NGC is now PNG "Official Grading Service" (MORE INFO ADDED)

homerunhall

For the past 5 years or so, PCGS has been the "official grading service" of the Professional Numismatists Guild (PNG.) We had been paying the PNG $40,000 per year, or $120,000 per three years.

This month the PNG accepted bids for a three year exclusive contract to be their "official grading service." They accepted bids from two grading services, PCGS and NGC. We made the business decision to bid a lot higher than the previous contract because of the competitive positions of the two grading services involved. PCGS bid $504,000 for the three year period in the form of $60,000 a year in cash and the remaining amount in free grading slots for PNG members. NGC bid $544,000 for the three year period in the form of $65,000 a year cash the first year and small increases in that cash amount for the second and third year along with free grading slots for PNG members. The bids were supposedly "sealed."

So NGC outbid PCGS for the right to claim they are the "official grading service" of the PNG. NGC is also the "official grading service" of the ANA. That too is a paid endorsement, and NGC outbid PCGS on that endorsement a few years back. We are not upset that we did not get this endorsement as we bid what we thought it was worth to us, all things considered. We did however, feel that buyers of third party certified coins deserve to know that these are paid endorsements...hence this post.

The bottom line is that an endorsement can be bought. Respect and value in the marketplace must be earned.

David Hall

ealandg

I'm sure this must be frustrating. It sounds very political.

kieferscoins

Will PCGS change the hologram on the back of the slab?

Cameron Kiefer

homerunhall

Cameron...Yes, we are going to change the hologram to say "Formerly Official Grading Service of the PNG."

Russ

"NGC probably wrote a bigger check".

I swear sometimes I think I'm a genius.

Russ, NCNE

IrishMike

<< <i>Cameron...Yes, we are going to change the hologram to say "Formerly Official Grading Service of the PNG." >>

mgoodm3

You've probably made Cameron's day by saying that.

ElectricEye

Seeing as how the endorsement goes to the highest bidder, it pretty much ruins any thought of that endorsement truly meaning anything relevant to the quality of the company selected. ACG could have had that honor with the right amount of cash.

kieferscoins

"Cameron...Yes, we are going to change the hologram to say "Formerly Official Grading Service of the PNG.'"

Good one. Add the word "sample" like: "Sample of a former PNG slab" and we will be in business

Cameron Kiefer

poptopsRus

I'm sure it isn't worth the $$$$ to be the offical anything. Is it going to effect the amount of coins coming in, I highly doubt it!

IrishMike

I wonder if official grading company for the 2004 Olympics in Greece has been spoken for?

topstuf

Certified grading services to bring uniformity and consistency by introducing objective criteria to the grading of coins..

See? I wrote the whole sentence without laughing.

ElectricEye

I was thinking perhaps, Coca Cola, Hustler Magazine, or Tide might make a better sponser hologram design...

lava

David, why bid at all? People in the know can see that PCGS coins bring more dollars at every sale. Any seller is going to want their coins in a PCGS slab. Those that say otherwise, well, I simply don't believe them. At any rate, who cares what is the "official" grader for PNG. I'm a little surprised they would even put that title up for bid. It should be earned. PCGS still remains the preferred professional grader from everything I can tell. The only people who cross the street seem to be the guys submitting inexpensive modern coins that don't care to wait 75 days for their grades. Why not simply say something to the effect that PCGS is an acceptable grading company adhering to PNG standards.

Russ

<< <i>I wonder if official grading company for the 2004 Olympics in Greece has been spoken for? >>



I'm pretty sure Hostess Twinkies has that sponsorship locked up.

Russ, NCNE

Barry

<< <i>"NGC probably wrote a bigger check".

I swear sometimes I think I'm a genius.

Russ, NCNE >>


Sometimes maybe, but not this time Russ. The answer was obvious.

Irish Mike - I was going to say the same thing, but you beat me to it!

HRH - If you want to be my official grading service, I'll do it for half what you offered PNG

puff

I could care less who the official grader is for PNG....... I have collected PCGS coins, and only PCGS coins for the last 10 years, and willl continue to do so....... Even though I disagree with their grades on occasion, they still are the most consistant and conservative of any of the grading services in my opinion....... If they get to the point where they get to liberal with their grading to try and keep up with the liberalism of NGC this will only hurt them in the long run......

Now that I have made a Cammie suck-up statement David will that get me any special favors!

Russ

<< <i>Sometimes maybe, but not this time Russ. The answer was obvious. >>



Yeah, I know. But at least I was first.

Russ, NCNE

jbsteven

since PCGS is saving 500k does this mean price reduction on grading fees?

tradedollarnut

PCGS bid $504,000 for the three year period in the form of $60,000 a year in cash and the remaining amount in free grading slots for png members. NGC bid $544,000 for the three year period in the form of $65,000 a year cash the first year and small increases in that cash amount for the second and third year along with free grading slots for png members.

Hmmmm. As owner of a construction subcontracting company that submits large bids almost daily, I'm completely amazed at the similarity of the bids. Did the PNG request them in that specific format? Seems that similarity is what's gotten HRH a bit hot....

lava

I detected that too, tradedollarnut. Seems like the bids weren't so secret while the bidding process was underway. If I'm David, I think I'll look back at this in a year and conclude NGC did me a big favor -- let them go in the hole for a title.

spy88

I'm assuming that 5 years ago pcgs had to outbid NGC to earn it's rights to be PNG's official grading service for those last 5 years! If this is true.....why does a president of a TGC make moronic statements about why they lost?

I truly can't believe David Hall is whining about this. I remember when he lost out to NGC on the ANA endorsement. David Hall went absolutely ballistic and began complaining about his 'open checkbook', that it wasn't fair since ANA didn't negotiate on good faith with PCGS and it would have written any size check to get the ANA endorsement. Now DH is complaining he lost out because of $5000 per year. C'mon, man. This is furtherance that PCGS cannot step up to the plate when required. Thumbs down PCGS, thumbs up NGC. Brilliant marketing strategy for NGC.

Posts from across the street.

jeffnpcb

And perhaps David Hall is jealous,PO'd and just assumes he is a shoe in. TV shows sell a lot of PCGS coins as well.

dorkkarl

<< <i>Respect and value in the marketplace must be earned >>

are you saying ngc hasn't earned "respect" & "value"?

K S

Stuart

David (HRH): Thanks for sharing this information with us. I work in sales for a Petroleum Service Company in Houston, and am quite familiar with the tendering/bidding process. Thanks for shining some "daylight" on this by sharing this "sealed bid" process with us.

As you and other forum members have already stated in this thread, respect must be earned. Both PCGS and NGC are very credible grading services who guarantee the coins that they certify. Having at least two strong players in any market niche (like coin grading) is generally good for the consumer.

In retrospect, I have generally been very pleased with the PCGS certified coins that I have purchased. I have not yet submitted any coins for certification at any of the grading services, and therefore perhaps have a different perspective on PCGS graded coins.

When purchasing coins I can be selective and try to purchase conservatively graded coins, or better yet borderline coins at the lower grade. Therefore as a consumer I appreciate very conservative grading standards. If I were submitting coins for grading, I may opt for a bit more liberal grading standards -- but obviously consistency over time is the most important factor.

Thanks again for sharing this with us...

joecool

It sounds like politics; I think NGC had someone on the inside. The bids are close to each other; there was no secret bid. PCGS doesn't need a sticker that has PNG on it; it needs one that says FNGC. PCGS are the leader in grading and they have the best holder. PCGS certified coins sell at a higher premium. I have a sticker that I will sell PCGS for half the their bid price......

Russ

<< <i>I think NGC had someone on the inside. >>



It is interesting to note that the sponsor of the NGC Trade and Grades also happens to be the head of the PNG.

Russ, NCNE

SethChandler

So what if ACG paid 600k? Would they have gotten the endorsement?

Coconut

I don't care about a sticker on the holder. What's important is what's inside the holder....

nwcs

<< <i>So what if ACG paid 600k? Would they have gotten the endorsement? >>

If they offered 650,000 I bet they would have. If it was in cash.

Russ

<< <i>So what if ACG paid 600k? Would they have gotten the endorsement? >>



I'd assume that the PNG had some qualifying criteria established. Like, for example, only real grading companies were allowed to bid.

Russ, NCNE

cosmicdebris

Geez just like in Washington the Lobbyist with the most money win.

MacCoin

a little wake up call for pcgs.

Placid

More money for pcgs to use for something else.
I never even knew pcgs was the offical png grading service.

I wonder how much ngc would bid to be the offical grading service of my coin club

Aethelred

For $10,000 and 100 free gradings per year you can be the "Official Grading Servive of Michael Swoveland" for as long as you like. Make it $12,500 and I will not even return NGC's calls!

IrishMike

Koolaide, koolaide tastes great
Koolaide, koolaide can't wait.

(PS must of been sour grape koolaid)

Conder101

<< <i>PCGS bid $504,000 for the three year period
NGC bid $544,000 for the three year period
The bottom line is that an endorsement can be bought. Respect and value in the marketplace must be earned. >>


I can't help but wonder if that would have been the PR statement if the bid amounts had been reversed?

Skipper53

I'm not sure it's all politics or all money.
I believe NGC also got the contract for the coins being
brought up from the SS. Repuplic.
They seem to be VERY aggressive when it come to
sales and/or recognition.

Winning contracts or sponsors may impress some people
some of the time.
If you're not the best, those customers and sponsers will
realize their mistake soon enough.

Hang in there , PCGS and don't let a bully affect your standard.

Skipper

Russ

<< <i>I believe NGC also got the contract for the coins being
brought up from the SS. Repuplic. >>



They got that contract on the strength of their conservation division, NCS. They have the unique ability to handle both aspects in-house.

Russ, NCNE

Barry

Does anyone really care who PNG endorses?
Boy, whatta waste of money!

joecool

BigE

HRH is probably PO'd about having to re-make the hologram, a little expensive I imagine, and NGC knew this, probably PCGS should have this seen this coming and probably did, it's good they didn't get the bid, less sleepless nights------------------------BigE

Bear

I believe if PCI or ACG came up with a million dollars

the pimps at the National Associations and Dealer Associations

would have sold out what ever dubious integrety they may still posses.

oreville

Hmmmmmm.......I was wondering why CLCT stock price was so strong today. Perhaps the thoughts of additional cost savings by not having to pay PNG $$ got more investors excited about CLCT?

OR........... was that expectation that PCGS was going to win the contract?

robertpr

Who f---ing cares? The only reason most collectors even know the PNG even exists is because they have had their hologram on the back of PCGS' slabs for so long. If their hologram wasn't there...nobody would know who they are anyway...so shouldn't the PNG be paying a grading service to have their advertisement on their slabs and not the other way around? Maybe now that you have some free space on the back of your slab you can move that stupid barcode onto the back like it belongs.

DMWJR

I don't have much to say about the "bidding" itself, because this sounds like standard operating procedure for any industry where companies are submitting "sealed" bids. There are plenty of moles and information sources out there peddling info for money and/or favors. Sad, but true.

I will say one thing I feel strongly about -- ANA and PNG endorsements are inappropriate period -- at any price. The integrity of each should not be compromised by monetary contributions.

David, here's a sneaky idea -- do a little recon on your own next time, leak out a little misinformation like PCGS bid $1,000,000 for the next endorsement, and see if you can make the other services cough up even more money. As a member of the ANA, and supporter of their programs, I would love to see a million bucks poured into the association.

For what it's worth, I think most people understand the "endorsement" system, and it doesn't really enhance anyone's opinion of a given service.

Bear

The PNG and membership in it never meant anything to me before.

The PNG Logo on the back of PCGS Slabs never meant anything to me before.

The removal of the PNG Logo doesnt mean anything to me now.

The quality of PCGS grading and the value of coins in its slabs mean a lot to me,

both before and now.

ElectricEye

<< <i>here's a sneaky idea -- do a little recon on your own next time >>



Here's a different idea, next time, don't bid. Why waste the money on an honor that only can be had by paying the highest bid? I'd love to hear NGC's response when they find out they just bid $600,000 for the endorsement and no one else bid! The endorsement would have no value if (1) NGC and PCGS did not both bid for it and (2) someone like ACG, ICG, or SEGS had it.

nugget369

With all due respect to the PNG, who the hell are these people?

CaptainRon

What the Bear said.

oreville

My personal take is the following:

I happen to feel that David got a little ahead of himself and should apologize to NGC and PNG for making the statement he did. He should have stuck to the facts and wished NGC luck the next time the bidding takes place three years from now.

As to concerns to the other issues, they should have been brought up in a separate forum at another time as a separate topic for discussion. There may be legitimate issues here but I feel that right now, it does not look proper to bring up here on the very first day of the announcement.

The high road always works better!


EDITED: I see that David modified his original statement to do exactly what i thought he would, that is take the higher road.