What makes someone a dealer?

RLinn

I don't mean define dealer. I'm just curious how those who consider themselves dealers (even if you are part time or half-hearted about it) reach the decision to be one. Were you influenced by another dealer?

I spent three months thinking I wanted to be a vest pocket type dealer in the late 60s and quickly found out I really just loved collecting and the people and have sold very few of my coins since then. Dealing wasn't for me but I'm glad it is a good fit for others.

CarlWohlforth

I started selling off my duplicates and coins no longer my main focus. I enjoyed making deals and truly enjoyed exchanging emails with other coin collectors. Then when I ran low on extras I offered to sell coins on eBay for other people. Now I get to see more coins and do more deals.

It is a very small, part time business. But I learn something from each coin that passes through my hands. I also have made some friends and hope to make more. So even though I don't make hardly any money the rewards are there for me.

supercoin

Temporary (or lasting) insanity.

RLinn

<< <i>Temporary (or lasting) insanity. >>


LOL This also leads to finding things in a collection that you never knew you had or why.

Clankeye

"What makes someone a dealer?".....


If they have more coins than are truly neccessary for their personal, recreational useage.

Russ

<< <i>Temporary (or lasting) insanity. >>



That condition is not specific to coin dealers, it is a necessary attribute in all small business owners.

I think that there would be two criteria that define a dealer. a) sells coins regularly, and b) makes a profit at it.

Russ, NCNE

RLinn

<< <i>I think that there would be two criteria that define a dealer. a) sells coins regularly, and b) makes a profit at it. >>



Russ, maybe your criteria "B" is simply a qualifier to differentiate "successful" dealers from "former" or "soon to be former" dealers.

coinnerd

<< <i>If they have more coins than are truly neccessary for their personal, recreational useage. >>



I didn't know that was possible.

DanC

Collector - one who buys and sells with the *intent* of gathering a collection

Dealer - one who buys and sells with the *intent* of making a profit, as a business enterprise.

just my 2cents...

supercoin

I think that there would be two criteria that define a dealer. a) sells coins regularly, and b) makes a profit at it.

Cool, I'm halfway there!!!

More seriously... I got into coin dealing a few years back after being sorely disappointed with the state of online stores back then. Virtually no photos, horrible user interface design, terribly outdated inventory lists, no way to purchase directly online. And of course the usual litany of complaints about mail-order service in general.

So, I thought to myself, I can do better than that. I'll have photos, shopping carts, real-time inventory updates. If you see a coin listed as available, you can reserve it in a flash, pay for it instantly with a credit card, and have it show up on your doorstep in just a few days.

Coins, I thought, would make an ideal mail-order item. Small, compact, and valuable. Easily mailed, with shipping costs being a small portion of the retail price.

Originally I hoped to be a middleman... taking in coins, photographing them, and reselling them. Sort of a kinder gentler Teletrade with fixed prices. I wouldn't have to have my own money tied up in inventory. That didn't work out for a number of reasons, so I just started buying coins myself and reselling them.

Long story short... I accomplished most of my goals. I did create a much better product/service than what was available. Unfortunately, my goals were not listed in the right order. My #1 goal should have been to create something that had the potential to make a pile of money, rather than simply build a better mousetrap. This is a common mistake when engineers/designers start companies, as opposed to businessmen.

There are (at least) two huge problems with the coin business -- laughably low markups compared to other industries, and the inability to effectively leverage success. It is very labor-intensive, both in buying and selling, and the only way to buy and sell more is to add more labor. Contrast that to selling widgets... all widgets are identical, you describe and list them for sale once, and if they sell well you simply order another 1000 of them. And make 100% markups on each one instead of 10% markups.

If I were forced to do it again, I would concentrate on low-volume high-priced (and higher margin) coins. That is one way to leverage your labor, i.e. it doesn't take much more work to buy/sell expensive coins than cheap coins. But of course the risks are much higher with thinly traded expensive coins as well.

Another way it may make sense is as a part-time endeavour, where you are not counting on the income. You then have the luxury of waiting for good deals to fall into your lap, rather than trying to "force" a living out of the market.

But in general, for anyone considering coin dealing, I would encourage them to really examine what their motivations are for doing so. And don't do it for the money.

gsaguy

Some might say that coin collecting is a form of temporary insanity quickly cured by dealing.

I say that because many dealers claim that once they started dealing, they no longer felt compelled to collect and began to look at their collections differently. Many even claim they sold their collections and no longer collect.

I've been fortunate. Due to circumstance, I can deal coins because I enjoy traveling, meeting new people, and COINS.....in other words, I'm not doing it solely because of a profit motive. Dealing coins has put me in touch with some collectors who have some awesome collections and, of course, I hope to some day have a shot at those collections. While I still focus on adding select pieces to my collection, I'm also learning a lot about other series as I help collectors find coins for their collections. In a short period of time I've handled and 'placed' some really nice pieces.

Thanks, good post RLinn!

GSAGUY

ARCO

the ability to sell cleaned, problematic and overgraded coins with straight face!

supercoin

Heh, good point ARCO. My post relates to being an honest coin dealer. I think one of the reasons you see so much crookedness in coin dealing is that it is an extremely tough business to be successful in, so if an opportunity to make some money unethically comes up, it's very tempting. And, coin dealers in general are a rather hated profession, so it can be easy to become jaded and allow yourself to feel justified sticking it to someone who thinks you're a crook anyway.

My pet theory for the root of much of the corruption is the "investment" lie that somebody made up years ago to justify selling (as a dealer) or buying (as a collector to a spouse) little chunks of metal for absurd prices. This deception has resulted in compounded lies and dishonesty ever since. But that's another topic.

steventheyn

I think that dealers who sell cleaned problematic and overgraded coins with a straight face make big profits at first, but in the long run the honost and ethical dealers will always come out ahead. So I salute those honost dealers out there who are struggling at first but in the long run, they will always win out.

Now to answer the original question, I think a dealer is someone who sometime in their life sells a coin. So, by my definition, I'm a dealer.

dorkkarl

followup question:

is there a difference between "dealers" and "brokers"? i consider a dealer to be anyone who buys coins with the specific intent to sell them for a profit. but some advertisers in coin-world specifically call themselves brokers.

what's the diff?

K S