Buying stamps below face value

pocketpiececommems

I've been to several coin shows where there are dealers selling coils of stamps below face value. They range from the 37 to 42 cent stamp. Where do these coils come from?

johnsim03

Hi,

These come from numerous sources. Estates from collectors and dealers, going out of business sales, etc.
Lots of collectors buy sheets (or pads!) of every commemorative issued, and these sell on the secondary
market below face - because that is what they are worth. The more odd the denomination, the more discount
from face.

Mint stamps in sheets, in general, are horrible investments. For every sheet which appreciates in value, there
are hundreds which do not. Those that have no premium cannot even be sold for face upon resale - you have
to discount them in order to sell them.

I can buy discount postage all day long in the 70-80% of face range. Check out postage lots on eBay or on
some of the other auction sites.

Another reason some dealers have a lot of these - it is almost like discounted cash - so it is a method of exchange.
For example, I might have $10,000 face of mint sheets. The dealer has an item priced $6500 or $7000 that I want.
We "might" make a deal where I would trade my sheets for his item that I want. A barter. The dealer knows that
he can generally get (wholesale) at least 65-70% if the denominations are decently high, less if very low. In the
retail market, he can easily get 80-90% face if he is prepared to sit on them for awhile (often a long time!). The
only one who loses is the guy who paid face value for the sheets to begin with...

John