@DisneyFan said:
If you are buying needed coins for inventory, you have no interest in selling them to another dealer.
Dealers buy coins for inventory and end up selling them to other dealers all the time.
@DisneyFan said:
In today's active market, coins are being sold above Greysheet guide prices.
Well- yeah. Retail prices are different from wholesale prices.
We do understand each other. When I refer to "needed" coins, I'm not referring to run of the mill coins; but, coins that would stand out in your inventory and/or can be quickly sold, possibly to someone who has never bought from you before. Why would you want to sell them to another dealer, unless you want to be basically a wholesaler? Yes, I know, cash is cash; but....
Dealers seek opportunities to sell coins at a profit and quick turnover (to other dealers) allows for cash for other opportunities. The more the churn with profits, the more profitable the business when considering the time value of money. I'm not a dealer, but that's my take.
EOC disagrees, but most businesses value turnover, often more than gross margin. If I turn $1 million and it takes a year, a 10% margin nets $100k. If I turn $1 million monthly on a 1% gross margin. I make 20% more with lower risk.
Price guides are just that- guides. Be it PCGS providing a suggested retail value, CAC values with the bean, or greysheet suggesting a wholesale value. they are all just guides.
Best to draw on all available price guides, auction price histories, and current inventories available to get a sense of the current value on something specific.
And then there is the merits of the specific coin one is valuating....
I don't see how any of the popular pricing guides can keep pace with current market.
marmac
Dead on correct
I believe that our host and CAC are about 3 months behide based on the auction prices that are being paid for those "Special" coins
Like I said earlier, you want it Pony Up.
@marmac said:
Price guides are just that- guides. Be it PCGS providing a suggested retail value, CAC values with the bean, or greysheet suggesting a wholesale value. they are all just guides.
Best to draw on all available price guides, auction price histories, and current inventories available to get a sense of the current value on something specific.
And then there is the merits of the specific coin one is valuating....
I don't see how any of the popular pricing guides can keep pace with current market.
In today's market ...My system is .. as you say...Is to draw on all available price guides, auction price histories, and current inventories available to get a sense of the current value on something specific. I look back 20 years for some perspective. I mainly buy DE's.
I markdown the coins I buy to spot gold as I am always prepared and expect to write off the premium when the music stops. I think of the difference as my "bad debt reserve".
I keep playing as long as I hear a symphony and I continue to sell coins.
The game for me, ends when I am buying above retail and selling below wholesale. Then I bring out the "bad debt reserve sheet" and beat myself up (and worse yet...the wife yells at me).
If dealers buy and sell between themselves at GS, it's clear they're going to pay less than that when buying from collectors.
Depends on how badly they need the coins for inventory.
You can buy all the inventory you want but it won't do you any good if you pay a collector to acquire it and sell it for the same price to another dealer. If GS is dealer to dealer pricing (that's what the GS itself says it is), dealers need to pay less than GS prices for coins bought from people who are not dealers.
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc. Yes, I realize there are costs associated with those sales, but my general experience is those costs tend to be often substantially less than selling below GS given the prices realized I see at these venues. Of course, there are exceptions....
@DisneyFan said:
If you are buying needed coins for inventory, you have no interest in selling them to another dealer.
Dealers buy coins for inventory and end up selling them to other dealers all the time.
@DisneyFan said:
In today's active market, coins are being sold above Greysheet guide prices.
Well- yeah. Retail prices are different from wholesale prices.
We do understand each other. When I refer to "needed" coins, I'm not referring to run of the mill coins; but, coins that would stand out in your inventory and/or can be quickly sold, possibly to someone who has never bought from you before. Why would you want to sell them to another dealer, unless you want to be basically a wholesaler? Yes, I know, cash is cash; but....
Dealers seek opportunities to sell coins at a profit and quick turnover (to other dealers) allows for cash for other opportunities. The more the churn with profits, the more profitable the business when considering the time value of money. I'm not a dealer, but that's my take.
EOC disagrees, but most businesses value turnover, often more than gross margin. If I turn $1 million and it takes a year, a 10% margin nets $100k. If I turn $1 million monthly on a 1% gross margin. I make 20% more with lower risk.
@JimW said:
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc.
Just like doing your own plumbing repairs instead of hiring the work out can leave dollars in your pocket, it depends on how much effort you want to put into selling your coins.
Another thing to consider is that some dealers do buy coins for their inventory via eBay, GC, etc. If they happen to be the buyers of your coins in those venues, are the prices you're getting after fees better than what you'd get selling directly to the dealer?
@DisneyFan said:
If you are buying needed coins for inventory, you have no interest in selling them to another dealer.
Dealers buy coins for inventory and end up selling them to other dealers all the time.
@DisneyFan said:
In today's active market, coins are being sold above Greysheet guide prices.
Well- yeah. Retail prices are different from wholesale prices.
We do understand each other. When I refer to "needed" coins, I'm not referring to run of the mill coins; but, coins that would stand out in your inventory and/or can be quickly sold, possibly to someone who has never bought from you before. Why would you want to sell them to another dealer, unless you want to be basically a wholesaler? Yes, I know, cash is cash; but....
Dealers seek opportunities to sell coins at a profit and quick turnover (to other dealers) allows for cash for other opportunities. The more the churn with profits, the more profitable the business when considering the time value of money. I'm not a dealer, but that's my take.
EOC disagrees, but most businesses value turnover, often more than gross margin. If I turn $1 million and it takes a year, a 10% margin nets $100k. If I turn $1 million monthly on a 1% gross margin. I make 20% more with lower risk.
Nothing in that very hypothetical situation indicates anything about time spent. If I'm flipping wholesale at 2%, it is much LESS worth than running to shows, consigning to auction, etc for 10%.
@JimW said:
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc.
Just like doing your own plumbing repairs instead of hiring the work out can leave dollars in your pocket, it depends on how much effort you want to put into selling your coins.
Another thing to consider is that some dealers do buy coins for their inventory via eBay, GC, etc. If they happen to be the buyers of your coins in those venues, are the prices you're getting after fees better than what you'd get selling directly to the dealer?
The Great Auction Myths
Half the people think they are getting a deal at auctions because they are buying wholesale.
The other half think they are getting better money because they are bypassing dealers and selling retail.
If dealers buy and sell between themselves at GS, it's clear they're going to pay less than that when buying from collectors.
Depends on how badly they need the coins for inventory.
You can buy all the inventory you want but it won't do you any good if you pay a collector to acquire it and sell it for the same price to another dealer. If GS is dealer to dealer pricing (that's what the GS itself says it is), dealers need to pay less than GS prices for coins bought from people who are not dealers.
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc. Yes, I realize there are costs associated with those sales, but my general experience is those costs tend to be often substantially less than selling below GS given the prices realized I see at these venues. Of course, there are exceptions....
Liquidity and confidence. If I go to a dealer I can get my $1000 that day. If I go to eBay or GC or etc. then it might take me months to get my $1300 or I could run it at a true auction and get my money in two weeks, but I'd get between $800 and $1300 with no real way to guess who will come to auction that day.
If dealers buy and sell between themselves at GS, it's clear they're going to pay less than that when buying from collectors.
Depends on how badly they need the coins for inventory.
You can buy all the inventory you want but it won't do you any good if you pay a collector to acquire it and sell it for the same price to another dealer. If GS is dealer to dealer pricing (that's what the GS itself says it is), dealers need to pay less than GS prices for coins bought from people who are not dealers.
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc. Yes, I realize there are costs associated with those sales, but my general experience is those costs tend to be often substantially less than selling below GS given the prices realized I see at these venues. Of course, there are exceptions....
Liquidity and confidence. If I go to a dealer I can get my $1000 that day. If I go to eBay or GC or etc. then it might take me months to get my $1300 or I could run it at a true auction and get my money in two weeks, but I'd get between $800 and $1300 with no real way to guess who will come to auction that day.
Cash flow is king for sure and this hobby can gobble up wheel barrels full of cash!
On that philippine peso 1904-S in 65 at $31000. . Wow what a price!
How many out there willing to pay that? usually two guys bid it up
but what was the third guy willng to pay ?
Back in the late 80's or early 90's. As I recall 3 or 4. original BU Rolls came out of the 1904-S pesos and similar of the 1903 Fifty centavos. I think before PCGS existed.
All were Gobbled up quick. I have two raw probably 64's? I wonder how many still out there raw.
like the original roll of BU 1915-S centavos (keys) that I saw/ was offered back then for $5K. I don't think they ever showed up.
probably in someones SD box.
@DisneyFan said:
The original poster gave two examples with 100% markups. Both are not run of the mill coins.
1811 CBH MS62 small 8
G - $1850
PCGS - $4000
1827 CBH MS63
G - $1700
PCGS - $3550
There is a lot of play in those bid and ask numbers and yes, a dealer might wholesale them or retail them depending on the dealer's business plan.
Those numbers don’t necessarily have anything to do with “markups”.
Agreed - both numbers are guides which is why there is a lot of flexibility with actual wholesale and retail pricing. Are you able to access better price guides that narrow the spreads or are these spreads "it is what it is" and actual results depend on the negotiating skills of the two sides?
@DisneyFan said:
The original poster gave two examples with 100% markups. Both are not run of the mill coins.
1811 CBH MS62 small 8
G - $1850
PCGS - $4000
1827 CBH MS63
G - $1700
PCGS - $3550
There is a lot of play in those bid and ask numbers and yes, a dealer might wholesale them or retail them depending on the dealer's business plan.
Those numbers don’t necessarily have anything to do with “markups”.
Agreed - both numbers are guides which is why there is a lot of flexibility with actual wholesale and retail pricing. Are you able to access better price guides that narrow the spreads or are these spreads "it is what it is" and actual results depend on the negotiating skills of the two sides?
Prices from two different price guides are not the same thing as “spreads”. A spread is the difference between what someone will buy and sell for. And that depends on the seller, the coin and the market, not on listed prices from two different guides.
Another thing to keep in mind is that prices in guides are often unrealistically high or low. It’s actual transactions that count.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
@DisneyFan said:
The original poster gave two examples with 100% markups. Both are not run of the mill coins.
1811 CBH MS62 small 8
G - $1850
PCGS - $4000
1827 CBH MS63
G - $1700
PCGS - $3550
There is a lot of play in those bid and ask numbers and yes, a dealer might wholesale them or retail them depending on the dealer's business plan.
Those numbers don’t necessarily have anything to do with “markups”.
Agreed - both numbers are guides which is why there is a lot of flexibility with actual wholesale and retail pricing. Are you able to access better price guides that narrow the spreads or are these spreads "it is what it is" and actual results depend on the negotiating skills of the two sides?
Prices from two different price guides are not the same thing as “spreads”. A spread is the difference between what someone will buy and sell for. And that depends on the seller, the coin and the market, not on listed prices from two different guides.
Another thing to keep in mind is that prices in guides are often unrealistically high or low. It’s actual transactions that count.
This.
People should not be comparing and contrasting those two DIFFERENT guides. They may not even use the same data to generate their numbers.
CDN Exchange has bid/ask numbers. You can see the spread there. If you're a member. However, such data is really only useful for widgets since there are rarely open bids much less asks for truly scarce coins
@JimW said:
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc.
Just like doing your own plumbing repairs instead of hiring the work out can leave dollars in your pocket, it depends on how much effort you want to put into selling your coins.
Another thing to consider is that some dealers do buy coins for their inventory via eBay, GC, etc. If they happen to be the buyers of your coins in those venues, are the prices you're getting after fees better than what you'd get selling directly to the dealer?
Thanks to all for the interesting and enlightening discussion! Generally, IMO, if dealers are buying coins via eBay or other places where there is competition with collectors, they are probably not buying below sheet. As I indicated, I am sure people can come up with exceptions. But yes, one does need to consider the fees, shipping, etc. to determine what you are actually going to end up with in the end. And I do see points made by others related to uncertainty, timing, etc. I suppose for any given coin one needs to do their homework to figure out the best sell strategy.
@JimW said:
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc.
Just like doing your own plumbing repairs instead of hiring the work out can leave dollars in your pocket, it depends on how much effort you want to put into selling your coins.
Another thing to consider is that some dealers do buy coins for their inventory via eBay, GC, etc. If they happen to be the buyers of your coins in those venues, are the prices you're getting after fees better than what you'd get selling directly to the dealer?
Thanks to all for the interesting and enlightening discussion! Generally, IMO, if dealers are buying coins via eBay or other places where there is competition with collectors, they are probably not buying below sheet. As I indicated, I am sure people can come up with exceptions. But yes, one does need to consider the fees, shipping, etc. to determine what you are actually going to end up with in the end. And I do see points made by others related to uncertainty, timing, etc. I suppose for any given coin one needs to do their homework to figure out the best sell strategy.
You would be surprised how often things sell below sheet even at major auction houses.
@JimW said:
Generally, IMO, if dealers are buying coins via eBay or other places where there is competition with collectors, they are probably not buying below sheet.
If they're buying for inventory they're not paying retail, that's for sure.
Comments
If you think the guide provides accurate values, why don't you also use it when buying coins?
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
Price guides are for typical coins, not ones that are out of the ordinary for their grade.
Greysheet updated again and now it's $250 higher than PCGS price guide... Weird.
1868 $3 in AU58
My YouTube Channel
EOC disagrees, but most businesses value turnover, often more than gross margin. If I turn $1 million and it takes a year, a 10% margin nets $100k. If I turn $1 million monthly on a 1% gross margin. I make 20% more with lower risk.
Price guides are just that- guides. Be it PCGS providing a suggested retail value, CAC values with the bean, or greysheet suggesting a wholesale value. they are all just guides.
Best to draw on all available price guides, auction price histories, and current inventories available to get a sense of the current value on something specific.
And then there is the merits of the specific coin one is valuating....
I don't see how any of the popular pricing guides can keep pace with current market.
marmac
Dead on correct
I believe that our host and CAC are about 3 months behide based on the auction prices that are being paid for those "Special" coins
Like I said earlier, you want it Pony Up.
Mike
My Indians
Danco Set
In today's market ...My system is .. as you say...Is to draw on all available price guides, auction price histories, and current inventories available to get a sense of the current value on something specific. I look back 20 years for some perspective. I mainly buy DE's.
I markdown the coins I buy to spot gold as I am always prepared and expect to write off the premium when the music stops. I think of the difference as my "bad debt reserve".
I keep playing as long as I hear a symphony and I continue to sell coins.
The game for me, ends when I am buying above retail and selling below wholesale. Then I bring out the "bad debt reserve sheet" and beat myself up (and worse yet...the wife yells at me).
I agree with the premise - but then it makes me wonder why any collector would sell to a dealer when there are other options to get better prices, e.g., collector to collector via eBay, GC, etc. Yes, I realize there are costs associated with those sales, but my general experience is those costs tend to be often substantially less than selling below GS given the prices realized I see at these venues. Of course, there are exceptions....
Successful BST Transactions: erwindoc, VTchaser, moursund, robkool, RelicKING, Herb_T, Meltdown, ElmerFusterpuck
I guess that boils down to what your time is worth and how much you want to work!
Ancient Chinese Secret 😁
Just like doing your own plumbing repairs instead of hiring the work out can leave dollars in your pocket, it depends on how much effort you want to put into selling your coins.
Another thing to consider is that some dealers do buy coins for their inventory via eBay, GC, etc. If they happen to be the buyers of your coins in those venues, are the prices you're getting after fees better than what you'd get selling directly to the dealer?
Nothing in that very hypothetical situation indicates anything about time spent. If I'm flipping wholesale at 2%, it is much LESS worth than running to shows, consigning to auction, etc for 10%.
The Great Auction Myths
Half the people think they are getting a deal at auctions because they are buying wholesale.
The other half think they are getting better money because they are bypassing dealers and selling retail.
The original poster gave two examples with 100% markups. Both are not run of the mill coins.
1811 CBH MS62 small 8
G - $1850
PCGS - $4000
1827 CBH MS63
G - $1700
PCGS - $3550
There is a lot of play in those bid and ask numbers and yes, a dealer might wholesale them or retail them depending on the dealer's business plan.
Those are not exactly bid/ask numbers as they have 2 different sources.
Liquidity and confidence. If I go to a dealer I can get my $1000 that day. If I go to eBay or GC or etc. then it might take me months to get my $1300 or I could run it at a true auction and get my money in two weeks, but I'd get between $800 and $1300 with no real way to guess who will come to auction that day.
Cash flow is king for sure and this hobby can gobble up wheel barrels full of cash!
Those numbers don’t necessarily have anything to do with “markups”.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
On that philippine peso 1904-S in 65 at $31000. . Wow what a price!
How many out there willing to pay that? usually two guys bid it up
but what was the third guy willng to pay ?
Back in the late 80's or early 90's. As I recall 3 or 4. original BU Rolls came out of the 1904-S pesos and similar of the 1903 Fifty centavos. I think before PCGS existed.
All were Gobbled up quick. I have two raw probably 64's? I wonder how many still out there raw.
like the original roll of BU 1915-S centavos (keys) that I saw/ was offered back then for $5K. I don't think they ever showed up.
probably in someones SD box.
Agreed - both numbers are guides which is why there is a lot of flexibility with actual wholesale and retail pricing. Are you able to access better price guides that narrow the spreads or are these spreads "it is what it is" and actual results depend on the negotiating skills of the two sides?
Prices from two different price guides are not the same thing as “spreads”. A spread is the difference between what someone will buy and sell for. And that depends on the seller, the coin and the market, not on listed prices from two different guides.
Another thing to keep in mind is that prices in guides are often unrealistically high or low. It’s actual transactions that count.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
This.
People should not be comparing and contrasting those two DIFFERENT guides. They may not even use the same data to generate their numbers.
CDN Exchange has bid/ask numbers. You can see the spread there. If you're a member. However, such data is really only useful for widgets since there are rarely open bids much less asks for truly scarce coins
Thanks to all for the interesting and enlightening discussion! Generally, IMO, if dealers are buying coins via eBay or other places where there is competition with collectors, they are probably not buying below sheet. As I indicated, I am sure people can come up with exceptions. But yes, one does need to consider the fees, shipping, etc. to determine what you are actually going to end up with in the end. And I do see points made by others related to uncertainty, timing, etc. I suppose for any given coin one needs to do their homework to figure out the best sell strategy.
Successful BST Transactions: erwindoc, VTchaser, moursund, robkool, RelicKING, Herb_T, Meltdown, ElmerFusterpuck
You would be surprised how often things sell below sheet even at major auction houses.
If they're buying for inventory they're not paying retail, that's for sure.