How much does a Pawn Shop cost to buy?

A typical Pawn Shop sells for 3x to 5x seller's discretionary earnings. With estimated SDE of $154K, expect to pay roughly $462K to $770K before adjustments for assets, debt, growth, and local market quality.

How much does it cost to start a Pawn Shop?

Startup costs range from $50K to $300K depending on location, equipment, and scale.

Physical

Pawn Shop

The only store where customers pay you to borrow their own stuff back

Bottom line

Worth studying, but do not buy without strong local proof.

Pawn shops operate as a dual-revenue business: they lend money against collateral (jewelry, electronics, tools, instruments) and sell forfeited items at retail. The lending side charges 15–25% monthly interest — legal, regulated, and extremely high-yield. Forfeited items become pure-margin inventory at zero additional cost. A well-run shop in a dense market generates $500K–$2M in revenue with 40–50% gross margins. Private equity has been rolling up the sector for years.

See listings →Compare ↔

Share LinkedInReddit HN

Acquisition score

Margin · multiple · SBA data

48Fair

Avg revenue

$700K/yr

$250K–$2M range

Profit margin

22%

~$154K SDE

Multiple

3–5×

of SDE

Est. buy price

$462K–$770K

startup: $50K–$300K

How It Works

Customers bring in valuables and receive a short-term loan (typically 30–90 days) at high interest rates. If they redeem, you profit on interest. If they forfeit, you keep the item and sell it at retail — typically 2–3x the loaned amount. Both outcomes are profitable. Revenue splits roughly 60% retail / 40% loan interest in a typical shop.

BizBite verdict

Watch / verify

Pawn Shop has enough high-level data for a first look, but BizBite has not assigned a category-specific operating model yet. Treat the score as preliminary.

48Fair

low data confidence · 40/100medium financing fit

Why it may work

No strong positives yet. More verified data needed.

Be careful

!Source link status has not been verified yet
!No last-checked date yet
!No SBA category enrichment yet
!No category operating model yet
!Low data confidence

Deal Calculator

Priced off $154K SDE — can this deal service its own debt?

1.72×

DSCR · Lender-comfortable

Purchase multiple — 4.0× SDE ($615K)

Category range: 3×–5× SDE

Down payment — 10% ($62K)

SBA minimum equity injection is 10% for change-of-ownership

Interest rate — 10.50%

Typical SBA 7(a) range: 9.5–12% (prime-based)

Loan term — 10 years

Standard SBA 7(a): 10 years for business acquisition

Purchase price

$615K

4.0× of $154K SDE

Cash to close

$80K

$62K down + ~3% closing

Debt service

$7K/mo

$90K/yr on $554K loan

Cash-on-cash

81%

cash back in ~15 mo

Debt service coverage · what the lender sees

1.72×+$5K/mo after debt

Most SBA lenders want ≥1.25× coverage; 1.5×+ is a strong file.

SDE = revenue × margin estimate for this niche; it includes owner compensation, so budget your salary out of cash flow. Excludes working-capital injection, capex reserves, and taxes. Actual SBA terms vary by lender and borrower.

Pros

+Dual income streams: loan interest AND retail margin on the same inventory
+Recession-resistant — pawn traffic spikes when the economy softens
+40–50% gross margins on retail; 15–25%/month interest on outstanding loans
+Low inventory risk — items are pre-valued before you acquire them

Cons

-State pawnbroker licensing and regulations vary significantly — compliance overhead
-Requires experienced appraisal skills (or staff) for jewelry, electronics, instruments
-Customer base can be challenging to manage; security investment is non-negotiable

Best For

Operators with retail or finance experience who want a high-cash-flow business with built-in inflation protection

Operating Costs

Major costs: staff (2–4 employees), rent (location is everything), security systems, insurance, and loan capital. Gross margins of 40–50% compress to 10–20% net after overhead.