@pruebas said:
I would let the dealer run their business as s/he sees fit. I’m sure there is a reason for their action, even if it’s as simple as not being able to replace inventory and needing something to do to keep busy.
This.
We're very small sellers on E-Bay. We usually have 10-20 coins up at any one time.
We had a great 6 weeks from mid April to mid June. The last month nothing. We have a number coins listed that have been on for months. I consider it stale inventory.
As was said, if I wanted to move the coins, I lower the price until they sell.
Here is my thinking. The store costs $20/ month. That's our overhead. Let's say I list a coin for $3000 and it sits. I could in theory lower the price to $2700 and it probably will move. I pay E-Bay $250 and would net $2450. I scour the marketplace and I decide that I would love to buy the coin I'm offering at $2450. Does lowering the price make sense? In fact, if the same grade came available at $2450, I would buy another.
Reasons for us to sell:
1)Bought too much inventory and need to move dollars.
2)Unhappy with the coin we bought,
3)We upgraded, and now wish to move the lower grade.
Otherwise, stale inventory is ok since we aren't offering coins to meet living expenses.
With that said, we will delist coins when we sense no one is interested in them and fill in with new coins.
Lately, we haven't found much new interesting inventory that meets our price point so we go with stale.
OK. Fine. But when I hear "dealer", I think of someone running a business, not trying to generate a little cash out of a hobby.
If you're trying to make a living paying $2450 for coins that you could only net $2450 on, then I'd call you, at the very best, a bad businessman, If you're instead offering the $2450 coin at a higher price with no real expectation that you'll get that price but would rather keep the coin for what you could get for it, then I won't say you're doing it wrong, but would question you calling yourself a dealer.
IMO, a dealer would, after paying $2450 for a coin and not being able to get a gross sale of $3000, instead take a net of $2450, or even $2300 or $2200, learn his lesson, and move on to another coin or coins that could earn back the difference and then some.
Anyone who does otherwise, and on purpose, is a collector who pretends to be a dealer because he thinks it enables him to buy at wholesale. There is nothing wrong with showing off your coins with prices that no one or only the seriously uninformed would pay, but don't pretend you're running a business.
But that's the thing, many (most?) Dealers are amateurs, even at local coin shows.
I believe it all boils down to Daltex's point that Amateurs aren't dealers? They use the hobby to get some cash out.
moving on... no one is defining the word stale? One month, six moths, twelve months in inventory?
He's not considering the metal content in his example. When paying $2450 for a coin with a $1900 metal content, the coin becomes more valuable as the price move to spot. It's becoming a gold proxy, His point is that dealers should sell "bad" inventory to buy better inventory. That assumes you don't have add'l funds to buy more inventory or a desire to increase the size of the inventory? Makes sense, if one can buy better inventory than what you currently own. Otherwise, you might as well keep what you have? Sometimes you decide a coin is a buy at $2450/net but a sale at $3000 gross ($2750/net). Should you sell @ $2500, $2400, $2300)? Depends on what you can do with the cash?
Funny thing about E-Bay. We have all gone through droughts with stale inventory and then mysteriously get hot. Why? If you are still selling after a long enough time... you might not be as uninformed as some believe?
In addition, what is running a business? I thought .. buying, selling keeping records, reporting taxes qualifies but in the end we're back to the discussion that only full time sellers are dealers.
You know I don’t like the word stale. Slow moving may be a more appropriate term.
If somebody taking a table at shows and or operating online store plus filing sch c they are without doubt a dealer. They may be retired from something else or have a job somewhere.
Dont let some poster off a blog define you. Get some nice biz cards printed especially with a coin photo have at your table at shows plus for online buyers (if you want to). Who knows you might get a call about an estate deal. Have fun.
Your first show they may be over there pick you off (newbie) with their BS. Just push back - “Well bid is x $” they will say. Just say “ do you have one sell me at that? Or “so what that’s wholesale.” Or a tirekicker / cheapo will try low ball you. Stand your ground or make a counter offer that works for you. When their BS starts it’s time for them to leave. My first show shared a table with a friend who had done numerous shows. Really helped. A vest pocket trader friend helped me get some pickups - yes he got his cut but got me some nice stuff with a little profit room for me to put in my show case. Ditto for guy who worked at huge shop in another city with box of slabs to go thru (flip dealer to dealer).
In addition, what is running a business? I thought .. buying, selling keeping records, reporting taxes qualifies but in the end we're back to the discussion that only full time sellers are dealers.
No more than buying and selling stocks occasionally makes one an investment professional. And it makes a huge difference. You can't just say "I define myself as a dealer, so I'll file my taxes that way." There are certain rules that must be followed, and I'm not sure what they are because I don't have to be. I never wondered if I could file my taxes as a coin dealer.
I just don't understand how someone eats if they are trying to make a living dealing coins, but just don't turn inventory over. I don't understand how someone can survive, as a business, if their entire inventory is 100 ounces of gold, and instead of turning it over at whatever a current fair value is, needs to wait for god to go up $100 or $200 to sell. I mean we all have expenses, and if we've got all our assets tied up in coins we can't sell, how do we meet expenses?
@alefzero said:
SO what do you tell that large fraction of the dealer community? Get out of the business?
They need to learn the market better so they can buy future coins at more appropriate prices. Once they take the loss on the first batch of coins, hopefully they won’t make the same mistake again.
Sitting and dwelling on a few hundred to few thousand dollar loss on coins is wasting time and future buying opportunities. Cut the losses and move on to better deals.
You are thinking too much about "dealers" as actual businesses. The collectibles markets, including coins, are full of amateurs and part timers that aren't really trying to make money. They like the coins and would rather keep them than sell them cheaply.
I've often thought that the best dealers are the people that care least about what they are dealing. It is easier to make business decisions and not collector decisions.
Exactly right about caring least about what you’re actually selling. Shouldn’t be any emotional attachment to the coin, just price it to sell and get it gone. Those are the dealers who are easy to buy from and are “normal”.
Guess I didn’t look at it where these sellers of the same old stuff are just doing it for “fun” or for something to do. Kinda makes me respect them less because they are just wasting everyone’s time. I’m struggling wrapping my mind around the idea of someone repeatedly buying a $500-$1000 table at a show, just to show off their stale coins and not sell them.
In addition, what is running a business? I thought .. buying, selling keeping records, reporting taxes qualifies but in the end we're back to the discussion that only full time sellers are dealers.
No more than buying and selling stocks occasionally makes one an investment professional. And it makes a huge difference. You can't just say "I define myself as a dealer, so I'll file my taxes that way." There are certain rules that must be followed, and I'm not sure what they are because I don't have to be. I never wondered if I could file my taxes as a coin dealer.
I just don't understand how someone eats if they are trying to make a living dealing coins, but just don't turn inventory over. I don't understand how someone can survive, as a business, if their entire inventory is 100 ounces of gold, and instead of turning it over at whatever a current fair value is, needs to wait for god to go up $100 or $200 to sell. I mean we all have expenses, and if we've got all our assets tied up in coins we can't sell, how do we meet expenses?
Back to definitions?
I assume a "dealer can be full time or part time? A dealer can have employees or not. A dealer can borrow money to finance their inventory or not. A dealer could have 7 figure inventories or not. In truth, I judge that if your inventory isn't 7 figures without loans you're a hobbyist. LOL. A dealer could turn their inventory often or not. The primary difference between a hobby and a business in the United States, according to the IRS, is that a business actively tries to earn a profit while a hobby does not. I'm not sure what we are discussing other than how you classify your definitions. What if I take tables at coin shows and sell $100,000 worth of coins a year? Do I still get a dealers table? On E-Bay there are no tables. Does it really mean that much to you? I always assumed, if you buy coins with the goal to sell them you are a dealer. However, similar going to Casablanca for the waters, I might be mistaken?
I trade commodities. I trade maybe 50 contracts/year. Does the number preclude me from calling myself a commodities trader if I wish? Am I a commodities investor? Am i trying to extract a few dollars from a hobby? I might be a pretend commodities trader?
These day's I am down to making 5000-10000 stock trades/year. My sister maintains I'm a gambler. After 40 years my wife doesn't care what I do as long as the bills are paid. Low threshold. I have never worked for a firm, never borrowed money, always filed my taxes as a trader, made an OK living. Does that make me a "professional any more than if someone traded 100 stocks/year? they didn't move the 100 stocks often, I might call them a poor traders but I don't judge. Some people have part time businesses. Can they still be traders? When people have asked me what I do, for the past 40 yrs, I'm now going to say Stock professional. IN the past, I used to say retired.
You are free to believe what you wish. This conversation will not help me make any money, thus so I will leave it here.
Having a bad show is no fun. When that happens to me I want to keep it to myself. Keep my game face / get back up from the fall. Frankly I would be embarrassed somebody could tell my inventory not moving.
Inventory can be slow moving for a
number of reasons: price, market conditions, people coming in bourse room broke / won’t pay the money, or there is simply no one attending who is interested in it. A 2 x 3 ft display case can hold 6 layers of slabs 80 per level. Cheap slabs can be stacked. I prefer put the best one on top of the stack.
In a slow moving situation one could drop prices on some items to test the atmosphere. Price stickers in red (items considerably reduced) as the canary in the cage. Rearranging the display another strategy. Perhaps a junk box - items $1-$20 that fits inside the showcase (binder pages of 2x2’s work for me).
I would define stale as coins that sit longer than 4-6 months. Basically every other major show in the same location (i.e. if you have a coin at the February Long Beach show, it better be gone by the end of September Long Beach show). You have time to run the nation show circuit cycle in this time and find the buyer (if they exist). If you can’t find the buyer in this timeframe, what you’re selling is way overpriced or junk nobody wants.
@alefzero said:
SO what do you tell that large fraction of the dealer community? Get out of the business?
They need to learn the market better so they can buy future coins at more appropriate prices. Once they take the loss on the first batch of coins, hopefully they won’t make the same mistake again.
Sitting and dwelling on a few hundred to few thousand dollar loss on coins is wasting time and future buying opportunities. Cut the losses and move on to better deals.
You are thinking too much about "dealers" as actual businesses. The collectibles markets, including coins, are full of amateurs and part timers that aren't really trying to make money. They like the coins and would rather keep them than sell them cheaply.
I've often thought that the best dealers are the people that care least about what they are dealing. It is easier to make business decisions and not collector decisions.
Exactly right about caring least about what you’re actually selling. Shouldn’t be any emotional attachment to the coin, just price it to sell and get it gone. Those are the dealers who are easy to buy from and are “normal”.
Guess I didn’t look at it where these sellers of the same old stuff are just doing it for “fun” or for something to do. Kinda makes me respect them less because they are just wasting everyone’s time. I’m struggling wrapping my mind around the idea of someone repeatedly buying a $500-$1000 table at a show, just to show off their stale coins and not sell them.
They don't usually set up at the big shows. Most local shows are more like $100. And for $100 you get to have fun for the weekend. You also get early bird access to the other dealer inventories and you might actually buy something across the table. There are worse ways to spend $100 for entertainment. [Personally, I hate setting up at coin shows. LOL. It's exhausting.]
Full market on those pci coins would entail getting them into NGC or pcgs plastic to get accurate grades, then probably put them back in your case 1-2 more times and if they don’t sell, send to an auction house.
Pcgs price guide on the 1903 proof Morgan 67 cameo is $25,500. The owner can lose the cameo status and a few grade points, and still should be ok money wise selling. If it comes back questionable color, that falls on the dealer for not knowing what they’re buying.
The word "dealer" gets thrown around and generalized about a lot on these boards. I define a dealer as someone who derives most or all their income from numismatics. If you keep seeing someone with a lot of the same stuff you saw the last several times and he's an actual dealer as I define it, then those are just case fillers and he's making his money with other items. They could also be consigned pieces where the sale prices factor in his cut for doing the deal. And yes, some guys occasionally get stubborn and won't take less than $x for something for any number of reasons. That doesn't necessarily make them bad businessmen. Now, if the guy with the same unchanging stuff is just sitting there and not doing anything, then he isn't a real dealer; he's just a hobbyist who won't sell unless he gets the number he wants. I've known a few of those and you'll see them quite often at your local club show.
All of that said...just because you don't want to pay $x for something doesn't necessarily mean that it's overpriced or that only a stupid person would pay $X for it. It also doesn't mean that someone is obligated to sell something at a breakeven or loss just because YOU think they should.
I'm not a dealer but is it possible that some dealers biz model is to sell fewer coins at higher margins and other dealers work on lower margins but higher volume?
Possibly so. Depends on how one defines high vs low margin. Low markup over cost 5-10%, Mid range 20-35%, Fifty Nifty 50%, Double Bubble / Keystone - 100%. It can depend on the inventory class / item cost.
Generally high cost / expensive items could have lower markup factor (MUF).
Or it could be seat of pants all in the rip (SOP): Jim after doing some trawling picks up early 20th century MS65 low or top pop (single digit) PCGS world silver coin for $34 off auc. 2 Other eBay sellers have it for $125-$150. Pricing data scant on these. Going for the jugular - He lists his in online store at $95 - About TD (tripple dipple).
@telephoto1 said:
The word "dealer" gets thrown around and generalized about a lot on these boards. I define a dealer as someone who derives most or all their income from numismatics. If you keep seeing someone with a lot of the same stuff you saw the last several times and he's an actual dealer as I define it, then those are just case fillers and he's making his money with other items. They could also be consigned pieces where the sale prices factor in his cut for doing the deal. And yes, some guys occasionally get stubborn and won't take less than $x for something for any number of reasons. That doesn't necessarily make them bad businessmen. Now, if the guy with the same unchanging stuff is just sitting there and not doing anything, then he isn't a real dealer; he's just a hobbyist who won't sell unless he gets the number he wants. I've known a few of those and you'll see them quite often at your local club show.
All of that said...just because you don't want to pay $x for something doesn't necessarily mean that it's overpriced or that only a stupid person would pay $X for it. It also doesn't mean that someone is obligated to sell something at a breakeven or loss just because YOU think they should.
A lot of full- time BM dealers make 90% of their money on bullion. So "stale" retail coins don't even register for them.
A lot of full- time BM dealers make 90% of their money on bullion. So "stale" retail coins don't even register for them.
Precisely. Or dollar specialists move mostly dollars and the type sits there, type guys move type and moderns sit there, Etc. There are any number of reasons why you might see some repeat coins occasionally. Some guys (myself included) have a system when setting up display cases where certain areas are designated for specific things, if for no other reason than to make them easier to locate when busy. Dollars here, gold there, commems over here, etc.... although we obviously rotate stock just as any other business would. That said, what some view as stale inventory can also stem from not paying attention to exactly what was there last time.
@tyler267 said:
I'm not a dealer but is it possible that some dealers biz model is to sell fewer coins at higher margins and other dealers work on lower margins but higher volume?
I usually sell at a loss, but I make up for it in volume.
@1madman said:
Full market on those pci coins would entail getting them into NGC or pcgs plastic to get accurate grades, then probably put them back in your case 1-2 more times and if they don’t sell, send to an auction house.
Pcgs price guide on the 1903 proof Morgan 67 cameo is $25,500. The owner can lose the cameo status and a few grade points, and still should be ok money wise selling. If it comes back questionable color, that falls on the dealer for not knowing what they’re buying.
The 1897 next to it in the picture looks cleaned.
One option would be to send to PCGS in holders and "cross at any ms numerical grade". The crossover specialists are not biased as far as I've seen and want good coins in their plastic.
Comments
But that's the thing, many (most?) Dealers are amateurs, even at local coin shows.
I believe it all boils down to Daltex's point that Amateurs aren't dealers? They use the hobby to get some cash out.
moving on... no one is defining the word stale? One month, six moths, twelve months in inventory?
He's not considering the metal content in his example. When paying $2450 for a coin with a $1900 metal content, the coin becomes more valuable as the price move to spot. It's becoming a gold proxy, His point is that dealers should sell "bad" inventory to buy better inventory. That assumes you don't have add'l funds to buy more inventory or a desire to increase the size of the inventory? Makes sense, if one can buy better inventory than what you currently own. Otherwise, you might as well keep what you have? Sometimes you decide a coin is a buy at $2450/net but a sale at $3000 gross ($2750/net). Should you sell @ $2500, $2400, $2300)? Depends on what you can do with the cash?
Funny thing about E-Bay. We have all gone through droughts with stale inventory and then mysteriously get hot. Why? If you are still selling after a long enough time... you might not be as uninformed as some believe?
In addition, what is running a business? I thought .. buying, selling keeping records, reporting taxes qualifies but in the end we're back to the discussion that only full time sellers are dealers.
You know I don’t like the word stale. Slow moving may be a more appropriate term.
If somebody taking a table at shows and or operating online store plus filing sch c they are without doubt a dealer. They may be retired from something else or have a job somewhere.
Dont let some poster off a blog define you. Get some nice biz cards printed especially with a coin photo have at your table at shows plus for online buyers (if you want to). Who knows you might get a call about an estate deal. Have fun.
Your first show they may be over there pick you off (newbie) with their BS. Just push back - “Well bid is x $” they will say. Just say “ do you have one sell me at that? Or “so what that’s wholesale.” Or a tirekicker / cheapo will try low ball you. Stand your ground or make a counter offer that works for you. When their BS starts it’s time for them to leave. My first show shared a table with a friend who had done numerous shows. Really helped. A vest pocket trader friend helped me get some pickups - yes he got his cut but got me some nice stuff with a little profit room for me to put in my show case. Ditto for guy who worked at huge shop in another city with box of slabs to go thru (flip dealer to dealer).
No more than buying and selling stocks occasionally makes one an investment professional. And it makes a huge difference. You can't just say "I define myself as a dealer, so I'll file my taxes that way." There are certain rules that must be followed, and I'm not sure what they are because I don't have to be. I never wondered if I could file my taxes as a coin dealer.
I just don't understand how someone eats if they are trying to make a living dealing coins, but just don't turn inventory over. I don't understand how someone can survive, as a business, if their entire inventory is 100 ounces of gold, and instead of turning it over at whatever a current fair value is, needs to wait for god to go up $100 or $200 to sell. I mean we all have expenses, and if we've got all our assets tied up in coins we can't sell, how do we meet expenses?
Exactly right about caring least about what you’re actually selling. Shouldn’t be any emotional attachment to the coin, just price it to sell and get it gone. Those are the dealers who are easy to buy from and are “normal”.
Guess I didn’t look at it where these sellers of the same old stuff are just doing it for “fun” or for something to do. Kinda makes me respect them less because they are just wasting everyone’s time. I’m struggling wrapping my mind around the idea of someone repeatedly buying a $500-$1000 table at a show, just to show off their stale coins and not sell them.
Back to definitions?
I assume a "dealer can be full time or part time? A dealer can have employees or not. A dealer can borrow money to finance their inventory or not. A dealer could have 7 figure inventories or not. In truth, I judge that if your inventory isn't 7 figures without loans you're a hobbyist. LOL. A dealer could turn their inventory often or not. The primary difference between a hobby and a business in the United States, according to the IRS, is that a business actively tries to earn a profit while a hobby does not. I'm not sure what we are discussing other than how you classify your definitions. What if I take tables at coin shows and sell $100,000 worth of coins a year? Do I still get a dealers table? On E-Bay there are no tables. Does it really mean that much to you? I always assumed, if you buy coins with the goal to sell them you are a dealer. However, similar going to Casablanca for the waters, I might be mistaken?
I trade commodities. I trade maybe 50 contracts/year. Does the number preclude me from calling myself a commodities trader if I wish? Am I a commodities investor? Am i trying to extract a few dollars from a hobby? I might be a pretend commodities trader?
These day's I am down to making 5000-10000 stock trades/year. My sister maintains I'm a gambler. After 40 years my wife doesn't care what I do as long as the bills are paid. Low threshold. I have never worked for a firm, never borrowed money, always filed my taxes as a trader, made an OK living. Does that make me a "professional any more than if someone traded 100 stocks/year? they didn't move the 100 stocks often, I might call them a poor traders but I don't judge. Some people have part time businesses. Can they still be traders? When people have asked me what I do, for the past 40 yrs, I'm now going to say Stock professional. IN the past, I used to say retired.
You are free to believe what you wish. This conversation will not help me make any money, thus so I will leave it here.
Having a bad show is no fun. When that happens to me I want to keep it to myself. Keep my game face / get back up from the fall. Frankly I would be embarrassed somebody could tell my inventory not moving.
Inventory can be slow moving for a
number of reasons: price, market conditions, people coming in bourse room broke / won’t pay the money, or there is simply no one attending who is interested in it. A 2 x 3 ft display case can hold 6 layers of slabs 80 per level. Cheap slabs can be stacked. I prefer put the best one on top of the stack.
In a slow moving situation one could drop prices on some items to test the atmosphere. Price stickers in red (items considerably reduced) as the canary in the cage. Rearranging the display another strategy. Perhaps a junk box - items $1-$20 that fits inside the showcase (binder pages of 2x2’s work for me).
I would define stale as coins that sit longer than 4-6 months. Basically every other major show in the same location (i.e. if you have a coin at the February Long Beach show, it better be gone by the end of September Long Beach show). You have time to run the nation show circuit cycle in this time and find the buyer (if they exist). If you can’t find the buyer in this timeframe, what you’re selling is way overpriced or junk nobody wants.
They don't usually set up at the big shows. Most local shows are more like $100. And for $100 you get to have fun for the weekend. You also get early bird access to the other dealer inventories and you might actually buy something across the table. There are worse ways to spend $100 for entertainment. [Personally, I hate setting up at coin shows. LOL. It's exhausting.]
What would a good exit path for a dealer looking to get full market be for these coins shared on a recent FUN show thread?
Full market on those pci coins would entail getting them into NGC or pcgs plastic to get accurate grades, then probably put them back in your case 1-2 more times and if they don’t sell, send to an auction house.
Pcgs price guide on the 1903 proof Morgan 67 cameo is $25,500. The owner can lose the cameo status and a few grade points, and still should be ok money wise selling. If it comes back questionable color, that falls on the dealer for not knowing what they’re buying.
The 1897 next to it in the picture looks cleaned.
The word "dealer" gets thrown around and generalized about a lot on these boards. I define a dealer as someone who derives most or all their income from numismatics. If you keep seeing someone with a lot of the same stuff you saw the last several times and he's an actual dealer as I define it, then those are just case fillers and he's making his money with other items. They could also be consigned pieces where the sale prices factor in his cut for doing the deal. And yes, some guys occasionally get stubborn and won't take less than $x for something for any number of reasons. That doesn't necessarily make them bad businessmen. Now, if the guy with the same unchanging stuff is just sitting there and not doing anything, then he isn't a real dealer; he's just a hobbyist who won't sell unless he gets the number he wants. I've known a few of those and you'll see them quite often at your local club show.
All of that said...just because you don't want to pay $x for something doesn't necessarily mean that it's overpriced or that only a stupid person would pay $X for it. It also doesn't mean that someone is obligated to sell something at a breakeven or loss just because YOU think they should.
RIP Mom- 1932-2012
I'm not a dealer but is it possible that some dealers biz model is to sell fewer coins at higher margins and other dealers work on lower margins but higher volume?
Possibly so. Depends on how one defines high vs low margin. Low markup over cost 5-10%, Mid range 20-35%, Fifty Nifty 50%, Double Bubble / Keystone - 100%. It can depend on the inventory class / item cost.
Generally high cost / expensive items could have lower markup factor (MUF).
Or it could be seat of pants all in the rip (SOP): Jim after doing some trawling picks up early 20th century MS65 low or top pop (single digit) PCGS world silver coin for $34 off auc. 2 Other eBay sellers have it for $125-$150. Pricing data scant on these. Going for the jugular - He lists his in online store at $95 - About TD (tripple dipple).
A lot of full- time BM dealers make 90% of their money on bullion. So "stale" retail coins don't even register for them.
Precisely. Or dollar specialists move mostly dollars and the type sits there, type guys move type and moderns sit there, Etc. There are any number of reasons why you might see some repeat coins occasionally. Some guys (myself included) have a system when setting up display cases where certain areas are designated for specific things, if for no other reason than to make them easier to locate when busy. Dollars here, gold there, commems over here, etc.... although we obviously rotate stock just as any other business would. That said, what some view as stale inventory can also stem from not paying attention to exactly what was there last time.
RIP Mom- 1932-2012
I usually sell at a loss, but I make up for it in volume.
Philippians 4:4-7
trade, trade, trade
One option would be to send to PCGS in holders and "cross at any ms numerical grade". The crossover specialists are not biased as far as I've seen and want good coins in their plastic.