouse pad, if needed. Wipe down the desk chair, especially the arms and legs. Put back only what you need on a daily basis on the top of the desk. Next is the stock room. Clean and purge the shelves. Check for any mold, mildew, or damp spots and make any needed repairs. Look over any utility carts and dollies to be sure they’re in good working order. Wipe away grease and built-up dirt. Remove all garbage and clean the floors. Replace any missing labels if your shelves are labeled. Lastly, take a close look at the rest rooms. Do the walls need repainted? Does the grout need redone? Are the doors (and the door knobs) clean? Does it have a fresh scent? Are the paper

inside

towel and toilet paper rolls in good working order? Thoroughly clean the soap dispensers, the sink, the faucets, and especially, the commode and the floor around it. DISPLAYS

Now that you have the store clean and decluttered, let’s take a look at how it’s set up. Neat, curated displays visually highlight the items for sale. Use some of the following merchandising techniques to help products sell themselves. Present your displays using inspiration found on Pinterest, Shopify, Smart Retailer, or Design Retail Online. Make sure you use all five senses when setting them up. Have good lighting and use spotlights whenever possible. Play music for your target customer – 50s FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

business solutions

displays

Images reprinted with permission from Cole Hardware

music for an older generation; top 40 tunes for a younger audience. Include items that beg to be touched – velvet or satin fabrics, a rustic wood bench, a shiny lacquered box. For example, when creating a Halloween display, look throughout the store and pull items that are orange and black. Assemble on an orange or black tablecloth with stuffed black cats. Add pumpkin-scented candles or oil diffusers. Play Halloween music or show It’s the Great Pumpkin, Charlie Brown on a nearby TV. For window displays, create a themed story. Colehardware.com has an entire photo gallery showing great window display ideas. The seasons or holidays offer the perfect scenarios – Valentine’s Day, spring, graduation, 4th of July, etc. Place your chosen elements at eye level showing things your customers will want (not just what they need). Keep the space uncrowded giving the impression of higher quality. Use spotlights to highlight the most important item. Be sure signage is professionally printed – not handwritten. Make them short and easy to read with larger fonts. They say your shop is busy, professional, and up-to-date. Change out the window displays twice a month, if possible, to keep them fresh. Studies show that most people naturally look to the left upon entering a store, but move to the right and walk counterclockwise through it. Use a wider aisle on the right to encourage shoppers in that direction. Customers are known to gravitate towards areas of your store that are clearly

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demarcated with separate flooring making the sales space so inviting that people will want to approach. Use rugs to create “islands” for various environments. Try to keep the display units similar in nature, color, and style to give a more cohesive look. Allow plenty of space between racks and displays to encourage traffic flow. Add impulse purchase items near the cash register or checkout line. Use the wall behind the register to show new or best-selling items. Update frequently by changing out smaller items. When possible, show what the items will look like in the customer’s home by adding homey touches – rugs, artwork, or flowers (yes, even in a pawn store!). Arrange items in groupings, such as a lawn mower, weed eater, and rake, or coffeemaker, coffee mugs, and a bag of coffee. It not only gives the customer additional reasons to buy, they’ll also save time by not having to search for companion items. Use mannequins when displaying clothing to give customers a point of reference. Follow the rule of three: place three items side by side instead of just one or, if displaying by height, arrange in order by short, medium, and tall. It will keep the customer’s attention longer on the display. Change up the displays on a regular basis – at least once a month or when your sales figures start to decline. Shake up the endcaps by using nontraditional shelving options. Things like barrels or items displayed on a brightly painted bicycle make great displays. IKEA (Continued on Page 56)

business solutions

5 Recent Trends in Employment Law Affecting Your Business By Felice B. Ekelman, Douglas J. Klein, and Allison M. Benz Jackson Lewis P.C.

As employment law continues to become more local, compliance with federal laws may not be necessarily enough. Employers must understand which state and local employment laws affect them.

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business solutions

Here are five important trends changing the landscape of employment law.

It is critical to know what standard applies in the jurisdictions in which you operate.

Pay Equity Legislation

States continue to pass tough pay equity legislation. For instance, Colorado recently passed what is being termed the “toughest” state pay equity law to date. Other states with rigorous pay equity laws include California and New Jersey. The differences in the standards are significant. Some jurisdictions require “equal pay for equal work,” others require equal pay for “substantially similar work,” and still others require equal pay for “comparable work.” It is critical to know what standard applies in the jurisdictions in which you operate. In addition, consider the best approach to understanding the basis for pay disparities, whether they are linked to seniority, education, or experience — all allowable reasons for disparities — or sex or some other protected characteristic — prohibited reasons for disparities. Tougher pay equity legislation means increased penalties for non-compliance. Some states allow aggrieved employees to collect several years of back pay and treble (three times) damages for violations. But there is good news, too. Some states offer employers a “mini-safe harbor” if they conduct proactive self-evaluations of their compensation practices to attempt to remedy unlawful pay disparities.

Equal Opportunity and Non-Harassment Training

In response to the #MeToo movement, some states have passed legislation requiring employers to conduct annual sexual harassment prevention training. This trend is expected to continue. Many jurisdictions require employers to conduct 52

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training for new hires and annual training for all existing employees. Employers need to know whether they are subject to mandatory training requirements, and what those requirements are (such as interactive training with an opportunity for trainees to ask questions). Even if your jurisdiction does not have a mandatory training requirement, it may soon. Of course, training managers (and all employees, if practicable) on equal opportunity and harassment prevention — not just sexual harassment, but all types — is a best practice even absent a statutory requirement. States with a mandatory training requirement include New York, California, and Connecticut.

Fair Labor Standards Act Regulations

The U.S. Department of Labor recently issued a Notice of Proposed Rulemaking to revise regulations under the federal wage and hour law, the Fair Labor Standards Act (FLSA). One of the proposed revisions is to increase the minimum salary level for an individual to be exempt from the FLSA’s overtime compensation requirement. The FLSA generally requires employers to pay non-exempt or hourly employees 1.5 times their regular rate for all hours worked over 40 in a workweek. Current regulations generally provide that employees earning at least $455 per week ($23,660 annually) and performing certain enumerated exempt duties (commonly referred to as the “duties test”) are not entitled to or exempt from overtime. Payment of a salary alone does mean an individual is exempt from the

overtime requirement. The individual also must satisfy the duties test. The proposed amendments will increase the minimum salary threshold perhaps to around $679 per week (equivalent to $35,308 annually) or more. The “duties test” likely will be unchanged, subject to the final rules. This means, to the extent an exempt employee’s weekly salary is $455, the business will need to adjust it up. Consider now how this will impact the bottom line. Remember, many states have higher minimum salary thresholds for overtime exemptions under state law. Other proposed FLSA regulation revisions include increasing the annual compensation threshold for “Highly Compensated Employees” to $147,414 per year, changing how employers determine an employee’s “regular rate” by including nondiscretionary bonuses and incentive payments to satisfy a portion of an employee’s salary for the “salary level test” for exempt status, and clarifying what other benefits (paid time off, meal breaks, and even tuition assistance) employers may use to calculate an employee’s salary level. Finally, employers should be aware that the increase in the salary threshold may lead to more employees suddenly becoming eligible for overtime compensation.

Paid Sick Leave

While such a law has not been enacted on a federal level, more states and localities are passing private sector “paid sick leave” laws, which provide employees of businesses of certain sizes with guaranteed paid time off to be used for the employee’s own illness, to tend to a family member’s illness, or even attend events like school conferences for their children. Covered reasons for taking paid sick leave vary by jurisdiction, so it is important to know the rules in the jurisdictions in which you operate. Employers also must know how such time is accrued, and

the maximum amount of paid leave an employee may earn per year. Additionally, some states allow employees to “cash out” unused sick time at the end of the year or carry over unused time. If your business already provides paid time off, your existing policy may comply with the paid time leave requirement in your jurisdiction, as long as your policy is as least as generous as the statutory requirement, and otherwise complies with the law. California and Washington have both statewide and local laws in some of their municipalities with which employers must comply. However, other states, like New York, Pennsylvania, and Texas, do not have a statewide law, but employers in certain localities in the state must contend with local paid sick leave laws.

Covered reasons for taking paid sick leave vary by jurisdiction, so it is important to know the rules in the jurisdictions in which you operate.

Regulations that Affect the Hiring Process

Fair employment laws generally protect not only current employees, but also prospective employees. Over the past several years, state (Continued on Page 63)

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business solutions â&#x20AC;&#x153;Brand recognition guarantees that your consumers can identify your company and its products or services immediately when they spot your logo.â&#x20AC;?

Reach potential customers with cost-effective promotional products by Scott Marshall

or years, promotional products have been a proven way to promote small business customer growth as a low-cost marketing method. Some useful gifts and/or promotional products to consider that will continue to engage your customer for months to come are: pens, water bottles, calendars, lip balms, mouse pads, umbrellas, and branded bags, just to name a few.

Sageworld.com listed some valuable stats around the use of promotional products: n In the U.S., 8 out of 10 consumers have one to 10 promotional products. n Six out of 10 such consumers keep promotional products with them for up to two years. n 85% of people do repeat business with the advertiser after receiving a promotional item. n 31% of the U.S consumers own a promotional bag. n 89% of consumers can recall the advertiser even two years after receiving a promotional product. n 63% of consumers give away their promotional products when not needed.

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Promotional Products at Work

EFFECTIVE LOW-COST MARKETING

Many small- to medium-size companies struggle with or don’t have the resources to undertake an overwhelming advertising campaign of a large scale. But they can still achieve their marketing goals with a low-cost promotional products campaign. There are many low-cost promotional items for businesses. According to Sageworld.com, drinkware provides an effective advertising platform as 57% of people were able to recall the advertiser on a ceramic coffee or custom travel mug. These products deliver a great value for your investment.

BRAND RECOGNITION

Brand recognition guarantees that your consumers can identify your company and its products or services immediately when they spot your logo. Begin the process by outfitting your staff with branded work attire as they are your front-line marketing team. Your branded promotional items further connect your customer to their positive shopping experience.

BUSINESS EXPOSURE

Conventional means of advertising such as print ads, signage, and coupons pass quickly through the consumers hands. But statistics show promotional gift items remain in use or in sight much longer. For example, your customer uses your branded umbrella on rainy days, they use your branded canvas tote when shopping, or they will drink from your branded water bottle or coffee mug. Such freebies are an excellent way for increasing your business exposure on daily basis.

CHOOSING THE RIGHT PRODUCTS FOR YOUR AUDIENCE

Consider promotional product gifts that are functional, reusable, and that build positive brand awareness. Make sure that your promotional merchandise is of high-quality that won’t end up at the bottom of a landfill. The gift items should be innovative, well planned, and aligned with your business. People will associate premium quality of the gift items with your quality of business. This will help a lot in keeping the first-time buyers of your products forever. A cleverly thought out promotional campaign using giveaway items should complement your other forms of marketing. This way, your marketing campaign will create a greater impact on the target audience and will help raise your brand’s profile and most importantly drive new and returning business. Scott Marshall is the sales manager for Apperson, Inc. Print & Marketing Solutions group with 35 years’ experience in commercial printing. Apperson is a diverse company founded in 1955 specializing in print, mail, packaging and promotional marketing as well as educational testing and assessment solutions. For more information, contact Scott at (800) 473-6761, ext. 1045 or scott.marshall@apperson.com.

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NATIONAL PAWNBROKERS ASSOCIATION

business solutions References:

(From Page50)

Clutter-Free and Customer-Focused

offers a variety of display solutions that can be adapted for your business needs at a fraction of the price. TO ENLARGE YOUR SPACE

If your retail space is on the smaller side, there are a couple of design techniques that will help it look larger. One is to paint an accent wall in a bold color. It creates the illusion of receding in space. Another idea is to create a window-like effect. Hang drapes around tall, skinny mirrors to mimic the effect of a window. Make sure your items are not crowded too closely together and use open shelving. They create an airy feel and can be flexible as well allowing you to easily change the layout. You can also make the room seem larger by painting the back wall and the floor the same color. If you have low ceilings, paint the store’s side and rear walls a bright color reducing the depth and width in favor of height. If your ceilings are really high, a horizontal “stripe” achieved with shelving or slat boards will reduce the depth making the ceiling appear lower.

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Dizon, A. (2018, January 31). Top 15 Retail Store Design Ideas from the Pros. Retrieved from https:// fitsmallbusiness.com/retail-store-design-ideas/ Porter, J. (2019, May 9). 7 Low-Cost Design Ideas for Small Retail Spaces. Retrieved from https://www. entrepreneur.com/article/224308 Buscarino, T. (2017, April 20). Ultimate Retain Spring Cleaning Checklist. Retrieved from https://www. precisiontools.com/blog/ultimate-retail-spring-cleaningchecklist/ Subastral Inc. (2018, July 23). Reasons Your Displays Are Hurting Sales. Retrieved from https://subastralinc.com/ blog/reasons-your-retail-displays-are-hurting-sales/ Porter, J. (2012, June 25). Tips for Creating a Window Display That Will Draw in New Customers. Retrieved from https://www.entrepreneur.com/article/223677 Nugent, P. (2014, September 23). 10 Store Design Ideas that Save Money and Boost Sales. Retrieved from https://www.shopkeep.com/blog/10-steps-to-a-betterlooking-retail-store-on-a-shoestring#step-1 Peacock, L. (2019, March 4). Visual Merchandising 101: Shore Up Sales With High-Converting Product Displays. Retrieved from https://www.shopify.com/blog/visualmerchandising

compliance corner

Your Compliance Questions Answered Do you have a compliance question you need answered? Not sure when or how to file an 8300 or SAR? Want to know how to conduct enhanced due diligence? Need to know the requirements for an AML program? Getting audited by the IRS on a compliance audit? Ask your questions from The Compliance Guy! Send any anti-money laundering related compliance question to Margie@ nationalpawnbrokers.org, c/o The Compliance Guy.

Bob Frimet is a certified anti money laundering specialist who has served the pawnbroker and dealers in precious metals industries since 2006 conducting independent reviews, drafting policies and procedures, and providing assistance with state and federal audits. He can be reached at (702) 596-8370, bob@ checkconsultants.com, or by visiting Checkconsultants.com.

Dear Compliance Guy, I own a small shop in the heartland. I purchase about $1,500 per week in scrap. never file 8300s because of the low dollar amounts. So, I don’t have to comply with the Dealers in Precious Metals rules, right? Steve

Dear Steve, I get that question often. Unfortunately, if you purchase more than $50,000 in the previous calendar year and sell at least that amount (to a refiner, dealer, etc,), and it’s an aggregate of 50% pure (12K), then for all intents and purposes, you are a Dealer in Precious Metals. Filing one 8300 or 1000 is not the trigger. Whether you are a big or small business, there is still the capability for you to conduct business with someone who may be laundering money. So, big or small, 8300 or no 8300, if you meet the trigger, you’re a Dealer in Precious Metals and you must comply. That means having an AML written program in place, training, and internal monitoring, as well as written risk assessments and independent reviews. The Compliance Guy

Dear Compliance Guy, How do I tell if something is suspicious? Tammy Dear Tammy, Filing a Suspicious Activity Report (SAR) is based on subjective circumstances. What is suspicious to you? The only real way to determine that (barring clear suspicious activity, like structuring) is to conduct EDD (enhanced due diligence.) Ask the questions that will allow you to determine if the activity is suspicious or not so you can determine your next steps, like filing a SAR. Large amounts of purchases? Ask the questions…What are the origin of funds? Why are you buying $5,000 a week in gold eagles when you work at McDonald’s and make minimum wage? There is an answer for everything, and if it makes sense and you can support the activity, no SAR is required. The Compliance Guy

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business solutions

Cybersecurity and the Security Six Internal Revenue Service Partnership & Education From the Tax Outreach, Partnership & Education function of the IRS, following are the “Security Six,” the must-have areas to secure data on computers. Whether a large firm or a one-person shop, businesses must enact security safeguards. These steps are a good idea for any taxpayer or small business.

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Antivirus software

Although details may vary between packages, anti-virus software scans files or computer’s memory for certain patterns that may indicate the presence of malicious software (i.e., malware). Anti-virus software (sometimes more broadly referred to as anti-malware software) looks for patterns based on the signatures or definitions of known malware. Anti-virus vendors find new and updated malware daily, so it is important that users have the latest updates installed on their computer, according to the U.S. Computer Emergency Readiness Team (USCERT), a division of the Department of Homeland Security. Once users have installed an antivirus package, they should scan their entire computer periodically: AUTOMATIC SCANS Most anti-virus software can be configured to automatically scan specific files or directories in real time and prompt users at set intervals to perform complete scans. MANUAL SCANS If the anti-virus software does not automatically scan new files, users should manually scan files and media received from an outside source before opening them. This process includes: n Saving and scanning email attachments or web downloads rather than opening them directly from the source. n Scanning

portable media, including CDs and DVDs, for malware before opening files. Sometimes the software will produce a dialog box with an alert FALL 2019

that it has found malware and ask whether users want it to “clean” the file (to remove the malware). In other cases, the software may attempt to remove the malware without asking first. When selecting an anti-virus package, learn about its features so you know what to expect. Keep security software set to automatically receive the latest updates so that it is always current. A reminder about spyware: Strong security software should protect against spyware. But remember, never click links within pop-up windows. Never download “free” software from a pop-up. Never follow email links that offer antispyware software. The links and popups may be installing the spyware they claim to be eliminating. A reminder about phishing: A strong security package also should contain anti-phishing capabilities, but an email provider and browser provider also should include anti-phishing protections. Never open an email from a suspicious source, click on a link in a suspicious email, or open an attachment – or else you could be a victim of a phishing attack.

Firewalls

Firewalls provide protection against outside attackers by shielding your computer or network from malicious or unnecessary network traffic and preventing malicious software from accessing the network. Firewalls can be configured to block data from certain locations or applications while allowing relevant and necessary data through, according to US-CERT. Firewalls may be broadly categorized as hardware or software. While both have their advantages and disadvantages, the decision to use a firewall is far more important than deciding which type you use.

NATIONAL PAWNBROKERS ASSOCIATION

business solutions HARDWARE Typically called network firewalls, these external devices are positioned between a computer and the internet (or other network connection). Many vendors and some internet service providers (ISPs) offer integrated small office / home office (SOHO) routers that also include firewall features. Hardware-based firewalls are particularly useful for protecting multiple computers and control the network activity that attempts to pass through them. The advantage of hardware-based firewalls is that they are separate devices running their own operating systems, so they provide an additional line of defense against attacks when compared to system or hostlevel protections. SOFTWARE Most operating systems include a built-in firewall feature that should be enabled for added protection, even if using an external firewall. Firewall software can also be obtained as separate software from a local computer store, software vendor, or ISP. If downloading firewall software from the internet, make sure it is from a reputable source (i.e., an established software vendor or service provider) and offered via a secure site. While properly configured firewalls may be effective at blocking some attacks, don’t be lulled into a false sense of security. Firewalls do not guarantee that a computer will not be attacked. Firewalls primarily help protect against malicious traffic, not against malicious programs (malware), and may not protect the 60

they also would have a user’s mobile phone to receive a security code and complete the process.

Visit www.IRS.gov for answers to questions and the most up to date IRS information. If you would like, connect with IRS via social media at: n Facebook.com/IRS n Twitter.com/irsnews n Instagram.com/irsnews n Irs.gov/socialmedia

device if the user accidentally installs malware. However, using a firewall in conjunction with other protective measures, such as anti-virus software and safe computing practices, will strengthen resistance to attacks. The Security Summit reminds tax pros that anti-virus software and firewalls cannot protect data if computer users fall for email phishing scams and divulge sensitive data, such as usernames and passwords. The user, not the software, is the first-line of defense in protecting taxpayer data.

Two-factor authentication

Many email providers now offer customers two-factor authentication protections to access email accounts. Two-factor authentication helps by adding an extra layer of protection. Often two-factor authentication means the returning user must enter credentials (username and password) plus another step such as entering a security code sent via text to a mobile phone. The idea is that a thief may be able to steal the username and password, but it’s highly unlikely

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Backup software/ services

Drive encryption

Data security plan

Critical files on computers should routinely be backed up to external sources. This means a copy of the file is made and stored either online as part of a cloud storage service or similar product. Or, a copy of the file is made to an external disk, such as an external hard drive that now comes with multiple terabytes of storage capacity.

Given the sensitive client data maintained on computers, users should consider drive encryption software for full-disk encryption. Drive encryption, or disk encryption, transforms data on the computer into unreadable files for the unauthorized person accessing the computer. Drive encryption may come as a standalone security software product. It may also include encryption for removable media, such as a thumb drive and its data.

The IRS Security Summit also reminds professionals of several other important steps. Professionals can get help with security recommendations and creating a data security plan by reviewing the recently revised IRS Publication 4557, Safeguarding Taxpayer Data & Small Business Information Security: the Fundamentals by U.S. Department of Commerce, National Institute of Standards and Technology.

business solutions (From Page 22)

17 Firearms “Must Do’s” to Create Success for Pawnbrokers

you run a legitimate, lawful, and compliant gun business.

adding firearms to your pawn business, what do you need to know? First, the federal Gun Control Act (GCA) requires that persons who are engaged in the business of dealing in firearms be licensed by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Federal Firearms Licensees (FFL) are critical partners in promoting public safety because they help keep firearms out of the hands of prohibited persons by running background checks on potential firearms purchasers or customers redeeming their pawned firearm. A “Type 02” FFL allows pawnbrokers to deal in firearms. The original application cost for a threeyear license is $200 and renews every three years for $90. Your specific state may also have additional statutes that apply to your firearms business. As a general rule, you will need a license if you repetitively buy and sell firearms with the principal motive of making a profit. Next, there is a need for intense and accurate record keeping for anyone involved in the business of buying and selling firearms. This is an “all in” area to dive into if you are considering becoming an FFL. Bad record keeping can lead to many legal and business-risk scenarios. Then there are rules! The ATF issues the regulations and compliance requirements to all approved new firearms dealers, but the learning curve can be steep and a bit challenging. Getting a good start is critical. There are websites, training resources, and the National Shooting Sports Foundation, the firearms trade association, that all provide support and guidance to help

RECORD KEEPING, RECORD KEEPING, AND MORE RECORD KEEPING! The ATF, and some states, require you to keep accurate “Acquisition & Disposition” records of your gun sales. You will need to conduct background checks on customers who want to purchase and redeem pawned firearms. The background checking process may differ depending on your state. And you may also need to apply for or amend business and zoning permits. Other important areas to consider include any impact guns may have on your taxes, your insurance coverage, and whether or not your credit card processor and bank are “firearms friendly”. Getting approved for payment processing as a firearms dealer may pose a challenge, as most banks will consider you a risky business in need of a high-risk merchant account. However, there are numerous POS software system providers that are well suited for the pawn industry and can help, if necessary, with tailored payment and record-keeping solutions.

John Bocker is an NSSF Security and Compliance Team member and the co-founder at FFL Consultants Team Member. FFL Consultants is a smallbusiness consulting agency specializing in commercial security and ATF - FFL compliance. The goal at FFL Consultants is to educate the firearms industry and protect FFLs against unexpected losses resulting from burglary, robbery, and internal control failures. Have a question regarding this article or the National Shooting Sports Foundation membership? Contact John at (720) 336-0028 and visit www. FFLConsultants.com.

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books

Books About Pawn The pawn industry offers an interesting background for great stories. Below are four books of fiction that center around the world of pawn.

Peril at the Pawn Shop

Bluff City Pawn

Baby Jesus Pawn Shop

by Stephen Schottenfeld

The Pawnbroker: A Novel

by Mel Faye This light-hearted mystery

Huddy Marr has a pawn

by Edward Lewis Wallant

Based in the Philippines,

includes an amateur

store just on the edge of

Baby Jesus Pawn Shop is

detective, a pug named

bad in Memphis and wants

The Pawnbroker: A

Ralph, a town full of goofy

to move to a nicer part

characters, and a story line

of town. He thinks he’s

that will keep you turning

found a way when he, his

the page until the very end.

brother Joe, and younger

Annie Hudson has a dog

brother Harlan, enter into

business and is trying to

a deal to buy a valuable

open her own dog store. But

gun collection from an old

her plans change when she

customer. Huddy is planning

finds out Charles Appleby,

a quick, law-abiding

the local pawn store owner,

transaction, but he knows

has committed suicide. But

his family.

Novel is a haunting story shedding light on some of the darkest moments of human behavior. In 1960s New York, Sol Nazerman, a Holocaust survivor, runs a pawn store in Harlem. Alone and depressed, he is plagued with memories of what happened to his family during the war. The story captures the mournful

was it suicide or murder?

dream of a traumatized victim as he tries to move beyond his survivor’s guilt. Nominated for the National Book Award

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by Lucia Orth

the story of two people on either side of the Philippines’ conflict under Ferdinand Marcos brutal regime. Rue is the wife of an American living a privileged life. Domingo is a Filipino dissident working undercover as her chauffeur. Theirs is a story of how to lead a moral life when everything around them is not.

business solutions (From Page 53)

5 Recent Trends in Employment Law Affecting Your Business

and local laws have limited what employers can inquire into during the hiring process. At least 23 states or localities have adopted some form of “Ban the Box” laws in recent years addressing the types of questions and inquiries employers can make of prospective employees. Criminal history is one of the most common statuses protected by these laws, and many jurisdictions are extending protections for prospective employees to issues like salary history and unemployment status. Some jurisdictions have “Ban the Box” laws that cover all private employers. Other jurisdictions’ legislation affects only employers with at least a certain number of employees. It is important to know what your

business can and cannot ask prospective employees, verbally or in writing, to avoid the legal traps. Employers must keep up-to-date about new laws and regulations that affect their business. The cost of not doing so can be significant. Consult with a Human Resources professional or employment counsel to ensure compliance.

©2019 Jackson Lewis P.C. This material is provided for informational purposes only. It is not intended to constitute legal advice nor does it create a client-lawyer relationship between Jackson Lewis and any recipient. Recipients should consult with counsel before taking any actions based on the information contained within this material. This material may be considered attorney advertising in some jurisdictions. Prior results do not guarantee a similar outcome.

Reproduction of this material in whole or in part is prohibited without the express prior written consent of Jackson Lewis P.C., a law firm with more than 900 attorneys in major cities nationwide serving clients across a wide range of practices and industries. Having built its reputation on providing premier workplace law representation to management, the firm has grown to include leading practices in the areas of government relations, healthcare and sports law. For more information, visit https:// www.jacksonlewis.com.

NO CRIME, NO FINE Money laundering and the criminals who utilize it are becoming more and more sophisticated. Don’t get caught in one of their illegal schemes! Make sure you’re following all of the rules and regulations mandated by the federal government for your business. NPA’s AML for Pawnbrokers and Dealers in Precious Metals compliance program teaches you all you need to know to stay on the right side of the law. And the course can be taken on your own time at your own computer – no classrooms, no traveling.

NPA Member

$29.95

Non-Member

$39.95

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multi-store owner profile (From Page 33)

Deep In the Heart of Texas

practice loans, sales, and redeems before they start helping customers under supervision. “We currently have a great team we work with. Our employees are like family to us. We celebrate successes, console each other during difficult times, and support each other in attaining goals.” The other challenge Johnny faces with owning multiple stores is time management and delegating responsibility. “You can only split your time so many ways before you become ineffective.” As with any business, getting the word out about what you have to offer is a priority. Top Loan Pawn has used many marketing tools over the years. “We now use television and

community involvement. We just started a new digital campaign with Facebook and Google that I am very excited about.” Their motto is ‘Your Helpful and Friendly Pawnshop’ and they know their customers. “They become our friends and we treat them as such. They are not just a line on the balance sheet.” If you’re thinking of expanding your business, Johnny’s advice is, “Do your homework and hire a quality staff.” For capital, he feels when you do the homework up front, the risk is reduced to a manageable level. As a pawnbroker, Johnny is very happy with what he and his team have accomplished over the last 33 years. “It’s been a great learning adventure.”

“We currently have a great team we work with. Our employees are like family to us. We celebrate successes, console each other during difficult times, and support each other in attaining goals.” -JOHNNY FREDERICK

Get on Board PAWN EXPO 2020 June 23-25, 2020 Paris Hotel Las Vegas 64

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member news

NPA New Members MAY 1, 2019 – JULY 31, 2019 PAWNBROKERS AZ Bancless • Phoenix CA Granter’s Jewelry & Loan Co • El Cerrito CO Big J Jewelry and Loan • Grand Junction FL Cody’s Pawn & Jewelry LLC • Sarasota Wild Side Pawn and Gun • Stuart La Familia Pawn & Jewelry • Haines City LA Pelican Pawn & Jewelry • Baton Rouge MN Saver’s Pawn • Saint Francis Uptown Pawn • Minneapolis NJ Muthoot Finance USA Inc • Iselin OK Extra Cash Gold & Loan • Oklahoma City Extra Cash Pawn • Oklahoma City OR World Pawn Exchange • North Bend A1 Hawk • Portland (2) A1 Hawk • Gladstone The Gold Exchange & Pawn Inc • Klamath Falls PA Accurate Gold • Philadelphia Cheltenham Pawn Shop LLC • Wyncote TN Music City Pawn • Franklin (2) Music City Pawn • Nashville (2) Music City Pawn • Hermitage PawnWay of Springfield • Springfield TX Texas Dollar Pawn • Wylie Top Gun Pawn • Spring UT World Class Pawn & Jewelry • Cedar City

INTERNATIONAL Canada Greenbacks Pawn Shop • Belleville, ON First Stop Swap Shop • Peterborough, ON Xchange Zone • La Prairie, QC (2) Xchange Zone • Trois-Rivieres, QC Xchange Zone • Virmont, QC Xchange Zone • Longueuil, QC

INDUSTRY PARTNERS Devoted Pawn Consulting • Tampa, FL Jackson Lewis PC • New York, NY SGL International Inc • New York, NY

state news

State Association Updates KANSAS Robin Tummons, President Kansas Pawnbrokers Association hsofstuartltd@yahoo.com

On May 16, 2019, Kansas governor Laura Kelly signed into law House Bill 2140. As of July 1, 2019, Kansas will have a sales tax exemption on sales of gold and silver coins and on all gold, silver, platinum, and palladium bullion. Although currency, cents, nickels, and numismatic coins of nonprecious metal are not included, we feel this is a good start in the right direction. Kansas will now join 38 other states with a sales tax exemption. I would like to thank all those who spent their time traveling to the capital to speak before the House and Senate Committees and submitted testimonials. Those who took time from their busy schedules to meet with politicians on both sides made an impact as educating is imperative for this process to be successful. Also, a big thank you for all who pitched in to financially support our lobbyist throughout this long process. Many voices are heard so much better than a select few! This will help level the playing field for all in a state that has been completely surrounded by tax exempted states. MISSISSIPPI Nick Fulton, President Mississippi Pawnbrokers Association nick@USAPawn.com

The Mississippi Pawnbrokers Association has set the location and date for its continuing education program. The date is November 2, 2019, with registration beginning at 8:00 am and a start time of 9:00 am. It will be in a new location this year in downtown Jackson at the Marriott Hotel. Our keynote speaker will be Jerry Whitehead of Pawnshop Consulting Group. If you haven’t gotten your continuing education hours for 2019, this will be your last opportunity of the year. Anyone needing to reserve a room at the Jackson Marriott can call (601) 969-5100. Our rate is $99/night, so be sure to tell them it is for the Mississippi Pawnbrokers. You will need to reserve your room by October 1, 2019. FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

pawnder this

Window Stickers By Rudy J. Klancnik

5K. 10K. 13K. 26.2. 0.0. If you’ve been driving around town over the past 24 hours, there’s a good chance you’ve seen these numbers in front of you, next to you, and even in your blind spot. They’re window stickers, of course, and these particular stickers are bragging their tails off about running various distances. That’s just the self-immersed world we live in. The bumper sticker used to have a special place in the heart of American activism. And a special place on the actual bumper. But that was back in the ‘70s and ‘80s when endless gas lines, Watergate, civil rights, feminism, and big brother were rocking our worlds. The baby boomers used bumper stickers to express their feelings on serious issues, oftentimes giving the literal bird to The Man at every left turn. 66

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And then a funny thing happened as baby boomers started getting gray hair. They chilled the heck out during the Clinton administration, even through Lewinsky Gate, and the bumper sticker went the way of the 8-track tape and TV Guide. Of course, something else disappeared—the actual bumper. Bumpers on today’s cars blend in so well that you can’t tell where the car stops and the bumper begins. That brings us up to the back window where the window sticker has replaced the bumper in every way with one important exception...people aren’t so much using stickers to voice their opinions on pressing issues as they are simply bragging non-stop about themselves. In the Facebook culture, window stickers are a way to show off when we’re not on our computers. Take, for instance, a recent drive around town. At

the first stop light, two stickers bragging about how far they once ran in a race. Check. Another window sticker bragging about how many assault-style rifles he owns. And another touting their family as Star Wars characters – stormtroopers to be exact. Yes, Star Wars characters. The movie that’s spawned billions of dollars in toy sales, Star Wars is the unofficial champ of window sticker families with stick-figure families a very close second. There certainly are awesomely funny stickers, such as “My son beat up your honor student,” but in the age of anti-bullying, I’m sure someone somewhere is being subpoenaed over that one. There are dinosaurs devouring the stick-figure family, a van with letters cut out of a newspaper that reads “I took your stick-figure family”, and a stick-figure family with the mom missing that reads “Taking applications.” I’m assuming that’s driven by a divorce lawyer since it’s on the back of a black Mercedes. “My daughter and my money go to Texas Tech,” which hits particularly close to home, is a bit cliché as are any spotlighting their kids making their elementary school honor roll. Look, it’s cool to be proud of little Susie for making the A-B honor roll, but elementary school honor roll is as impressive as winning at tether ball.

Then there are the youth sports window stickers. This just might be the biggest category of them all, bigger even than Star Wars and stick figures. Or even Star Wars stick figures. Youth sports window stickers come in all shapes and sizes, but if you needed a barometer for what parents care about, it’s their youth sports kid. n “Jayden 35” with his team’s logo that clearly was designed by someone who loves lightning bolts n “Madison 10” with her soccer club’s very professionallooking logo - as if 7-year-old Madison is actually going to play past junior high after she burns out on her sixpractice-a-week lifestyle n “Fisher 24” on one side and “Hunter 23” on the other. I guess Hunter won the fight with his brother for MJ’s jersey number and their dad won the battle to name his kids after his hobbies. But there’s good news for people like me who are tired of the ego-driven moving billboards. We’re officially seeing a return to angry, motivated, and educated young people. Everything from climate change, gun control, and the President’s latest twitter storm, there are countless issues to shout about. And no better place to scream at the top of your lungs than on your back window.

book corner

Measure What Matters by John Doerr

WHETHER YOU’RE A SEASONED CEO or new to the business world, you’ll find the lessons and tools in Measure What Matters to be extremely valuable. Author John Doerr shares Intel manager Andy Grove’s goal-setting system of objectives and key results (OKRs), a proven method of operating excellence. OKRs have helped tech giants from Intel to Google achieve extreme growth with increased productivity and innovation. When faithfully practiced, the system has worked for over 50 companies. The objectives are what you’re trying to do; the key results are how those goals will be attained with specific and measurable actions in a set time frame. With case studies demonstrating how the system works, the book shows how you can achieve the same type of explosive growth. FALL 2019

NATIONAL PAWNBROKERS ASSOCIATION

calendar of events SEPTEMBER 2019

CALIFORNIA PAWNBROKERS ASSOCIATION ANNUAL CONFERENCE September 27-29, 2019 Renaissance Long Beach Hotel Long Beach, CA Contact Kim Andosca: KAndosca@amgroup.us

FEBRUARY 2020

TEXAS ASSOCIATION OF PAWNBROKERS CONVENTION February 28-March 1, 2020 Embassy Suites by Hilton Houston Energy Corridor Houston, TX Contact Tammi Springett: Texasap25@gmail.com Texasassociationofpawnbrokers.com

MARCH 2020

DIXIE CONFERENCE AND TRADE SHOW March 27-29, 2020 Perdido Beach Resort Orange Beach, AL Contact Nick Fulton: Nickfulton@comcast.net Dixieconvention.com

index of advertisers 3 CLiCk Media

(847) 298-0010

3clickmedia.com

Midstatesrecycling.com

Aarav Diamond Inc

NPA LEGISLATIVE CONFERENCE April 20-21, 2020 Embassy Suites Hotel Crystal City â&#x20AC;&#x201C; National Airport | Arlington, VA Contact Dana Meinecke: Dana@NationalPawnbrokers.org

JUNE 2020

PAWN EXPO 2020 June 23-25, 2020 Paris Las Vegas | Las Vegas, NV Contact Helen Moore: Pawnexpo@NationalPawnbrokers.org NationalPawnbrokers.org

Midsouth PM

(212) 944-1553

(800) 895-1874

Aaravdiamondinc.com

Midsouthpm.com

AML Compliance Training

Padmavati Exports, Inc

(212) 869-0544

Bluestone Trading Company Inc

Back Cover

Padmavatiexportsinc.com

(888) 800-BLUE (2583)

Pawn Expo 2020

Bluestone-trading.com

NationalPawnbrokers.org

Bravo Pawn Systems

(888) 407-6287

Pawn Summit

PawnSummit.com

Bravopawnsystems.com

Pawnbroker Financing

Data Age Business Systems/

(303) 373-1300

PawnMaster

Pawnbrokerfinancing.com

Inside Front Cover

(888) 949-7296

Podium 11

Pawnmaster.com

(833) 276-3486 Flex Payment Solutions

(636) 533-0140

Podium.com Rapaport Auctions

Flexpaymentsolutions.com

(212) 354-9800 Garrett Metal Detectors

(800) 527-4011

APRIL 2020

Mid-States Recycling & Refining

(212) 365-0691

Rapaportauctions.com Stuller, Inc

Garrett.com

(800) 877-7777 Geib Refining

(800) 228-4653

Stuller.com

Geibrefining.com

United Precious Metal

Gemological Institute of America 28

(800) 999-FINE (3463)

(800) 421-7250

Unitedpmr.com

Refining, Inc.

Gia.edu

Wexler Insurance

Jewelers Mutual Insurance

Agency

Inside Back Cover

(800) 558-6411

(800) 432-1853

Jewelersmutual.com

Wexlerinsurance.com

The NPA does not specifically endorse any entity including but not limited to exhibitors and advertisers; makes no representations, warranties, or guarantees; and assumes no responsibility for the products or services provided by these entities. The NPA expressly disclaims all liability for damages of any kind arising from the use or the performance of the products or services provided by these entities.

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WEXLER INSURANCE AGENCY, INC.

Included coverages such as: FedEx Shipping; Workplace Violence; EPLI & Cyber Liability

PAWNBROKERS

INSURING

SINCE 1968

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1120 Ponce de Leon Blvd. Coral Gables, FL 33134 Tel: 305-445-5050 Fax: 305-448-8189

Ask about our exclusive Workers Comp program for Pawnshops!

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Products Liability for Guns & Ammunition

Wexler Insurance Agency, Inc.

Business Interruption

Replacement Cost 2 or 3 times pawn value

New York OfƂEG 580 Fifth Avenue Suite 715A New York, NY 10036 Tel: 212-391-5211 Fax: 212-391-5212

Ohio OfƂEG 7363 E. Kemper Rd. Suite C & D Cincinnati, OH 45249 Tel: 513-891-2131 Fax: 513-891-2132

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CALL 1-800-432-1853 FOR AN IMMEDIATE QUOTE OR VISIT US AT WWW.WEXLERINSURANCE.COM

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