Re-Tales #30: Just Keep on Usin' Me

Those of us who aren't wealthy must often sell something before we can buy a new piece of hi-fi gear, and it's usually another piece of hi-fi gear. Selling in order to buy makes a great deal of sense because, after all, you only need one of everything (or two in the case of speakers) at a time in a two-channel system.

Another secondary-marketplace incentive: As I pointed out a couple of Re-Tales columns ago, the higher prices rise on new equipment, the more appealing pre-owned gear becomes.

Hi-fi dealers know this, and they've known it for a long time. "Typically, the onus is on the dealer to facilitate trades, since most manufacturers don't deal with it," Aaron Sherrick, owner of Harrisburg, Pennsylvania–based dealership Now Listen Here, told me in an online interview. As I reported last month in this space, Now Listen Here recently expanded into a new location in Falls Church, Virginia, alongside Archer High Fidelity. "I'm doing more trades than ever," Sherrick told me. He estimates that about two-thirds of his sales involve trades. Now Listen Here also offers consignment sales.

When it's time to sell, audiophiles usually go online, and many websites cater to sellers and buyers of preowned equipment. Audiogon, US Audio Mart, Reverb, and eBay are major players. Wouldn't it be nice, though, if you could skip that step? Accepting trades "makes the purchase easier on the customer—reselling gear can be a nightmare," Sherrick said. "Trading in is also easier because it's one transaction that happens at one point in time. Someone doesn't need to sell something before they can buy the new thing."

Accepting trade-ins can lubricate sales of new equipment, but while dealers are very active in the used–hi-fi marketplace, few manufacturers involve themselves.

Wilson Audio Specialties is an exception. Working with its dealers, Wilson has formalized a robust trade-in and recertification program dubbed "Certified Authentic." Hi-fi wasn't the first industry to come up with the idea. "We stole this program idea from the automotive industry and tweaked and adjusted it," Wilson Account Executive/Dealer Trainer Bill Peugh told me in an interview.

Preowned Wilson speakers are deemed "Certified Authentic" if they meet certain criteria. Three "CA" tiers exist. "CA Never Titled" means a pair of speakers is nearly new, with that same five-year warranty new speakers are sold with. "CA Factory Tested" is self-explanatory; the warranty duration on "Factory Tested" equipment varies. "CA Pre-owned" is the most common: All the resistors get changed, and other upgrades are performed case by case.

"Most successful Wilson dealers take trades on 75% to 80% of their sales," Peugh told me in a recent phone interview. All the speaker models Wilson has ever made are eligible for the program. Dealers are incentivized to accept Wilson speakers on trade, but other brands are accepted as well.

Peugh attributes Wilson's growth partly to this positive attitude about accepting trades. It's about building customer loyalty. "We remove all the headaches," Peugh said about loudspeaker trade-ins. "The dealer packs them up, takes them away." Off they go to the Wilson factory to be checked out, reconditioned, upgraded. The next step is easy, too: Dealers are required to install Wilson speakers in the customer's home whether they're new or preowned.

Peugh wants to ensure that every customer is treated like a new buyer. "Some of our most loyal Wilson owners have only ever bought used," he told me. "And we're good with that."

In our interview, Peugh's passion for the program was clear. He's using Wilson as a "bully pulpit" to lead an industry trade-in charge, he told me: "The concept that a manufacturer should somehow devalue a used sale is very shortsighted on the manufacturer's part." He believes it's part of what's wrong with the industry. "I think it sends a bad message when everyone is not doing it," he said of trade-ins. He says he spends a lot of time convincing other manufacturers to start accepting trades.

Other manufacturers are getting on board. Audio Research has a limited, focused approach to Certified Pre-Owned (CPO), according to Audio Research Director of Sales David Gordon. Right now, ARC accepts trades on just two products, the REF 6 preamplifier and REF Phono 3 phono preamplifier, both accepted in trade against newer SE versions. The company intends to expand the program.

Some manufacturers fear that preowned sales will cut into sales of new equipment. Gordon, though, said that ARC's certified preowned sales "do not affect sales of the SE models." Rather, those models (re)sell to people shopping for gear at a lower price. "For someone who can't [afford to] acquire a new REF 6SE, that person will be very happy to save about $7500 and get a REF 6 CPO." That customer might then upgrade later.

Other manufacturers accepting trades include Transparent Cable and PS Audio; PS Audio even accepts other makers' gear. "We can buy back your treasured old gear, regardless of its brand or type, for its full retail value," the website says. PS Audio works with The Music Room, a high-volume online resale specialist, to sell off the used equipment it takes in. Online retailer Music Direct accepts trades selectively against the purchase of new gear, reselling trade-ins on, where they have their own shop.

Bryston's James Tanner, who for the last year or so has been promoting refurbishment services for older Bryston models, told me by email that Bryston is "looking at the Trade Up program early in the new year and are still working out the details." I'm writing this mid-December, so updates might be available by the time you read this.

Cost- and value-wise, preowned sales can remove barriers to entering high-end audio, producing new customers. What could be better than that? There's only one answer: Long-term, loyal customers.

ok's picture

takes me back to my childhood.

PeterG's picture

Great piece. I love trading in/up. On more expensive gear in particular, it makes "irrational" purchases more rational. This gear should all be used for 10-20 years by someone