Mint and proof sets, buying and selling
logger7
Posts: 8,691 ✭✭✭✭✭
A local long term collector of US mint sets called me up wanting me to come over to look at his collection and maybe buy it. So I went over the Greysheet pricing of his coins. I bought a folder of low grade Peace dollars, a few Morgans that were in a tin. He also had an Ike set in a Dansco holder. Most all the raw classic coins were low grade. Then when leaving he asked me to take a box of some of his proof sets and mint sets to sell for him. It took a long time to list them, and I did that in groups priced at wholesale. I've sold around a half of the group in a week. A long time dealer said the way I priced them with shipping profit was just too low to justify selling them on ebay. I know for many dealers these are the bane of their buying and selling, too bulky and minimal profits. I know there are buyers who will pay upwards of 80-90% of Greysheet. Is that the best way to go?
Comments
Despite the new higher bids there are lots of buyers right now for the mint sets at 90 to 110% of bid.
Proof sets are strong as well but bids aren't up as much.
So do you list individual sets or multiples? I see a lot of relatively common ones listed for around $8 and change delivered.
I don't know and am still learning.
Wholesalers are paying 90 to 110% of bid.
I believe nice Gem sets can get huge premiums on eBay but am not sure. Choice sets probably should be shipped and typical sets sold as lots on eBay.
I've wholesaled most of my sets so far but am selling a few on eBay with highly mixed results.
Lots of time and effort for very little money.
Prices have tripled in some cases and everyone has these by the million.
It all adds up.
I do agree though that listing sets individually is still to be avoided unless they bring a substantial premium.
I sold about half of the sets in a box a retired collector gave to me on consignment to sell on ebay.
Gross profit so far is around $290, ebay 10% including cc processing, shipping around $70. Hours of effort and little profit; I told the collector to pay me what he thought was right, it is not worth holding out for more as this is like community service to the hobby.
Back in 2006/7 I sold a large number of low value coins on eBay. That was a big mistake. The amount of time and effort I put into selling it was huge. The payoff was minimal once the fees were deducted. Today the fees are much higher.
@logger7 .... I look at sets when available at gun shows or yard sales... Still watch for specific dates. I stopped buying them back around 2004 or so.... So just certain sets I still look for. Are you listing on BST?? Cheers, RickO
I'll probably ask around and try to find a dealer who will pay 80-90% of Greysheet; I told the guy I would pay him 50% of Greysheet. He has some 90% and a few numismatic coins where I can make some money, but not on the sets. Hours of work and he wants to pay me 20% of the net profit which leaves me with $38. Community service.
Ok- say a set sells for $8.50. eBay gets about 70 cents and first class shipping is about $4.00. Net profit = $3.80, 20% is about 75 cents.
"Community service" sounds about right.
A local dealer agrees there is not much margin in proof sets but half of grey sheet ? C'mon. So Grey sheet is meaningless but you still subscribe ?
This guy has been in the family business for 60 or 70 years now. They sell a lot of this stuff.
I don't subscribe, a real dealer gave me a copy a few months ago. For me this is a hobby business.
I'm thinking if you buy $500 worth of sets based on Greysheet, give the seller 50% and can find a dealer wholesaler who will pay 80-90% of Greysheet that that is the way to go. Extra costs are shipping and assuming the wholesale buyer sees no "issues" with the sets.
It is difficult to find a local buyer at anywhere near bid. There are some but finding them is unlikely. Most local buyers are acting as jobbers for other dealers and mostly buy from dealers and other local sellers. The best bet is to plan on shipping the sets. Varieties, Gems, and special sets might be worth the trouble on eBay.
The highest buyers don't want bad sets so this complicates things a lot. Plan on selling most to wholesalers who pay a little less than bid and will take everything even if every set isn't pristine. There's still not a lot of profit in these sets even if you can get them in large quantities. So don't expect a big windfall.
So if many gauge value using Grey Sheet but it won't matter much if any, then what is Grey Sheet ?
This is part of the problem.
For most practical purposes Grey Sheet bid is the retail price in coins. But very few dealers want to "mess" with anything modern so pay well back of bid. Indeed, on many things they still want to pay melt value because they don't have a market for moderns. This is not really the fault of dealers but rather just the nature of the beast; very few people collect coins minted after 1965. Getting a premium on a nice roll of '53-D quarters isn't so hard but getting bid on a roll of 1973-D quarters is almost impossible without shipping it. Dealers don't have customers for moderns so buy it for next to nothing.
Another problem is that "bid" for moderns implies the coins are choice. Inferior moderns are often discounted. Most collectors would be astounded how few rolls there are of something like '71-S cents and the huge percentage of them that are spotted or otherwise unsaleable. A BU '49-S cent has a million customers but a BU '71-S cent has a mere handful and they tend to all be wholesalers.
I believe these markets are just beginning to undergo a massive transition and how it plays out is anyone's guess. World moderns have had enormous increases due to actual scarcity and a little bit of demand. US moderns have long had very little demand but not quite as much scarcity, but the potential demand for US moderns is huge and is growing rapidly.
The change will be subtle at first as bid comes to reflect whatever is available because even finding "common" cents like '84-D's that aren't corroded is tough.
Don't believe any catalog prices. They are far too low on most coins which trade at higher prices. Many moderns sell at retail and retail is multiples of bid. A nice choice '67 quarter might retail at $15 but the Redbook lists it as a $1 coin. An old cent that lists at $1 is really worth about a dime. To say the catalogs are misleading is a massive understatement.
I've successfully used Greysheet for 20 years. If you understand greysheet and monitor the market, it is invaluable.
Why do you need an 80% profit margin on a wholesale flip?
On the first group I probably spent at least 6-7 hours already going to the guy's house, reviewing what he had and listing and shipping the items as I have tried to avoid these like many. On Saturday a blizzard shut everything down, even the post offices closed early but I was able to somehow get them shipped. Selling these coins is masoquistic enough; who needs critics who insist everyone put on a hairshirt in the morning? I guess you missed the comments from others that getting 80-90% from wholesalers is very difficult.
I was going by your numbers. You said "'I'm thinking if you buy $500 worth of sets based on Greysheet, give the seller 50% and can find a dealer wholesaler who will pay 80-90% of Greysheet that that is the way to go."
If you're selling them one at a time, that's different. But I buy proof sets all the time at 70-75% of greysheet and flip them wholesale at 75 to 80% of greysheet. Takes almost no work if you are wholesaling the entire group. It's a whole different story if I'm selling $6 proof sets one at a time.
Have you factored what you're going to do, if you do some other sales on eBay and your sales exceed $600 and eBay issues you a 1099, that you then have to file taxes on? I hope you're keeping good paperwork on all of your expenses, costs, profits, etc...
Some politicians people did something!
BST references available on request
If you sell them to a dealer or in the BST, you still owe taxes on profits and still need to file.
Sooner or later that will sink in.
???
BST references available on request
He's talking about this:
"Have you factored what you're going to do, if you do some other sales on eBay and your sales exceed $600 and eBay issues you a 1099, that you then have to file taxes on?"
Based on prior posts on this message board, some people appear to believe that if they're not running a business, they shouldn't be expected to pay taxes on their profits. Because reasons. It has nothing to do with eBay or anything they report to the government or whether or not you get a 1099, you still owe them. And this fact has been mentioned before. Therefore, "sooner or later..."
Sorry. I'm confused as to how you calculate "gross profit". What is your cost of goods sold? I guess what I'm asking is if he's consigning, then why would you have a capital outlay? Or is he using his purchase price from whenever? Or is $290 your revenue?
I realize it's tough these days trying to make a profit but sounds like you are trying to justify margins based on delivery schedules and who knows what else. Proof and Mint sets are one thing but is it any wonder why more collectors use auctions to sell certified coins ?
Certainly using auction houses or dealers to sell puts the burden on the auction house and the dealer to do all of those things. However, passing the buck (pun intended) on the work involved comes at a cost. For a $50 to $100 coin, the cost of sending it to GC to sell will possibly end up with significantly less money in your pocket. For a $50 coin - assuming identical total sales price at all venues including shipping and ignoring sales tax - eBay fees (with store) and shipping are a total of $9. The total GC fees for the same coin are about $20 (including shipping). The total fees at some place like heritage are closer to $40. [Including BP and SP and the GC set-up charge and including the cost of shipping in all venues.]
The calculation is significantly different for $1000 coins. But the point is that not everything can be efficiently sold via an auction house.
The 2022 "Red Book" lists the 1967 Quarter at $2 in MS-63 and $6 in MS-65. Those values are too low to cover the cost of certification. It has also been my observation that the grading is disappointing on many modern coins. You have find at least an MS-67 graded piece to have me sit back and say, "Ahh, that's nice."
The high grade moderns have to be certified to bring a decent price, and it is my perception that most of the buyers are looking for coins to go into their registry sets.
Let's face it A dollar isn't worth much any more, and it's not worth a dealer's time to package this stuff and offer it for sale, especially when it ends up selling very slowly.
So who are some of these “wholesale dealers” that buy this stuff? Got any names?
Littleton
A coin can grade MS63 or MS65 without being in a slab. There is nothing in my Red Book that indicates prices are for certified coins.
Or put another way:
Some people appear to believe that if they're not running a business, and therefor, some bullies politicians should not look at garage sale type profits as their own personal piggybank to pay for their programs.
BST references available on request
A low grade coin in a slab is still worth very little unless it’s a sample slab or is marketed to a person who is totally enamored with certification.
A roll of '67 quarters is $40 according to Redbook. This is based on the MS-60 price. But the fact is most '67 quarters sell at retail in a tiny niche market where nice attractive BU's (MS-60 to MS-64) sell for 5 or $6. To supply this tiny market Greysheet lists the BU roll price at $155 ort nearly $4 per coin. ChBU '67 quarters sell for 6 or $8 and very choice gemmy coins go for $15. But you say Redbook lists an even higher grade (MS-65) for $6. A true Gem '67 is pretty tough but they are out there. It was a well made date. So why does a ten cent old coin list for $6 but a $25 modern list for $6? Across the board the guides list scarce moderns for less than the BU roll price!!!
This is severely damaging to the markets because newbies don't want to pay actual market price when it's many multiples of Redbook.
Grading of moderns seems to be a little more "fluid" than other coins but there is a market for ungraded moderns even in chGem. But don't expect to find these prices listed in guides. And if they were listed they would be unrealistically low. This is a huge wet blanket on a simmering market.
Mint and proof set prices are an effect of the cataloging nonsense. Most collectors know that these sets hold most of the Gems anyway so they are searching them. I think the lid will blow off when the mint sets get hard to find and mint set rolls dry up. How can anyone put together a few rolls of '74 Ikes if you can find the sets only one or two at a time and their price is much higher?
Frankly I think the only thing holding mint set prices from going stratospheric right now is the simple fact that most coins in most of the early sets are tarnished. Bids would be far higher if buyers could be sure of getting pristine sets. As long as the damaged sets aren't being cleaned more and more of the damage will be permanent. It's an unusual circumstance but the root of the problem is as old as history; there is less supply than demand.
There are a few;
http://www.azcoinexchange.com/buylist.htm
I search "mint sets" periodically on duckduckgo and am seeing a huge proliferation of sellers. A few years ago there were only four or five major sellers and now there are 15 or 18 and include Walmart and Amazon. There are still few serious buyers but then the sellers are constantly running out of stock.
https://www.thecoinshop.shop/us-mint-sets
Most of the best buyers are really jobbers and most operate locally. They buy principally for promotions or to supply wholesalers or the TV shows. There are buyers who need to be able to lay their hands on stock in a timely manner.
Mint sets have been flowing from estates to coin shops to the wholesalers for many many years but this is breaking down in part because the demand is siphoning off supply throughout and because the number of sets flowing onto the market is being choked off because the original buyers have all passed on. This leaves the sets purchased after the date of issue by collectors or the general public. I believe these are insufficient to supply the burgeoning demand.
It's going to get far worse when dealers start trying to stock coins like '67, '69, or '83 quarters. There is no discernable wholesale market for these and the sets are gone and supplies exhausted.
I suppose this all started about 2018 but is moving far more slowly than I ever expected. And of course far later than I had believed possible.
Garage sale profits is an oxymoron. The exemption for garage sales is NOT the venue. The exemption is for selling used goods at below purchase price. Your garage sale profits would also be taxable.
The Red Book is barely a price guide. Only newbies would use it a such. It is a wealth of information, but pricing really isn't one of those things.
I fully agree.
What I don't understand is why an old Lincoln cent that lists for a dollar is worth a quarter and a modern that lists for a dollar is worth $4.
In general prices listed in Redbook are high to very high, with exceptions of course but moderns tend to be low and sometimes extremely low. Newbies may well be influenced by this and any influence is detrimental to demand. If a newbie wants a nice '67 quarter he just might hold out for a better price especially when the seller is asking $15 for a "one dollar coin". This coin wholesales for $4 so why the one dollar price?
I think moderns are a bit complicated. While you are the king of clad, most dealers either don't bother or sell at prices closer to Red Book because they don't want to hold inventory of such things.
They just don't have customers for most clad.
Dealers have always tried to stock one or two of each mint and proof sets because rarely a retail customer will come in for them. But nobody ever asks dealers for a roll of '67 quarters or even for a single. A few dealers will keep books with a few clads in them but they don't make much money on them and they have difficulty acquiring stock because it's hard to find most moderns at bid other than mint sets.
Even popular moderns like Ikes are usually sold on-line rather than in a brick and mortar. If the local dealer could buy a roll set of Ikes which is very highly improbable he'd have no recourse but to ship it. Without knowing the market he might be inclined to tell the would be seller to take it to the bank. Wholesale on this $160 set would be $1,150 by the way.
If it's true that it is demand causing the shortage of mint and proof sets then things should be changing pretty soon. Witrh all the new sellers it could be just trying to fill the pipeline.
My comment was going to be along the lines of there being no tax liability when you by clothes for $20 and sell them for 10c. Selling something on Craigslist, or anywhere, for more than you paid is completely different, and would not happen at a typical garage sale.