Why, whether you realize it or not, you're probably looking for trouble if you ask a dealer for an o

coinguy1

Why, whether you realize it or not, you're probably looking for trouble if you ask a dealer for an offer on your coin at a coin show - here is why I say that......

1) If you ask for an offer, receive one and accept it, there's a decent (or better) chance you have sold your coin(s) too cheaply.
This certainly applies if you sell your coin(s) to the first dealer to make the offer(s). More, in a moment, about getting subsequent offers from other dealers.

2) If you receive an offer that you think or know is too low, you hopefully wont sell your coin too cheaply, but, you'll probably get upset, possibly VERY upset.

3) Or, the dealer might decline to even make an offer, in which case you might also get upset/frustrated.

Unfortunately, the three situations above cover most likely scenarios/outcomes, so you have pretty much condemned yourself to selling your coin(s) for too little and/or not selling and getting upset. I ask you - why would you want to go and do a thing like that?

Now, back to getting subsequent offers as mentioned in #1 above - many dealers, even completely fair and honest ones, prefer, for good reason, NOT to make offers at coin shows and here's why:

Often, a seller will request an offer from a dealer at a show - I'll name the dealer in this hypothetical "Honest Abe". Honest Abe makes a very fair offer - let's say $500 for coin X, thinking or knowing he can sell it for a 10% profit. Seller, who might have had little, if any idea as to the real value of the coin, then says " Let me think about it and I'll get back to you." or "I'm not sure if I want to sell at that price but thanks." or something like that.

Seller then goes to another dealer (let's call him "Lowball Abe"), who offers $300 for the coin, knowing full well, it is worth considerably more. Seller then says, "Well, Honest Abe has already offered $500 for this coin." So, Lowball Abe, says, "Well, I guess I'd pay $510 then". The seller, who should not trust Lowball Abe at this point, decides (rather than going through any more of this nonsense) to sell the coin to him for $510.

Honest Abe, who provided a fair offer and good information to the seller, is left in the cold, while Lowball Abe ends up with the coin, AFTER trying to rip off the seller.

The above hypothetical is a composite of what I have seen and/or heard of on many occasions. The bottom line is, that based on the behavior of many sellers at coin shows, Honest Abe often puts himself in a no win situation by making a fair offer on the coin(s).

I think, if at all possible, a seller should do thorough homework, to find out ahead of time, what he could/should expect to be able to get for his coin(s). And, that it is better to quote an asking price, rather than soliciting offers and subjecting himself to some of the not-so-desirable outcomes mentioned in 1), 2) and 3) above.

I realize that there are many exceptions to what I have noted above. But, hopefully some of you can save yourselves a bit of grief, either way, in the future.

nwcs

Reminds me of the process of buying a car.

coinlieutenant

Good post Mark,

It is a bit of a paradox is it not?

John

AACoinCo

Mark,

When you ask a cutomer what he/she need for a coin why don't they speak up? I have tried this over the years and it is like pulling teeth to get an ask price out of a customer. They always put the light back on me and i make a fair offer but one where i know i won't get hurt and also one that if i have to stock the coin for several month allows me to still make money. If it is a key or short turnaround coin my offers are always stronger.

cherrypickincoin

Great post, Mark! This reminds me of an experience I had at the fall show in Long Beach last year. A had a bit of a shmorgus board of about $15,000 worth of Dimes, commemoratives and other nice pieces that I took to the show with me (don't ask) and as I was preparing to leave a dealer that I was passing by called me over and asked me if he could see what I had. He went to his little book and told me that he came up with a value of $6,500 and that he would pay it to me in a company check on the spot. This guy tried to tell me that proof Mercury Dimes were dropping in price and some of my monster toned Morgans weren't attractive. One of these gorgeous proof Mercury's, by the way, was sold to me by jbsteven here. Anyway, this guy didn't even offer me half of what the coins were actually worth and he was trying to persuade me that it was all I was going to be able to get for them.

I ended up selling that specific grouping for over $20,000 through private sale. Don't ever allow yourself to get cheated! Always get other offers!!

Again, great post.

shirohniichan

<< <i>Reminds me of the process of buying a car. >>



Yea, verily.

Whoever bids first loses. You would think that a few people would have enough common courtesy to the buyer who originally offered him the highest price to see if he'd match what the low-baller last offered, but you would be wrong.

puff

Mark..... I was hoping there weren't any astute coin collectors out there, (and especially those that read this forum), that would be ignorant enough to do the things you suggest in your various scenarios...... But then on second thought after reading some of the threads posted on this forum I suppose you could find a few here that might fit right in!

1jester

Fantastic post, and info, Mark. Thanks!

paigowjohnny

Nobody ever wants to give the first price...then you're locked into a range.

Barry

I rarely sell to dealers (more on this in a minute), but when I do, every single time the dealer has asked me what I want for the coin. He's never made an offer first. Smart on his part - say he was willing to pay $600. If I ask for $500, he's made out. If I ask for $700, he says no thanks and nothing lost.

Why don't I sell to dealers often? Because the dealer has to make money by reselling the coin, so he won't buy it for what a retail customer would pay. In the old days, a collector had no way to access the retail customer. That has changed! As much as we enjoy pointing out scams and ragging on Ebay, that's how a collector can get retail for coins.

As nwcs pointed out, there are parallels to the automobile market. If you sell your car to a dealer, you're not going to get as much as with a private sale. Why do it then? The convenience may make the cost worthwhile to you.

route66

My question is, do dealers really buy a coin hoping to make a 10% profit. [under $1000.00]. I'm an older collector who remembers the old days and back then 100% profit was more the norm. I can't beleive today is any different unless it's slabbed or highly sellable. Even then 10% isn't very much. JMHO Steve

coinguy1

Steve, I used the 10% profit figure to stress that the offer in my hypothetical was extremely fair. In answer to your question, though - in the large majority of cases - no.

agentjim007

I suppose the only option for someone with an old collection and no idea of current value would be an auction. Maybe they could do their homework but it could take years to do enough to become market savvy. Their time is worth money and they might not want to invest that kind of time.

Clankeye

Here is one thing I think most people lose sight of when they want to offer a dealer their coins. Most "rare" coins aren't rare. A cliche--but true. Dealers have access to them at any given time, and really don't have an incentive to buy them unless they are getting a super steal deal.

The only way I would offer a dealer one of my coins at a show is if I knew that coin was absolutely stand out for it's type and grade. I would have to feel that coin had a hook, that would make the dealer offer anything at all, let alone above average money.

And given that--if the coin was that nice--I would probably want to hold out and explore the options of selling it directly to a collector so I could realize the most money for it.

If I had the time, and the inclination.

Clankeye

dorkkarl

your assertion ignores the time-value of $. your assuming that someone's willing to wait the time it takes to get the 2d (or 3d or 4th or 29th) offer.

ie i might be willing to take the $300 IF time were more valuable to me at that moment than $200.

if your scenario were 100% true, then agentjim would be correct - ALL coins would ALWAYS have to be sold at auction to receive a fair price.

as you noted, there are many exceptions to your scenario.

K S

Wisconsin

I think for a seller to expect dealers to be fair to them they have to be fair to the dealer and maybe go by the following guidlines:

1. Tell the dealer your intention of getting a few offers before selling. This way they know they will have to be competitive if they want the coin.

2. Ask the dealer if their offer is good for the day or just until you leave the table??

3. Tell them that you will not disclose their offer to anyone else in all fairness and ask if they want to know if you get a better offer, or if that is as much as they can afford to put into the coin no matter what.

I think if you are fair and honest to the dealers you have a much better chance of receiving the same treatment in return. And remember that a fair offer is both fair to you and fair to the dealer as they need to make a profit to stay in business.

Jay

baccaruda

My question is, do dealers really buy a coin hoping to make a 10% profit. [under $1000.00]. I'm an older collector who remembers the old days and back then 100% profit was more the norm. I can't beleive today is any different unless it's slabbed or highly sellable. Even then 10% isn't very much. JMHO Steve

Not anymore - collectors now have access to each other via Ebay and other online auctions. Collectors can sell for more and buy for less - the middleman is getting squeezed.

hoardmonster

Interesting thread!

ohbaby

Interesting post Mark.

What about the situation where someone does not have the expertise and may never have the expertise to value coins. The coin market changes month to month it seems and how many non pros can keep up AND have a life?

How many times have we heard or read or know someone who walks into a coin/stamp shop, real estate office, collectibles store, antique store, antiquities shop, etc. and ask for $xxxx for their property. The prospective buyer sees the unrecognized value and buys the item on the spot. The seller is happy and the dealer within hours or days turns the item for a 500%+ profit. Is that a win win?

As a kid I was ripped off when buying coins from Littleton, I didn't know better. Now I know better and find dealers trying to rip me off when trying to sell. Things have gotten better but there are so many dishonest dealers out there it is discouraging. These days I find myself reading more about coins than actually buying them.

If the shenanigans going on in the collectibles area were subject to government regulations I bet more than half would go out of business and another quarter would end up in jail.

lordmarcovan

Excellent post.

The solution is put 'em on eBay yourself, and don't sell your coins to dealers!

(Oops. I don't wanna shoot myself in the foot. I'll shut up now. I am a dealer, after all.)

'Tis indeed a delicate dance, negotiation. In numismatics, as in anything.

CalGold

Mark,

Sound advice for the timid. For the bolder collector, this method usually works well.

Approach a dealer at a show with a centrally located table, and ask him how much he is willing to pay. Regardless of the amount quoted scream, YOU CHEAP, LOW-BALLING SKUNK and punch him in the nose as hard as you can. Then politely approach the dealer at the next table and ask him to make his best offer.


CG

AACoinCo

You need to find a reputable group of dealers and stick with them. If you bring them nice coins they will pay top dollar. I have prized customers who regularly bring in coins that i pay a premium for which saves me the time and frustration of playing the auction game. I would rather the customer get the 15% auction juice instead. When a customer comes to my table at a show i honestly give them my offer and ask them to stop by and let me know if i was off base. If i can up the offer i do. But those show table and travel expense cost a bit of money and the customers don't always take that into consideration. The typical mark up on a silver eagle for instance is $.50 and that includes all the time and effort in slepping them to the shows.

barberlover

I agree with most of whats been said here but when you need money suddenly and don't have time to wait to auction your coins and get paid later [sometimes much later] it is neccessary to go thru dealers.

A plug here, when the need suddeny arose for me to get money fast last year I sold about half of the coins to Mike Printz at Larry Whittlows and while maybe Mike helped me because he's a nice guy I don't think he made hi offers because he liked me as the only reason for his offer. Mike paid me a very fair price for the coins I sent him and if ever had to sell in a hurry again I certainly would do so.

I guess it all depends on what you have to sell and who you do buisness with as well as how fast you need the money.

Here's a question for you Mark, lets say that a large coin auction firm insists on payment on auction coins with no time needed for reurn privledges to expire [because their aren't any] within a week of the invoice date, but on the other end takes 2 months to pay out to the sellers. Sounds like an interest free loan to me, what do you think?
{Not that I'm trying to put you on the spot or anything] .

Edited to say 2 months, but my point was if the auction companies insist on prompt payment from buyers then they should have prompt payment to sellers also.

Les

coinguy1

<< <i>Here's a question for you Mark, lets say that a large coin auction firm insists on payment on auction coins with no time needed for return privledges to expire [because their aren't any] within a week of the invoice date, but on the other end takes 4 months to pay out to the sellers. Sounds like an interest free loan to me, what do you think? >>

Les, the well known/highly regarded auction companies typically pay consignors within 45 days - if someone took "4 months" they were likely taking advantage of the consignor and/or were having financial difficulties. Either way, in the absence of a wonderful explanation, I'd hesitate to do business with them again.

michael

excellent thread


michael

291fifth

Auction is the way to go.

Shamika

I like hearing advice from dealers. Thanks.

njcoincrank

First and moremost I agree with most of Mark said. What little I do know about the coin buying public is this: When it comes to selling their coins, they usually don't have a clue as to what they want; only what they don't want.

Example: Collector asks dealer if he is interested in a coin. Dealer says "yes, what do you want for it?" Collector says "I don't know. What do you want to pay?" Dealer gives collector a price only to have the collector become angry saying "that's too cheap....you only want to steal my coins."

If you have a range for what you want, perhaps it would help if you told it to the dealer. I know that when a collector gives me a price range that I am able to tell right away weather or not I have a shot at buying his coin. If not, I politely tell them that I don't think we will be able to get together on that particular piece and thank them for offering it to me.

Simple as that.

And yes there are some low life scum dealers out there. There is also an equal number of low life scum collectors. It is up to each of us to decide if we feel comfortable with the transaction.

njcoincrank

wingedliberty

Mark:
Very interesting, but you are stereotyping, Dealers are human beings and it depends on the dealer.
Dealers maybe stereotyped, but they run the entire spectrum. Some are scum bags, others I know, I would trust with my life. Its the same in any other hobby or endeavour. You are making something simple far too complex.

Askari

Very interesting thread!! I do think, though, that everyone should re-read Wisconsin's post -- and maybe print out for future reference. His is the most reasonable suggestion I think I've ever heard. It sure would simplify the negotiating danse macabre!

coinguy1

Askari, I agree with you, completely, about Wisconsin's/Jay's post - I am only sorry that you beat me to the compliment.

Wisconsin

Thanks guys for the compliments. It only makes sense to treat dealers fairly and in return most will treat you the same.

Try to immagine how many times these dealers have been offered coins, have had games played with them , people looking for free appraisals etc. If you are a straight shooter and tell dealers your intentions and how you want to do, I believe most will be much more friendly and easy to deal with.

Jay

BigE

If someone takes advantage of you in the coin business you are a wimp, as in any other business. A good dealer such as Mark will cut your losses and maximize your gains but if you bought the wrong coin you bought the wrong coin-----------------------BigE

Trime

Mark,
Lots to think about in this post.

northcoin

Good advice. When it comes to cashing in one's collection ignorance is bliss. If you buy and never sell (i.e. collect rather than invest) life is much simpler. In fact the best remedy for overspending on one's collection is to try to sell a piece or two to a dealer. It kills the buying urge for at least three months.

DaveG

I guess I'm lucky, in that I've never sold a coin to "a" dealer. I have, however, sold coins to "my" dealer.

I make all my purchases at shows and have developed relationships with several dealers. I don't sell coins very often, but when I do, I sell them to the dealer who sells that type of material (and is thus more likely to: a) be happy to make the purchase and, b) offer more. I've found that selling coins to one of "my" dealers enhances our relationship and frequently gets me the "first look" at new purchases.

And, when I want to find out what price levels are for a particular coin, I have a good enough relationship to ask "Where do these usually trade?" and get an accurate answer.

Frankly, I'm amazed at all the "I walked up to a dealer and got treated badly" stories. Haven't the storytellers developed a relationship with any dealers?

Bear

Hey, pull a gun on Coinguy and he

is good for another 10% offer on your coin.