Some thoughts on the Michigan State Show
291fifth
Posts: 25,080 ✭✭✭✭✭
I attended the Michigan State Show on Saturday and Sunday. Unfortunately, I wasn't able to find any of the forum members. In any case, here are some of my comments on the show:
1. The market is very solid but I would still not classify it as "hot". (I was there to sell. I didn't buy anything but a Christmas round for my sister.)
2. Many dealers still seem to be out-of-touch with the way eBay has affected the coin market. In the past sellers were at the mercy of the dealers. With eBay that is no longer the case. I offered some very prime Indian and Lincoln cents to one of the dealers, my goal was to raise a specific dollar amount and I was going to let the market decide just what would be sold. I had no intention of selling everything. I told the dealer I wanted him to make offers. He did so only with the greatest of reluctance (much to my annoyance). As soon as I had reached my dollar sales goal I cut off the transaction. I didn't even let him see the third box of coins, a fact that I later learned annoyed him. Since he had skirted my rule about him making the offer I really just wanted to get my cash and leave. Many of the coins I had with me will be on eBay in the next few months.
3. I offered 3 ANACS certified Indian cents to one of the high-end dealers at the show. I again wanted him to make the offer. One of the coins was a C-N 1863 Indian in MS64, very nice for the grade, the next coin was an 1880 in MS65RED, unusually red for such an early date and the last coin was a 1906 which had been purchased from Richard Snow in MS65RED, solid in the grade. The dealer made a modest offer for the 1863 and declined to offer on the others because he didn't feel he could get them to cross. I declined his offer on the 1863 stating that I was I was sure I could do better on eBay. If he was expecting me to suddenly quote him a low price in desperation he was wrong. All three coins will be offered on eBay in the near future.
1. The market is very solid but I would still not classify it as "hot". (I was there to sell. I didn't buy anything but a Christmas round for my sister.)
2. Many dealers still seem to be out-of-touch with the way eBay has affected the coin market. In the past sellers were at the mercy of the dealers. With eBay that is no longer the case. I offered some very prime Indian and Lincoln cents to one of the dealers, my goal was to raise a specific dollar amount and I was going to let the market decide just what would be sold. I had no intention of selling everything. I told the dealer I wanted him to make offers. He did so only with the greatest of reluctance (much to my annoyance). As soon as I had reached my dollar sales goal I cut off the transaction. I didn't even let him see the third box of coins, a fact that I later learned annoyed him. Since he had skirted my rule about him making the offer I really just wanted to get my cash and leave. Many of the coins I had with me will be on eBay in the next few months.
3. I offered 3 ANACS certified Indian cents to one of the high-end dealers at the show. I again wanted him to make the offer. One of the coins was a C-N 1863 Indian in MS64, very nice for the grade, the next coin was an 1880 in MS65RED, unusually red for such an early date and the last coin was a 1906 which had been purchased from Richard Snow in MS65RED, solid in the grade. The dealer made a modest offer for the 1863 and declined to offer on the others because he didn't feel he could get them to cross. I declined his offer on the 1863 stating that I was I was sure I could do better on eBay. If he was expecting me to suddenly quote him a low price in desperation he was wrong. All three coins will be offered on eBay in the near future.
All glory is fleeting.
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Comments
<< <i>My point is actually very simple. If dealers don't soon change their buying practices they will soon be buying nothing. >>
I agree. It is too easy for collectors to bypass the dealers through eBay.
Dealers that have targeted their niche of the market towards the upper end collectors offer a valuable service and the expertise to go with servicing those types of clients. They aren't the ones who will be suffering the lion's share of problems created for dealers by ebay. The average dealer is the one who will be forced to trade coins with a very thin margin to compete. Simply put, making 2 or 3% on a 50k coin if you have a ready buyer isn't the same thing as making 2 or 3% on a 300 dollar coin. No doubt the margins are substantially higher, but you get my drift.
Ebay has provided most collectors with an opportunity to buy and sell within very thin margins. Sure, we still pay full retail in many cases, but we also sell at full retail. As far as I'm concerned, this just means that the term wholesale will have to increase across the board for moderately priced material; thus squeezing most dealers for not only profits, but for material to sell.
Like most industries, this usually ends up in mass consolidation to survive, with many dealers simply moving on to other things. Some might opt to diversify their business and try to insulate themselves from having to depend on one industry to make their living.
If you factor in the growth from new collectors and their interests in modern issues, you can see why many of the less substantial dealers have opted to cater to that niche to survive.
I think eventually we will see a lot of dealers going for the new collectors and the modern issues and a few top notch dealers catering to the upper crust while the vast majority of the die hard hobbyists bid it out on ebay.
When we are planning for posterity, we ought to remember that virtue is not hereditary.
Thomas Paine
You walk up to my table. See a coin you like. Ask a price. I say "How much will you pay?".
You tell me a price.
I get insulted.
I put the coin back into my showcase and lock it.
Then I walk away. Mumbling something about the cheapa$$ retail buyer.
Most retail customers that are selling their coins have no idea of the exact dollar amount they want. But they do know what they don't want. As in "that's too cheap".
How would you like it if every time you made an offer on a coin the dealer told you to come back at then end of the show because he/she wanted to see if any other retail customer would pay more. And when you did come back at the end of the day/show, the dealer said he/she sold it.
Okay flame away, I'm a big boy.
njcoincrank
i won't flame you, but i'll point out something that i'm sure you already know. what i think 291fifth is trying to say is that the dynamics of the dealer/collector transaction are changing in part as a result of eBay. it makes sense to me that you and Legend would react as you have, simply because things appear on the surface to be tilting towards the collector with regards to a transaction completion. eBay is a welcomed alternative to a collector wishing to sell at a fair price.
my example is that i attempted to sell some nice material in mid-November at a show and then to a dealer at his shop. offered were essentially insulting amounts and i subsequently sold the coins on eBay for more than i would have accepted in offers from dealers. i didn't expect sheet ask or even bid prices. i understand and accept a 10%-25% markup and would have taken that.
i think your comparisons are kind of a knee jerk reaction to the change taking place. as a collector who occasionally sells, i rarely encounter success at a show. all i ever ask is what i rarely receive, a fair price offer. if i assume what Legend asserts to be true about dealer markup, i should be getting much better offers when i try to sell at shows. evidentally i'm encountering routine exceptions to the markup she perceives, or she is wrong.
al h.
Many dealers probably factor in their offer based on whether or not they are purchasing a coin they intend to sell to another dealer. Should they be the dealer with an end customer in mind, they would likely offer a stronger price.
There are a lot of dealers out there who spend the majority of their time in the trenches dealing with other dealers and make a good portion of their money from transactions that never involve an actual end customer. In equity trading, they are called specialists. These guys are not effected by ebay and rightly deserve a class by themselves. But there are good number of other dealers who will have to adapt to and embrace ebay and the internet.
When we are planning for posterity, we ought to remember that virtue is not hereditary.
Thomas Paine
As a collector who occasionally sells coins (more for fun, than for profit), I have found that ebay is an excellent outlet to buy/sell less expensive coins. The coins that I look to buy (No Motto branch mint gold) almost never appear on ebay. When they do, they are low end. Similarly, when I think of selling a less expensive coin, I use ebay. Dealers do not want my junk, but somewhere, other collectors do. ALWAYS.
As far as selling coins to dealers, my suggestion is to develop a relationship with a few dealers for buying and selling. Just as a dealer will usually give his/her regular customers a better price and an early crack at the high-demand coins, I expect that most dealers will give their better customers a fair price to buy their customers' coins. Many dealers will give you 100% back on coins purchased from them on a trade or upgrade. And, they will give you an honest opinion of what your coins are worth and how to dispose of them if they are not interested. A good relationship with a dealer in your area of interest will save you money or make you money in the long run. Ebay will not do this for you.
I think that Laura made a good point in that collectors often do not know what the market value of their coins really is. We all think that our coins are wonderful, all PQ, all undergraded, blah, blah, blah. I think if we look at our coins more objectively, or have a disapassionate third party appraise them, the value will be quite a bit different than if we collectors value our own coin.
Anecdote: I met James (Jadecoin) at a local show. I brought some crummy old large cents that I was looking to get rid of. We talked a bit, developed a rapport, and I showed him my coins. He looked at them, hemmed and hawed a bit, and made me an offer. If I was expecting 2"X", he offered me "X". I asked him if he honestly wanted the coins or if he was just doing me a favor by buying them. He replied the latter. I took the coins home and sold them all on ebay for 3"X" and promised myself that I would never put a dealer in that situation again.
I can think of a dozen reasons not to have high capacity magazines, but it's the reasons I haven't thought about that I need them.
RYK...You make some very valid points.
Keets.....I've met you, I respect you, and I consider you one of the few retail customers I have, even without conducting a transaction yet. Enough said.
One other thing to keep in mind is the coins you're selling. Don't take this wrong, but if you are selling semi-generic items (average ms 64 toned commems, sort of better date morgans in ms 62, etc) the dealer may not have a home for them, or better yet, can get them at virtually any time he/she does. Yet the retail customer expects, no DEMANDS, an offer within 10 to 20 percent of current retail. Show me any area of collectables where the retail consumer can get a 20 percent spread on their collection AT ANY TIME. Stamps? Right. Baseball cards? Oh yeah.
But if you have something really special (really pretty and or rare), chances are you might be able to sell it to another dealer at the same show you bought it at. I know I've offered collectors a profit on coins that they just bought.
eBay has indeed changed something about the market place. But I ask you this: At what point does a collector selling some coins on eBay become a dealer? One sale a month? Seven a year? And what about all the eBay buyers that are the subject of some thread on these boards? Don't like it when the buyers doesn't act EXACTLY like you want him/her to? Too bad. That's business, plain and simple.
The reality is that most dealers (not all) started out as collectors. They know both sides of the fence. As Kid Rock says, "You want to point your finger, you better point your finger in the mirror".
Flame away.
njcoincrank
<< <i>As far as selling coins to dealers, my suggestion is to develop a relationship with a few dealers for buying and selling. >>
I agree.
Even for a low budget, low-end collector like myself, the best (I should say "only") experience I have had selling coins was selling them back to the same dealer I purchased them from. My local dealer usually buys coins back for a few dollars less than his original price on the coin, assuming the coin is in a flip with his original price on it. (I assume he trusts that his regular customers won't switch coins in the flips since he hardly even looks at them when I sell them back to him.)
I'm very lucky to have a local dealer that operates in this manner. I realize this is impractical for collectors with specialized and/or hard to find want lists that must purchase from several dealers. But for a newbie like myself who collects relatively easy to find coins, this is a real security blanket.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
you make some points that are hard to argue with and even harder to flame. i kind of figure a lot of dealers struggle to stay at least in part a collector, and i'm stymied by why anyone would want to be a dealer!!!
al h.
I do not have much trouble selling.I ask for more then i want and they make their offer,if i like it ,SOLD,if i don't like it ,i say thank but no thanks.I do try to leave the buyer a little room to sell,but then agan,i don't sell often.
Good topic.
In all of my years of collecting, selling coins to dealers has nearly always been a frustrating, unpleasant experience. This was true in the 1960's and it is still true today.
Over the next several months I am going to liquidate my collection and probably leave the field for good. My selling experiences at MSNS this past weekend only served to confirm my decision to leave the field. Coin collecting, for me, has been a hobby. The coins are worth whatever the market will bring. My goal is to minimize my loss as a profit is very unlikely.
With the advent of eBay I now have access to a much broader base of the market than was the case in earlier years.
Based on my actual experience in selling coins to dealers and my actual experience in selling coins on eBay I plan to sell the great majority of the coins on eBay.
Dealers have made the selling experience something I dread. eBay has made the selling experience (with the exception of a few bad apples) enjoyable (though not necessarily profitable).
Check out some of my 1794 Large Cents on www.coingallery.org
I know that I HATE when someone asks me to make an offer. Why: First, you don't know if the person is just pricing you and putting you into a mini auction (where someone else can out bid you by $5 or whatever). Second, how do I know if I am going to be too low and get the person pissed off? I know the argument will be: if you are making your highest offer then what is the problem? Well the problem is, sometimes a dealer can want a coin very much and still be off by 10-15%. They might very well stretch -especially if they feel they are NOT being played. I know I try harder if I am NOT backed into a corner. "
I've read you state you sell to dealers and they have paid you what you consider all the money in this "HOT" market (you know those sales in the hotel and before the show opens). How can a "HIGHEST" buyer still be selling to other dealers, they're higher buyers.
I believe dealers want you to quote a price hoping for a low quote. Consider the guy who hasn't been to a coin show in many years, he has no idea of the value of his coins and dealers want him to quote the selling price?....CA CHING
Great point. Guess all we, as sellers, have to do is know exactly who wants what and how much they'll pay....... until then, it's hit and miss and involves risk.
No one can accurately state they'll pay the most for every coin. But stating they'll pay the most in general is a bit more accurate.
<< <i> We're all the highest buyer on the coins we really want to own. >>
Yes. And a coin show is a lousy place to find any dealers who really want to own inexpensive coins
or any coins that are the least esoteric or have a limited market.
it seems there are supposed to be two sets of rules we should play by on the bourse floor, or at least one set where the dealer is given the upper-hand or the collector is somehow seen as wrong for expecting equal latitude in a sale. why not expect to have the same principals at the point of sale between a seller and a buyer in effect when a collector sells to dealer and when a dealer sells to a collector??
in essence, this is what takes place when a dealer offers a coin for sale. while a price may be stated, offers are accepted.
al h.
As usual, you make a good point. The dealer is the expert/professional in the arena of buying/selling coins. He/she should know or have access to pricing information to buy/sell coins and should be a resource for this information.
Personally, I do not usually have access to updated wholesale pricing information, nor do I have the disposition to haggle to buy or sell a coin. (The dealers love to sell coins to me!) When I ask a dealer how much he/she would pay for a coin, I mean it sincerely, not as a means to some other end.
As far as selling to dealers, there are some I will seek out to sell to and others that I avoid. As with everything in life, there are good ones and bad ones. I'd rather sell to a dealer that will offer more for a choice coin rather than just quote me a price that is printed in a periodical. And, I wouldn't expect to receive a great price for a so-so coin. That's just the way it works.
We'll use our hands and hearts and if we must we'll use our heads.
A good point that I alluded to previously. The collector always assumes his/her coin is desirable. To the dealer it may be very ordinary or even undesirable. I think that a lot of times dealers low ball the collector, as a courtesy, because they really do not want to buy the coins. It is a lot nicer than saying, "I do not care for your coins" or "I do not need your coins."
They need to buy as well as sell, right?
I may not want to get up in the morning and go to work but it's my job and that's how I get paid so I do it.
Can you really take the chance that someone is not serious or is just looking for pricing info or is pitting you against
another dealer?
Maybe the personality of the seller just makes them more comfortable with the dealer (the professional, right?) coming up with a price.
-KHayse
I view dealers as offering a service. They do not produce the coins, they do not create inventory. Just as in any service transaction, the client (or buyer) must determine what that service is worth. You could spend 30 minutes on your back under your car changing your oil, or you can pay $25 for the oil and service. Likewise, you can go to a dealer and sell your coins to her/him to act as a middleman, or you can spend time on eBay to list, interact with potential buyers, collect payment and ship your coins. Based on what Laura says, every coin on eBay should be a steal and nobody should attend shows because "My suggestion to anyone who isn't understand all this: be a genuis, sell your coins only at auction and quit moaning (although when your coins don't sell that way or sell to cheap you might scream)!" However, people attend shows and buy things at what must be higher than eBay prices (only logical if what a collector sells on eBay is less than he should expect to get offered from a dealer which then needs to be marked up for a profit). Why? Shipping costs do not have to be included, sight-seen quality, instant gratification - all parts of a service. Even if it is the exact same coin, many will pay more for this service aspect and always will. How much that service is worth depends not only on the collector, but also on the exact coin that s/he is searching for at that time.
On the other hand, I as a collector, have the right to sell or not sell any coin if I do not feel that the price is worth the percieved value of my coin. Your being a "dealer", or a professional, does not force me to kow-tow to your almighty wisdom. I choose how much the coin is worth, to me, and subtract from that value how much your dealer services are worth in moving that coin. Its a competitive world with many fish in the sea, so I should politely accept or refuse any offer and move on.
Now, concerning making offers for coins, we all know that in any transaction, the first one to state a value is at a disadvantage. What is the number one rule of job interviews and salary negotiations? "Never be the first to state a value. Always deflect the question back to the interviewer." In coins, price guides help some with this part of the transaction, but we all know that they are only guides, a starting point. And as a dealer, don't telll me that if someone brought a coin to your table for sale and you valued it as a quick sell for $1,000 and the asked the seller "How much?" and he said "$100" that you would say "That is too little, I'll give you $800 (20% profit for you)"? Afetr all, all dealers are professionals and know values of coins like it is their job.
I guess that I have rambled enough, for now.
<< <i>
I guess that I have rambled enough, for now. >>
that was some pretty good "rambling."
i brought coins to sell at santa clara and dispersed them among six different dealers. i got, generally, what the coins were worth, some a little less, some a little more. i'm developing a feel for who will pay how much for what, and it's only dogs that bring dog money. If one does the footwork and finds appropriate dealers for their material they can do okay at a decent sized show.
I understand that ebay will show my coins to collectors who will obviously pay more for an end product than a dealer who must flip the inventory, but as long as i didn't pay way too much, which i generally haven't, i do okay.
One thing i've learned is to show not the best, but some good, quality coins to a dealer. If they want them and we are close on price, i will then bring out the better coins. If they don't want them, but are honest about it and obviously seriously looking for good material, i will also show the better coins. if i am simply offered blue sheet or, worse, a percentage thereof without further thought, guess what...
i'm never offended by an offer, but likewise, if i'm not shown respect, you will most definitely not be shown the real pretty coins that you definitely want to buy.
z