>The reason the market value is not that high is mostly because the few big names gobble up all the instruments they can to reduce the size of the secondary market so they can sell their instruments at the highest price they'll fetch.
Is that really a thing? Seems like a great way to lose money.
Not if you are refurbishing them, and then reselling them as "certified used" for a profit. Then you have captured more of the secondary market while still helping to maintain your new prices.
It's like how brand names manufacture "competing" store brand products right next to their brand name stuff.
Dunno about at the start of the endeavor, but if they manage to buy out the whole after-market such that they can build the expectation that no real market exists, then both buyers and sellers will not even attempt to sell/buy at “true” prices, and instead look directly at “certified” and new models only. If I value a car at $5000, but can’t find that price anywhere, then I simply have to accept that its being valued higher by the market. If I want to sell at $5000, but can’t find a buyer, same story. Even if both persons exist simultaneously, if they can’t find each other, then there will be no sale.
So by making use of the information disparity, and manipulating the perception of the used market, it should be possible to keep prices artificially high.
The same kind of strategy works for diamonds at least, where “used” diamonds are not worthy of usage, so prices are simply set by the businesses; I know the video game market is also trying to get in on it, by gobbling up used games (eg through gamestop), keeping them out of the secondary market early (by encouraging sequels, trade-ins, etc), which then lets them set the prices on them later (particularly useful when you want to sell emulated games on the e-shops)
> So by making use of the information disparity, and manipulating the perception of the used market, it should be possible to keep prices artificially high.
It seems like this would be really hard to pull off, though, because apparently they're simulateneously keeping prices artificially low.
I can see them keeping the casual buyer and seller ignorant of each other's existence -- especially if they're fixing up the pianos and selling them as 'certified refurbished' (or whatever), so they're not simply buying low and selling the exact same product high.
But wouldn't the whole thing crumble when a few enthusiasts got together and discussed their experiences as buyers and sellers -- or when a few sellers (whether through ignorance or knowledge) publically and successfully held out for higher prices?
If the general population of buyers does not expect to find grand pianos on craigslist, then why would they end up on craigslist to find it? More likely, the best hope you have is to sell it to someone who found it by accident, probably not even looking for such a thing at the time. And if selling grand pianos on craigslist is sufficiently rare, then it’ll naturally not change anyone’s expectations; it was just a lucky find.
And ofc, if you the adversarial company are purchasing out these rare sales as soon as they’re up, you can trivially maintain the illusion.
That individual sale might cost you more, but if the average seller sells for less because they don’t see a real market to sell in... it’s probably still a profitable illusion.
(I responded to your other comment, but this one covers some of the same ground.)
It still seems strange to me that this would work, when there are so many easy ways for piano enthusiasts to gather and communicate, and when it's such an expensive item (so if you knew the market was being manipulated, you wouldn't just throw up your hands and accept the hit, you'd look for a better deal).
I might be getting confused about the basic claim being made, though -- if sellers can achieve decent prices when they choose to demand them, but often don't realise this and therefore get ripped off by professional buyers; and if buyers can save money by buying directly from individual sellers, but are often unaware of this option (because there aren't a whole lot of pianos being sold this way, and they're not on the market for long); then I guess that does make sense.
Is that really a thing? Seems like a great way to lose money.