What exactly does a pawn activity consist of?

Question

There's a TV show on the History Channel called Pawn Stars.

According to American Heritage Dictionary of the English Language the pawn's definition is:

Something given as security for a loan; a pledge or guaranty.

My confusion is that no client on that show pawns their items, they simply sell them for good, so I wonder: since the pawn's dictionary definition can't be wrong are they doing another activity than the one written on their logo?

Does pawn mean that admittedly both activities pawning and buying and selling are allowed in such a store? If so why is it not written on the dictionary?

Answer 1

The short version is yes, people often go to a pawnshop intending to sell, rather than pawn, an item. This doesn't mean that the definition of 'pawn' is incomplete, though. To understand how this situation would arise, think about how pawnshops work:

When someone pawns an item, they are borrowing money using the item as security (exactly as the definition says). For a specified span of time, they can bring back the money (plus interest) and get the item back. However, frequently, people who pawn items are unable to come up with the money during that time, at which point the pawnbroker will offer the item for sale to recover the lent funds.

Pawn shops, as a result, become a place where a wide variety of items are available for purchase. Some of those items are more valuable than their owners (or even the pawnbroker) will realize, and so antiques dealers and other experts in obscure goods visit them, hoping to spot a valuable item available for cheap.

As a result of this, the pawnbroker will often be willing to straight-up purchase items, in hopes of making a profit selling them to those traveling dealers, and so people will come to them not only when they need a loan, but when they just want to sell something.

Many businesses are generally understood to offer services that are not, strictly speaking, part of their formal definition. For instance, gas stations almost always have a machine for re-inflating tires. Most pharmacies sell a variety of general household goods in addition to filling medical prescriptions. Banks offer safe-deposit boxes. When enough people who want one service would also want another, and it is convenient to provide it, businesses adapt.

Answer 2

Basically ditto MrTheWalrus, but let me say it in a different way that might be more clear.

As MrTheWalrus said, a pawn shop is a business that, in principle, loans money in exchange for some tangible item offered as security for the loan. So you bring them your old guitar or camera or jewelry or whatever and they give you cash. You then have a specified amount of time to come back with the money plus interest and recover your item. If you don't, they sell the item to get their money back.

In real life, people come to a pawn shop with two very different possible intentions. Some fully intend to come back and recover the item they pawned. They really are looking for a loan. Others have no intention of coming back. They just want to get some cash for an item that they no longer have a use for. (There are probably some who are undecided or not sure.)

I don't have statistics, but I suspect that most of the business at pawn shops today is people simply selling used items, clearly telling the pawn broker that they're not coming back and he can resell the item tomorrow if he likes. Pawn shops have basically become used goods stores.

Answer 3

Pawning is usually only done by those in desperation. It is not a smart financial move in the long-term, and not very common. The show Pawn Stars is only about the most high-profile antiques being sold at their particular pawn shop. They aren't going to show desperate folks coming in to pawn their belongings for a quick buck, because it's not interesting, or at least not in line with the show's goal (to show interesting antiques and oddities, and the characters selling them).

As for the title itself, it is merely a pun on the phrase "porn star," referring to a high-profile actor or actress in the adult film industry. The title "pawn shop" is somewhat misleading taken literally, but it has stuck as the dominant term to describe an independently-owned shop that buys and sells used items of all kinds. These shops still offer the pawn service, it is just not as popular as it once was thanks to the existence of lending banks and other modern services.

Answer 4

No, pawning refers specifically to getting a loan using an object as collateral. But you're right, most people on Pawn Stars are selling, not pawning.

In the introduction to his book License to Pawn, Rick Harrison of Pawn Stars writes:

If you don’t know how a pawn shop works—and many people in “reputable society” don’t—here’s a primer:

The majority of our business, probably 60 percent, consists of pawns. If someone sells an item, it’s straightforward. They get their money, always in cash, and I get the item. If an item is pawned, it’s a loan. We charge a five-dollar device fee and 10 percent interest per month.

On Pawn Stars, the vast majority of the customers you see are selling, not pawning. There's a simple reason for that: Most people who are in the position where they have to pawn something don't want to be shown on television. There's a stigma attached to it, which is why it's legally considered a private transaction between the pawnbroker and the customer.

They have occasionally shown a customer pawning something, but those are few and far between.

Because a pawn shop needs to sell the items that people pawn but are unable to redeem, they are also willing to simply purchase items from people who know they won't be redeeming them. In fact, you can get a slightly better price by selling instead of pawning, because the shop doesn't have to store the item for months before they can put it on sale.