Undergrading: Profit Motive?

scottsusor

Purely theoretical question ... Would it make sense for a professional grading company to undergrade the majority of cards, figuring that many of them will be cracked and resubmitted, thereby increasing profits?

Scott

bill7549

I'd just seriously doubt a company like PSA would do that. They get so many cards to grade that they have been way behind here recently. Not to mention the stain on their reputation if too many people get screwed by undergrades.

Vargha

In a conspiratorial world, it all makes sense.



<----- Black Helicopter

calleocho

BGS tried this in the beggining and it backfired badly , people stopped summiting vintage cards to them.

the consistent grader is what people want in the long run , not the hardest or the easiest.

i dont think PSA managment thinks that if they grade too strict they might get 10 to 20% back of those cards to be regraded.

Vintage high grade is limited, the big money is elsewhere.

maybe 70's or 80's.

Wabittwax

In theory, it makes sense, but in reality, it would destroy a grading company. I submitted 3 batches to BGS when they first came out, just to give them a try. 1 of the batches was so harshly graded that I broke out EVERY card because every card was worth more raw. The next batch was a tad better but I still took a pretty good loss on the batch. The third one, I barely made a profit on but that's only because 1 good card saved me in that batch. I gave up on BGS. Since that time, I have submitted about 3000 cards to PSA. Not saying that I would have submitted those 3000 to BGS, but after those batches, BGS was totally out of the picture. Never again.

67standup

<< <i>Purely theoretical question ... Would it make sense for a professional grading company to undergrade the majority of cards, figuring that many of them will be cracked and resubmitted, thereby increasing profits >>



Probably not. But a reputable company could monitor the number of 9/10s and manage to a set percentage of all cards that can be 9/10s. It's similar to a professor's grading scale: most have an unofficial quota of how many As,Bs, etc. are given. Too many, and they're being too lenient. Too few, and they're being too tough.

To many 9/10s, and value/allure for those goes down. Does anyone get excited when they see a "rare" Capitol/Gem/Pro/ASA/KSA 10?

Fabfrank

Wabitwax- Same thing happened to me. 8's and 8.5's on perfect cards. I decided that if BGS was going to make a reputation as hard graders, let them do it with someone elses cards. I haven't submitted to them since.

Basilone

My take is that there is a very, very small percentage of hobbyists that submit and resubmit over and over to get a desired grade. I seriously doubt that grading companies would have that modus operandi.

John

CON40

It makes sense if you consider that PSA attracts many submissions because of the value increase gained when a vintage card grades high. If too many high grade vintage cards are in the marketplace, then supply will meet demand and theoretically prices should drop. If prices drop, then the allure of grading cards may lose its luster resulting in fewer submissions. If they are a shrude operation, the practice of grade allocation could be part of PSA's business model.

mikeschmidt

<< <i>Probably not. But a reputable company could monitor the number of 9/10s and manage to a set percentage of all cards that can be 9/10s. It's similar to a professor's grading scale: most have an unofficial quota of how many As,Bs, etc. are given. Too many, and they're being too lenient. Too few, and they're being too tough.
>>



And this is a good point. There has been a lot of talk over the years (from a conspiracy perspective) that this is one of the reasons why there has not been a Nolan Ryan rookie in PSA 10 yet - for example. By "managing" the high-grade rookies so that 1/1 HOF rookies in 10 come out on a slow pace - that ensures that there are stories / excitement in the hobby.

Heck - there has been a lot of speculation that quite a few of the major PSA 10 rookies used to reside in PSA 9 holders. That is more a question of consistency than anything - but still.

Also - found it kind of funny/amusing that GAI very quickly graded a GAI 9.5 GEM MINT Ryan rookie - and there still is not one in a PSA holder. Not that it necessarily means conspiracy or makes any sense - but it is interesting to note nonetheless. Sometimes you simply have to accept that some of this is just a game - and sometimes it is not played too fairly. Case in point: 1971 Topps PSA 9 Rose card that quickly became a PSA 10....

srs1a

Marc, interesting observation on the Ryan rookie. SGC has not graded a GEM MINT copy either...or a MINT example for that matter.

ctsoxfan

<< <i>Sometimes you simply have to accept that some of this is just a game - and sometimes it is not played too fairly. Case in point: 1971 Topps PSA 9 Rose card that quickly became a PSA 10.... >>



Well said. I would like to think that there is no way in the world that "grade allocation" exists, and it probably doesn't. But a compelling argument can be made for keeping the numbers down on the really desireable PSA 9's and 10's, as mentioned here. Good thoughts in this thread so far, but I think just grading fairly will ultimately be it's own reward for a grading company. If there are 1000 PSA 10's or just 1 that exists, so be it.

MorrellMan

I've been following this thread and I like where you guys have gone with it. With over 7 million cards graded, a curve is established on most popular cards. Short of a huge find of low pop cards, there would really be no reason, given random submissions, that that curve should radically change, meaning that low pop cards will continue to be low pop cards, and, in fact, become lower in population exponentially as more examples are graded.

murcerfan

Short of a huge find of low pop cards, there would really be no reason, given random submissions, that that curve should radically change, meaning that low pop cards will continue to be low pop cards, and, in fact, become lower in population exponentially as more examples are graded.

yeah, except that everybody sends in those low pop cards, even borderline..and those low pops are more likely to cracked and re-submitted, so there can actually be a disproportionate shift.

1962 Topps Football is a classic example.

Scumbi

PSA needs to keep customers happy. They are not going to break the bank on ten card resubmissions. They would rather have you happy and sending 500 card lots. Undergrading is a combination of getting too attached to your cards plus the subjective nature of the beast.

S.

scottsusor

<< <i>PSA needs to keep customers happy. They are not going to break the bank on ten card resubmissions. They would rather have you happy and sending 500 card lots. Undergrading is a combination of getting too attached to your cards plus the subjective nature of the beast. >>


10 card resubmissions isn't how it would play out. Those 10 cards (or more) would be placed into the next 50 or 100 or 500 card submission, and just sort of blend in.

PSA does indeed need to keep customers happy. Undergrading -- subjective or not -- won't do that.

Scott