Offer to a Dealer - Resolution Reached
hbarbee
Posts: 193 ✭✭✭
I have a question especially for those of you who may have experience as a dealer, which I do not. I located a coin on line that has a TrueView available. It has great eye appeal, no CAC and I am comfortable with the grade. The offer is from a large, respected dealer who also has a B&M shop. After researching current retail prices published by all of the sources that I use, PCGS, NGC, CDN, etc. as well as recent auction results which are very consistent, a fair retail appears to be $4.5K or at most $5K. The dealer is asking $7K. I don't want to be insulting so am reluctant to make an offer since I hardly ever see such a discrepancy. Why would the asking be so high and should I pursue this?
1
Comments
I am no dealer but it would be hard to answer your question without pictures of the coin. Lots of variables.
Successful BST transactions- Bfjohnson, Collectorcoins, 1peter223, Shrub68, Byers, Greencopper, Coinlieutenant
You said that it has great eye appeal. Dealers have to pay for quality coins. The market is also hot right now. Can we see what coin you're talking about?
Early American Copper, Bust and Seated.
If there are relatively frequent appearances in auction, I’d wait and go that route.
Is there a record of this coin’s history?
If you’ve really done your homework and are confident about the stated approximate fair retail value, I’d pass, without making an offer. My thinking is that if the dealer believes his asking price is within the fair retail market value range, he’ll surely pass at even $5000 and might be insulted. At the same time, if he’s willing to sell at $5000, but has the coin listed for $7000, he sounds like a shot-taker and I wouldn’t want to give him my business, anyway.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
There are other possible explanations for the price beyond the dealer gouging or taking a shot in a hot market. The coin could be on consignment, and the dealer has simply put his markup on what the consignor wanted. I know several dealers who do that. (And sometimes they find a taker at absurd prices!)
With that large of a discrepancy between dealer ask and what im willing to pay id simply pass and not bother with an offer, its unlikely a deal could be made.
Personally, I'd call the dealer, try to have a pleasant conversation, and tactfully ask for his best price. If you're still miles apart, tell him about your research, what you were expecting to pay, and then actually listen if he explains why the price is what it is. If he doesn't want to talk, just respectfully thank him for his time and move on. On occasion, the "overpriced" coin is totally worth the asking price - but you really got to know your stuff to know when a $2-3k premium is justified on a $5k coin.
One dealer would sometimes tell me a coin was undergraded. Almost every dealer uses this line on occasion, but this guy has a proven track record. I've purchased several of these coins over the years, and wouldn't you know it - many of them did upgrade. This is a series that I'm pretty comfortable grading, so in that scenario the risk can be justified. I wouldn't do this without seeing the coin in-hand though.
This
I would never list a coin that I would take 30% less.
Of course I would also never list a $5000 coin for $7000. It's also possible the market assessment is flawed by one of the 2 players.
It sounds like you have done your research and you are too far apart. Unless you need the coin enough to come within 10% of the asking price, this is probably a pass.
LIBERTY SEATED DIMES WITH MAJOR VARIETIES CIRCULATION STRIKES (1837-1891) digital album
Different people will value coins differently. Doesn't necessarily mean either is wrong, but when there's a significant difference between them, it's going to be tough to make a deal.
Classic case of a coin being held hostage.
BHNC #248 … 130 and counting.
The Question is can you find one easily at your $5k price? If not then his price might be justify. If you don't want to pay that price then move on. Couple years ago people don't pay MSRP for car but now dealers ask for 5-10K over MSRP. If you don't want to pay for it then just move on. Complaining about over charge will not get you a car or a coin.
I think a simple phone call wouldn't hurt. Just ask him if he would be willing to negotiate the price, don't make an offer unless he says he is willing to take an offer. Otherwise you'll never know, this way you know you gave it your best shot.
Mike
My Indians
Danco Set
Any dealer ‘insulted’ by an offer is not worth dealing with and is probably a miserable person to deal with.
Nonsense. I price the coins I sell based on (in part) past sales. An offer of 50% off my listed price is an insult (although I won't tell the "buyer" that). If you're that far apart, it's probably best to buy from someone whose idea on pricing is more in line with yours.
edited to add... it's possible for either the buyer or the seller to have unreasonable expectations. Without knowing more about the coin in question, there's no way to know for sure what's really going on.
I would make the offer, the seller is putting that price for whatever reason and you making a reasonable offer based on recent sells and seems that it is fair based on your post and is not out of line. He says no and you both go on your way or he accepts or counters. No problem
Al
Appreciate the feedback. I will call and get the owner and ask, nicely, how the asking price was arrived at as per the BryceM response. I have found that when you speak to knowledgeable folks and really listen, then you often learn. I will update this post if I find out anything interesting.
So, if you look at other coins listed for sale, are they all hugely marked up as well, or is this a 1-off?
Does it fit with the other coins or is it different from the rest (ie...it is a toned coin and the don't do much with toned coins)?
Just call them up, ask if they have room and their best price. If they don't move, or don't move much, you will know. If they are more reasonable, you may have a chance.
If their best price isn't close enough for you, and you don't want to insult them, just end it with "Thanks, appreiate that. Still too far apart though as I was thinking "$xxxx" but thanks for your time."
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
It would depend on what he has in it. Typically big ticket material like the $7k piece have low margins. Any discount your eating into his margin. What makes you think he would come down thousands of dollars because you read a price guide. Perhaps he is in it a lot like if a really low pop PQ coin which puts him in the drivers seat to get all the money. All you can do is make an offer you think will take it. Most likely he may make make a counter offer or just reject yours. We are in a hot market where really PQ coins in the stratosphere get many multiples of price guides and nobody’s giving away nothin.
I don’t care for somebody quoting me price guides. What matters to me is cost plus the markup I need. He might drop it by $200 move it quick or it may be a keeper coin he is expecting get all the money. What is CPG for it?
I wonder if it’s not some really scarce coin, Super PQ, top pop he has only one being offered. Then will be tough getting him come down.
Most offers I get I usually make counter offer(S) like only let it go at say 5-10 pct off. As far as my cost in it or how price arrived is proprietary to the business. Just call him up and test the water. Who knows he may be anxious to move it and come down.
I wouldn’t buy a $5k coin based on a TrueView from a dealer who I have never done business with.
Pass. Don't bury yourself during a hot market.
Not every coin is bought by dealers at sheet prices as if eye appealing over PCGS grade value isn't uncommon.
I've had dealers tell me that they won't take coins on consignment if the owner wants an unreasonable price for his coin. The coin just takes up space in his display case and the dealer loses credibility and the respect of his customers when his ask price is unreasonable. I had one dealer that was a good friend tell me that one coin in his display case that I was interested in was a consignment coin and that it was overpriced and that I shouldn't buy it. I made an offer which he took back to the coin's owner and he accepted it. My point is it doesn't hurt to make an offer.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
I think the best approach is to have a conversation with the dealer and ask how did he gets to his asking price. That dealer knows exactly what the price guides are as well as the auction records. Whenever I was in such situation where I wanted a coin from a dealer that I thought was more than I was willing to pay, then ask. Maybe that dealer has a great explanation and may provide a worthy explanation why its price accordingly. He did his research and if you did your research, then compare them and maybe you get more educated about how he priced the coin, or if after that conversation if doesn't work, then pass on the coin. Just my 2 cents.
I think you could get a quick answer here as to whether the coin is overpriced if you would just let us all know what it is. Perhaps you don't think it's overpriced and are afraid someone here will scarf it up out from under you? Price Guides on nice, tough coins are lagging well behind the curve these days. I laugh when people throw auction results at me that are years old and might even be for an inferior coin!
You could also contact a major dealer you know who would reach out to the dealer on the coin to try to negotiate a better price.
Is it possible the dealer made a bad buy and paid too much for the coin, and now is trying to recoup his money?
USN & USAF retired 1971-1993
Successful Transactions with more than 100 Members
It never hurts to contact the seller and discuss the coin. You will learn more that way. The discussion here has given you as much as you could hope for without specifics - such as the coin pictures. Cheers, RickO
Make an offer without batting an eye. The value doesn't change because the Dealer asks too much. He either counters or passes.
Why are we all so worried about insulting a dealer? They (coin dealers) should be worried about insulting us (the customer).
It's equally possible that the dealer made a good buy and the buyer is undervaluing the coin. It's only a "bad buy" if the coin can't be sold.
It doesn't benefit either group to insult the other.
I could not agree more.
should be offended at a fair offer and if a reasonable person they would tell you why the price hike.
JMO
Jim
When a man who is honestly mistaken hears the truth, he will either quit being mistaken or cease to be honest....Abraham Lincoln
Patriotism is supporting your country all the time, and your government when it deserves it.....Mark Twain
Without more information, we don't know how the coin really should be priced. If you approach this scenario with the mindset that the dealer is dead wrong, then you run the risk that the dealer won't want to do business with you in the future. Maybe that's fine, but maybe one day there will be a better coin for which you could make a deal, but the dealer has no interest in working with you. A high price may be the dealer insulting the customer, or it may be fully justified and the OP just doesn't know it. Or it could just be a case where you have to agree to disagree. Even if you can't come to a resolution, how you carry yourself carries a lot of weight for any future relationship.
No one, for ANY reason, is "fully justified" in insulting someone that they don't know whether in numismatics or some other scenario. If someone thinks they are, it says more about them than the person they are insulting.
Sometimes you can find the auction results for the specific coin being offered. If that coin sold for $6000, then asking $7000, being prepared to accept $6500 isn't unreasonable. If it sold for $4500, then asking for $7000 is fishing for an impulse buyer in a hot market, which is not an entirely unreasonable thing to try. Either way, however, $5000 isn't going to get you the coin. A professional dealer will understand your offer and perhaps explain why it won't work. With most dealers, however, it'll either get you ignored with prejudice or lectured. Best to look for a coin more consistent with your research.
Keeper of the VAM Catalog • Professional Coin Imaging • Prime Number Set • World Coins in Early America • British Trade Dollars • Variety Attribution
Quote from the OP ......
" It has great eye appeal"
Wait until buyers start to see what the Fairmont gold gets listed at when Dealers start making some of them available. Great coins do not sell for guide or auction prices of lesser coins. It is very common for a dealer to add 10-15% to the price they paid at auction. If the coin in question has "great eye appeal" then maybe the price is right.
Successful BST with drddm, BustDMs, Pnies20, lkeigwin, pursuitofliberty, Bullsitter, felinfoel, SPalladino
$5 Type Set https://www.pcgs.com/setregistry/u-s-coins/type-sets/half-eagle-type-set-circulation-strikes-1795-1929/album/344192
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
How hard is it to find another?
I do appreciate the discussion on this. I have been down this road before and in those cases after contacting the dealer, I better understood the coin and usually got a price closer to what I figured it should be. However in this case the difference was so large that I though I would get your opinions before going further.
If you really like the coin, an offer of 10% less ($6300) would get the dealers attention.
My question for you is, considering the great eye appeal, would you rather have a boring normal coin for $5000 or a coin you would be proud of for $6300?
Only you can answer that question.
Wow. I'm guessing this is one outstanding example, if he's asking a 40% premium. I've paid way higher premiums for top shelf coins. Sometimes it's worth it, at least to me.
As far as the offer goes, I'd have no problems asking. I don't see it as insulting at all. Offering $2500 might be insulting, but not 5K.
Good luck,
Dave
I don't know about others, but as a seller, I wouldn't be buying at $4500 if that's a reasonable (however you define it) retail value with the hopes of finding a buyer at $7000. Seems like a good way to build up an inventory of coins that are not profitable to resell. On the other hand, if I saw something in the coin that I believed warrants a $7000 price tag, I'd certainly consider buying it for $4500.
But then, that's just me.
"Fully justified" is referring to the price not an insult.
I think the difference between $7 and $5 thousand is too great to make a deal. Usually you are looking at a 10% price cut at most.
I just got done passing on coin for a lot less money. The PCGS price guide was $215 with auction results coming in at less than $200. The dealer's price was $275. I liked the coin, and offered him the $215. He passed and came back with an offer of $250 with a reminder that he was paying the postage. I offered to pay the postage with a $230 offer. He passed. End of the negotiations.
There's nothing wrong in contacting the dealer and saying something definitive like this........"I'm a definite buyer at a price of $5000.00. Please let me know if you will accept my offer"
No harm, no foul.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
Two different types of insults. If I offer a dealer a fraction of what a coin is worth, he may be insulted and think I'm wasting his time. Same if he quotes me multiples of what a coin is worth and I think he's wasting my time.
If I call a dealer an fat, ugly slob, that is also an insult and makes me a pretty terrible person. It's not remotely the same as a time-wasting insult. One is unjustified in the course of being a good person. One is simply ill-advised if you want access to a dealer's inventory and general good will.
I located a coin on line that has a TrueView available. It has great eye appeal, no CAC and I am comfortable with the grade. The offer is from a large, respected dealer who also has a B&M shop. After researching current retail prices published by all of the sources that I use, PCGS, NGC, CDN, etc. as well as recent auction results which are very consistent, a fair retail appears to be $4.5K or at most $5K. The dealer is asking $7K.
I understand you can't let us know which coin this is. But, why do you want to buy it as opposed to another coin?
I don't like the fact that it's a premium price coin without a CAC. Is it the specific date/mintmark or grade? Could another coin be just as satisfactory? Is it actually an undervalued coin that you have discovered in spite of the price guides? Top pop? And finally, is it returnable?
This is the way I see it: It is up to the owner of the coin to set the price. If you don't want to pay that price, and if the owner won't accept your offer, then don't buy it.
The answer will be "no" until you make the offer. After you make the offer, the answer might still be "no", but it could also be "yes."
Ron Guth, Chief Investigator
The Numismatic Detective Agency