Dealer Inventory Mangement

earlyAurum

What do dealers do with coins the can't sell for a profit because of demand or market moves? Do they hang on in hopes of a comeback (this would be costly in terms of negative carry and opportunity cost)?

Do they realize the losses behind the scenes in the wholesale market?

This must be very difficult to handle.

Thanks,
early

dsessom

Throw them on Ebay and hope for the best.

RYK

All of the above, including sometimes tossing them in auction and sometimes getting pleasantly surprised with the results. Some hang on to coins for years and years and years...

earlyAurum

I ask the question not only out of curosity but because I am interested in some coins more than one dealer's inventory that are not likely to sell because they are overpriced. I suspect that I will see these coins at auction soon but high reserves will likely prevent them from selling.

blu62vette

Some seem to hang on for years on some coins.

Walmann

If it happens to enough of their inventory, they admit they are collectors and not dealers.

PTVETTER

what is over priced to one person is a bargin for someone else.

Flatwoods

<< <i>what is over priced to one person is a bargin for someone else. >>



Very true. I am continually amazed at items (not just numismatic) that I see for sell and say"What kind of idiot would pay that much for that" They generally sell quickly!!

Tassa

<< <i>I ask the question not only out of curosity but because I am interested in some coins more than one dealer's inventory that are not likely to sell because they are overpriced. I suspect that I will see these coins at auction soon but high reserves will likely prevent them from selling. >>



Have you considered contacting them and asking if they can do better on the price?

earlyAurum

<< <i>Have you considered contacting them and asking if they can do better on the price? >>



Yes, I have and they do not want to realize a paper loss. They prefer to pay the carry and forgo the opportunity cost. It doesn't make sense to me as I am willing to pay roughly 10 to 15 below their cost.

It is diffficult to realize a loss on anything but mayber harder for coin dealer as it might be viewed as negative in terms of their ability to make markets in coins.

PTVETTER

ever hear of PT Barnum!

shorecoll

Antique dealer mentality. An antique dealer I know has a hoard of common date Morgans bought during the Hunt debacle, waiting for silver to get back to $30-$35/oz...until then they'll stay packed in the safe. They own them outright and will not sell them at a loss.

cape

Myself--- if the market has changed the coin will either go in auction or I take a hickey. Its better to get some of your working capital back for new purchases !