This is not meant to be a joke but... how do smaller dealers stay in business?
TheLiberator
Posts: 1,028 ✭✭✭
I visited the local coin shop in Tampa...the one that started me collecting when I was younger. This guy doesn't mess with the internet, buys wheat penies for 2 cents each from the public, doesn't deal much with real rarities, higher priced items or slabs and it's his full time gig. How can you make living doing that? I really mean no disrespect to any dealer out there but it seems EXTREMELY hard to me. I though profit margins were so slim that you had to sell tons of items to make a living. Maybe he just lives on a meager budget or...maybe I am missing something? Any insights anyone? I truly am curious! (I would go broke in a week!!! 
Btw...he does go to F.U.N. so maybe he goes to lots of other shows?
Btw...he does go to F.U.N. so maybe he goes to lots of other shows?
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He's probably a millionaire now
(but was probably a multi-millionaire when you first met him)
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and it sets us apart from practitioners and consultants. Gregor
Probably the most unusual moment of the day was when an older gentleman came up to the table and when we started to chat he told me he was a retired dealer who used to have a store. (Remember, I am behind a dealer's table wearing a dealer badge, so he didn't see any need to hold back, I guess.) He started to reminisce and told me a story which I'd like to relate in his own words (pretty close, anyway).
"I was successful because I knew how to buy coins. I made the shop owners rich. That's where the money is - in the buying. You know you can't pay top dollar and charge the lowest prices in town. No one can make it that way. I knew how to buy. A lady came in one day and said, 'I have a coin but I don't want to sell it.' I said, 'Then how can I help you?' She said she wanted to trade it for silver dollars. You might not believe it, but she was holding a nice 1878-CC five. I asked her what she wanted to trade for, and she said she wanted eight silver dollars. I told her she could pick any eight from my case she wanted. Then I called one of the shop's owners and told him to come down to the shop right away. I gave him the five so he didn't have to share it with his partners and I never even wrote it up. I didn't like the other partners anyway. I think he sold it for ten grand.
"And see this ring? (It had a $5 Indian.) One time I was at a show where I didn't have a table when another dealer asked me to work his table while he went to lunch. While I was covering for him a guy came up and pulled out two big handfuls of loose gold coins to sell - two and a halfs, fives, eagles and double eagles. I was good at sizing people up. I could tell what they would accept right away. The guy was with his girlfriend and they didn't look like they knew much about coins. The girlfriend looked nervous and I figured the coins were stolen. So I offered him double face for the whole pile. He said, 'Hey, these are gold, aren't they?' And I said, 'Yes, but they aren't worth much. You could take them to someone else, but I pay cash and don't require any identification.' See, I wanted him to think other people would make the deal complicated. I knew the girlfriend would push him to take the money and sure enough she told him to just take the money so they could go. So when the other dealer came back I showed him what I bought and when I told him I only paid double face, he gave me this five and I had a ring made out of it."
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
Its still that way today but with the internet and tpg's you have more options.
<< <i>Here's a repost of a casual discussion I had at a recent coin show with a retired dealer who ran a coin shop full time. It was a shop I had been in many times as a youngster. It might provide a clue to how some (not all) smaller dealers survive...
Probably the most unusual moment of the day was when an older gentleman came up to the table and when we started to chat he told me he was a retired dealer who used to have a store. (Remember, I am behind a dealer's table wearing a dealer badge, so he didn't see any need to hold back, I guess.) He started to reminisce and told me a story which I'd like to relate in his own words (pretty close, anyway).
"I was successful because I knew how to buy coins. I made the shop owners rich. That's where the money is - in the buying. You know you can't pay top dollar and charge the lowest prices in town. No one can make it that way. I knew how to buy. A lady came in one day and said, 'I have a coin but I don't want to sell it.' I said, 'Then how can I help you?' She said she wanted to trade it for silver dollars. You might not believe it, but she was holding a nice 1878-CC five. I asked her what she wanted to trade for, and she said she wanted eight silver dollars. I told her she could pick any eight from my case she wanted. Then I called one of the shop's owners and told him to come down to the shop right away. I gave him the five so he didn't have to share it with his partners and I never even wrote it up. I didn't like the other partners anyway. I think he sold it for ten grand.
"And see this ring? (It had a $5 Indian.) One time I was at a show where I didn't have a table when another dealer asked me to work his table while he went to lunch. While I was covering for him a guy came up and pulled out two big handfuls of loose gold coins to sell - two and a halfs, fives, eagles and double eagles. I was good at sizing people up. I could tell what they would accept right away. The guy was with his girlfriend and they didn't look like they knew much about coins. The girlfriend looked nervous and I figured the coins were stolen. So I offered him double face for the whole pile. He said, 'Hey, these are gold, aren't they?' And I said, 'Yes, but they aren't worth much. You could take them to someone else, but I pay cash and don't require any identification.' See, I wanted him to think other people would make the deal complicated. I knew the girlfriend would push him to take the money and sure enough she told him to just take the money so they could go. So when the other dealer came back I showed him what I bought and when I told him I only paid double face, he gave me this five and I had a ring made out of it." >>
What a Basttard. I guess people will do anything for money. Even rip off old ladies.
Happens all the time. Stuff sits in the safe and the general public never sees it.
LSCC#1864
Ebay Stuff
Positive BST Transactions (buyers and sellers): wondercoin, blu62vette, BAJJERFAN, privatecoin, blu62vette, AlanLastufka, privatecoin
#1 1951 Bowman Los Angeles Rams Team Set
#2 1980 Topps Los Angeles Rams Team Set
#8 (and climbing) 1972 Topps Los Angeles Rams Team Set
Enjoy the time there while you can. It'll likely count more than the coins in the long run.
and it sets us apart from practitioners and consultants. Gregor
michael
<< <i>I visited the local coin shop in Tampa...the one that started me collecting when I was younger. This guy doesn't mess with the internet, buys wheat penies for 2 cents each from the public, doesn't deal much with real rarities, higher priced items or slabs and it's his full time gig. How can you make living doing that? >>
1) Most don't make a living - they try dealing coins for a while then do something else.
2) Others don't need to make a living - they are retired, or have another means of support or otherwise deal coins for fun.
3) The few that do make a go of it buy low and sell high. But I guess maybe their version of 'making a living' might not be the same as yours?
I should probably stop in again, just to see if they have anything.
PURPLE!
IMO, coin shops provide a convient service for those with little knowledge of coins who want to sell their coins easily and quickly. Hopefully the coin shop owner is honest and will pay a fair price. Then he/she must turn those coins quickly, and the fastest way is to sell to other dealers at a small margin.
Tough business I imagine, but if you have a good location in a metropolitan area and a good reputation, then I suppose you could survive.
To be a dealer it means you have expenses that collectors cannot imagine. There is the expense of the shop, employees, travel, dealer table fees, etc.
If someone walks up to a dealer and hasn't even bothered to do five minutes of research on the coin or coins they are offering, then they deserve what they get. In the case of the old woman, for example, if she had taken just a few minutes to open a book she would have had a rough idea as to what the value was in what she was offering.
The second part of the story where the dealer thought the coins were stolen really scares me. Those could be my coins or any other collectors coins being offered. The dealer should not have bought those coins.
Each dealer needs one or two transactions a month where they make a large profit to stay in business. Those are the facts of life and of business.
<< <i>In the case of the old woman, for example, if she had taken just a few minutes to open a book she would have had a rough idea as to what the value was in what she was offering.
The second part of the story where the dealer thought the coins were stolen really scares me. Those could be my coins or any other collectors coins being offered. The dealer should not have bought those coins. >>
aye yi yi
it' ok to steal from that old woman who didn't know what she had, and went to an "expert" to sell, but it's not ok to fence your coins?
Mr Pot, meet Mr Kettle
<< <i>it' ok to steal from that old woman who didn't know what she had, and went to an "expert" to sell, but it's not ok to fence your coins?
>>
Let me put this into perspective. Let us say you want to sell your car. You go to a used car salesman and he says "I will give you $10 for it". Would you take the $10? The aswer is no. The answer is no because you opened a book and found out what it was worth. If he can get you to sell your car to him for $10 then he is going to do it. He can't be responsible if you are too lazy or simple to figure out the approximate value before you come to him.
If you went to him and said I will take $10 for it and he says "Hey mister are you crazy, that car is worth $10,000", you would die from a heart attack. He then opens up a book and says "Oh, my mistake you have low miles on that car, so it is actually worth $12,000".
Give me a break people. The dealers cannot and should not be responsible for training the people that walk in with no knowledge and expect to get the best possible price.
And one more thing... If any dealer buys coins they suspect are stolen then that is called fencing (maybe some law enforcement types can weigh in here) and they can go to jail.
How many people buy on ebay, and get a great deal, but send the seller more money because the coin is worth more than they asked?
I want to hear the answer to this question... The answer is "are you crazy" I bought the coin for $x and that is what I am sending the seller. If the seller didn't know any better than to offer the coin for the right price then that is his problem.
<< <i>
If someone walks up to a dealer and hasn't even bothered to do five minutes of research on the coin or coins they are offering, then they deserve what they get. >>
Hmmm. I don't know baout that. For example, my father is one of the most honest and trusing men there is. He just doesn't understand there are many many people ready to pounce on his trust. He is so susceptible to a salesman's friendly smile and handshake that he wouldn't dream it was anything other than a nice conversation with no ulterior motive. My father is not stupid...he is quite brilliant in fact. He is just a 70 year old man who grew up in rural Georgia where being friendly and talkative were the name of the game. So, do people deserve what they get when they expect to be treated fairly and honestly by a dealer and get ripped off instead? I have a hard time feeling that way myself...
I do understand your point about educating yourself though. Consumers should take that upon themselves because if they don't, many peope will give them a lesson in hard-knocks they won't soon forget. It has always been this way and it always will. Sad but true!
As an aside, I think law enforcement and prosecutors, which for the most part are not interested in anything short of murder, would have a mighty hard time determining a dealer suspecting coins are stolen.
<< <i>it takes an amount of unsavoriness and lack of morals to have a business where your livlihood depends on lying in wait for someone to walk in who doesn't know what they have and steal it from them. Granted, she didn't have to sell, however, having witnessed this very activity on a number of occasions, I personally find it near larcenous.
>>
Well spoken.
I think a coin dealer should throw a question like "how long have you been collecting?", or "did you inherit these?" or some other cursery question that should make it pretty obvious the person selling does not own the coins.
">"http://www.cashcrate.com/5663377"
<< <i>If someone walks up to a dealer and hasn't even bothered to do five minutes of research on the coin or coins they are offering, then they deserve what they get. In the case of the old woman, for example, if she had taken just a few minutes to open a book she would have had a rough idea as to what the value was in what she was offering.
The second part of the story where the dealer thought the coins were stolen really scares me. Those could be my coins or any other collectors coins being offered. The dealer should not have bought those coins. >>
Why does the second story scare you? It just was another example of the person's unethical nature. Steals from an old lady, steals from a young couple, the guy is a thief, period. The fact that he preyed on a lay person only makes it more represensible.
Here's a scenario for our readers. Let's say you or your spouse drop off their wonderful 1 carat diamond wedding ring at your locally-owned jewelry store to have the worn prongs replaced. A couple of days later you pick up the ring and are quite pleased with the work. Is all well or was the diamond switched for a cubic (which are now found with inclusions)? After all, if you only took about 5 minutes to educate yourself, you certainly could tell the difference. Don't think this happens . . . ? This is just one example where even intelligent lay people can be burned by the dishonest who walk among us.
Just because we, as coin experts, CAN take advantage of people when buying coins, does not mean we have to do so.
Lane
See http://www.doubledimes.com for a free online reference for US twenty-cent pieces
<< <i>If someone walks up to a dealer and hasn't even bothered to do five minutes of research on the coin or coins they are offering, then they deserve what they get. In the case of the old woman, for example, if she had taken just a few minutes to open a book she would have had a rough idea as to what the value was in what she was offering. >>
here's a hypothetical.
My mother has a coin socked away, which came, lets say from her grandmother. She finds it one day and shows it to me. Assuming I know nothing about coins, I take a digital photo of the coin because I work with a guy who knows about coins.
Before I see my mother again, she takes it to a coin shop and the owners tells her her chain cent is worth $25.00, and buys it from her.
When I find out what it is I call her to tell her the great news. She tells me he sold it to Sy the Coin Shop Guy for $25.00. "He said that was what it was worth"
I go to see Sy with my Mom and ask him about the coin.
What does Sy say?:
1) I never bought a coin from your Mother.
2) The coin wasn't a chain cent, at which point I produce the photo.
3) It was a counterfeit.
4) She should have known better and got what she deserved.
Any guesses?
It's called a sales job.
I know, there are plenty of good guys. But how good are they and us for letting this be the norm, and not just a rare occurance. And to those of you that carry the mantra of "you deserve it because you didn't educate yourselves"....screw you too!
<< <i>it takes an amount of unsavoriness and lack of morals to have a business where your livlihood depends on lying in wait
It's called a sales job. >>
it seems more like accredited robbery, referencing what fat man said about credentials, basically a license to steal, mislead and profit from the inexperience of those not in the hobby
Is it any different from the Xerox salesman that comes into my office to sell me a new photocopier? He's going to try to sell me the biggest machine he can and get the most he can from me, without me saying no thanks and calling Canon next. I'm going to try and offer as little as I can, without him just walking out from a lowball offer. It's all a game of give and take, that requires some education on the buyer's part. Some buyer's are better than others, just as some sellers are better than others.
How can a dealer look anyone in the eye after they came to his shop and he said "it's worth $40.00" (not I'll PAY $40.00) only to have the person go to an honest dealer who offered 15-20% back of bid and the get $9,000! What does the dealer say to that person who returns to their store and says "you tried to rob me" not just get a better price but rob that person blind of a valuable item.
What would you say?
<< <i>And while I am on my soap box...
How many people buy on ebay, and get a great deal, but send the seller more money because the coin is worth more than they asked?
I want to hear the answer to this question... >>
But your question is not on point. You are comparing an open-market sale (eBay) to a lone individual asking the opinion of a professional for a private transaction (the "old lady" walking into the coin shop) . . . apples and oranges.
Lane
See http://www.doubledimes.com for a free online reference for US twenty-cent pieces
<< <i>I am not a dealer, just a collector. I usually sell on eBay exclusively.
To be a dealer it means you have expenses that collectors cannot imagine. There is the expense of the shop, employees, travel, dealer table fees, etc.
If someone walks up to a dealer and hasn't even bothered to do five minutes of research on the coin or coins they are offering, then they deserve what they get. In the case of the old woman, for example, if she had taken just a few minutes to open a book she would have had a rough idea as to what the value was in what she was offering.
The second part of the story where the dealer thought the coins were stolen really scares me. Those could be my coins or any other collectors coins being offered. The dealer should not have bought those coins.
Each dealer needs one or two transactions a month where they make a large profit to stay in business. Those are the facts of life and of business. >>
Oh yeah, try an justify it by blaming the ignorance of others! If it was Ronald Reagan, would you still rip him off? Get it?
As far as your stolen coins statement, its the thieves that cry the most when their ripped off!
<< <i>This thread illustrates what is wrong with our hobby. The concept that someone must educate themselves or deserve to be burned is crap. These people are not taking their coins to a thug on the street or flea market seller. They are taking their coins to dealers who proudly display their hobby and professional affiliations like "Life Member ANA" and "Member of Professional Numismatic Guild -PNG" and others. These are supposed to be assurances of professionalism and integrity. Unfortunately all these groups do is perpetuate the fraudulent activities in our hobby because it is clear that these affiliations are meaningless. Shame on them and everyone of us who accepts this as the way it is. I love my coins but everyday I am disgusted with the manner that these trade.
I know, there are plenty of good guys. But how good are they and us for letting this be the norm, and not just a rare occurance. And to those of you that carry the mantra of "you deserve it because you didn't educate yourselves"....screw you too! >>
KUDOS to the FatMan
Rookie Joe