We don’t see too many new vendors throwing their hats in the ring to service the pawn broking industry. Why is that? It seems lucrative, right? Pretty straight forward? The loan payment calculations seem easy enough… It’s quite the contrary. As far as software goes, this is a very niche or vertical market. That is to say that this market is very finite in the number of possible customers and very specialized in terms of operation and calculations. Not only that, there are also specific requirements state by state when it comes to regulatory mandates, controlling the rates that are charged and how they are calculated over a period of time. In the nearly 30 years that I have catered to this industry, I’ve seen over a dozen decent sized software vendors come in with high hopes only to fade away—some slowly, years later, and some abruptly. With every new vendor I met while attending any state, regional or national trade show, I always made sure that I sincerely extended my handshake and wished them good luck in their new endeavor. I always followed my well wishes with, “It’s not easy.”
As I reflect back, it was easy enough in the 80’s and 90’s with an old DOS-based systems that merely did the basics for the broker; print tickets, accept payments, keep track of customers, and take care of the point-of-sale and inventory for shops in Florida. When developing PawnMaster, we built a solid and stable base and after a few years we moved on to neighboring states. This took a lot of patience, a lot of development, and a lot of capital, with very little return for many years (I can only hope this begins to illustrate our dedication to the industry). And just when you thought that you were in the clear, you found that new technology was knocking at your door. Many vendors never invested in the future of a Windows platform and have all but faded away. I’m quite sure most vendors never anticipated the spend it would take to keep up with technology.
Something I noticed early on that really hurt the vendors in this industry was a serious underestimation of the development necessary to comply state to state. If the software foundation was not built to support these changes during integration, well, bad things started happening. Then comes that all too familiar phrase, “Buyer Beware.” Along the same lines, many vendors underestimated the small business owner’s concept and vision when it came to running and operating their business, their way. If every pawn shop out there has their own unique twist to running their shop, we in the industry should embrace this. I will admit, speed to market and sales volume seem to be the logical answer when it comes to making money in the software business, but I must say; in this niche market, that would be short-sighted and a mistake which ultimately hurts both the customer and the vendor.
A lot goes into the development of software for the dynamic pawn industry. You have to take your time, do things right, and cover all the finer details in the broker’s business. If you do these things well, while accepting input (and even criticism) from your user base, good things come to all involved.