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Which types of dealers hold non-selling products the longest?
Bochiman
Posts: 25,556 ✭✭✭✭✭
So, there are some items I am watching on ebay (coins in top slabs) and they dno't have "Make Offer" but are rather just high on the price and waiting for a sucker, imho.
There have been a few I have watched on some of the dealer websites as well. Dealers who do attend shows (small and/or large).
Knowing that money flow is important, and seeing some other top dealers decie not to keep coins too long (maybe send to an auction house after XX amount of time of not selling), it made me, as a buyer and not a dealer, wonder.....what is it that makes certain dealers hold onto the coins priced too high at the moment? Not talking about bullion related (and, really, I am looking at classic coins and not moderns, though I can imagine some modern sellers could be affected).
Is it:
* Coin isn't that much of a hit to the dealer (say, under a couple of thousand dollars or a few hundred) and so dealer doesn't worry about flipping for huge cashflow adjustment?
* Dealer bought the coin superlow and is looking for the huge score?
* Coin may have slipped through the cracks and dealer just hasn't worried about getting rid of it?
* Dealer has an ego, to the point that NOTHING will be "given away", and the dealer feels this is the right price. It is just the market hasn't realized that yet?
* Dealer is very strict and straight forward. Buy at $xxx and sell at $xxx+15% (or whatever percent). Coin sits until it is sold?
* Websites are cheap and already accounted for. Same with ebay stores. So, as long as the money is still coming in from other coins, then coin stays higher priced and hopes to sell.
* Dealer doesn't want to discount as may suggest to buyers that other coins may be overpriced as well and start to get less sales at the higher levels?
As someone who has only flipped moderns or sold dupes, I am just curious on the above and what people think are good reasons for a dealer to hold a coin they have taken the trouble to image and place online for sale, for MONTHS (not just a couple of months. 6 months or more (sometimes a year for some I am seeing). I am sure many of us have seen this, and are seeing it, so I won't post specifics as I am not trying to point out certain dealers.
I do know that, in a few cases, I may have wanted the coin, but it was so overpriced that I think any offer I made may have insulted the dealer(s) and made it harder to deal with them in the future (ie..."here's that lowballer again....I really don't want to deal with them"), so I have kept hunting and sometimes have found coins that were just as nice (or better) for much less, and don't need their coin anymore but I do check in, just out of curiousity.
Edited the title as I realized I left out 2 important words: "types of"
There have been a few I have watched on some of the dealer websites as well. Dealers who do attend shows (small and/or large).
Knowing that money flow is important, and seeing some other top dealers decie not to keep coins too long (maybe send to an auction house after XX amount of time of not selling), it made me, as a buyer and not a dealer, wonder.....what is it that makes certain dealers hold onto the coins priced too high at the moment? Not talking about bullion related (and, really, I am looking at classic coins and not moderns, though I can imagine some modern sellers could be affected).
Is it:
* Coin isn't that much of a hit to the dealer (say, under a couple of thousand dollars or a few hundred) and so dealer doesn't worry about flipping for huge cashflow adjustment?
* Dealer bought the coin superlow and is looking for the huge score?
* Coin may have slipped through the cracks and dealer just hasn't worried about getting rid of it?
* Dealer has an ego, to the point that NOTHING will be "given away", and the dealer feels this is the right price. It is just the market hasn't realized that yet?
* Dealer is very strict and straight forward. Buy at $xxx and sell at $xxx+15% (or whatever percent). Coin sits until it is sold?
* Websites are cheap and already accounted for. Same with ebay stores. So, as long as the money is still coming in from other coins, then coin stays higher priced and hopes to sell.
* Dealer doesn't want to discount as may suggest to buyers that other coins may be overpriced as well and start to get less sales at the higher levels?
As someone who has only flipped moderns or sold dupes, I am just curious on the above and what people think are good reasons for a dealer to hold a coin they have taken the trouble to image and place online for sale, for MONTHS (not just a couple of months. 6 months or more (sometimes a year for some I am seeing). I am sure many of us have seen this, and are seeing it, so I won't post specifics as I am not trying to point out certain dealers.
I do know that, in a few cases, I may have wanted the coin, but it was so overpriced that I think any offer I made may have insulted the dealer(s) and made it harder to deal with them in the future (ie..."here's that lowballer again....I really don't want to deal with them"), so I have kept hunting and sometimes have found coins that were just as nice (or better) for much less, and don't need their coin anymore but I do check in, just out of curiousity.
Edited the title as I realized I left out 2 important words: "types of"
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
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as you can toss your price to them...nothing ventured...nothing gained
i just wish these coins wouldn't pop in "newly listed"...over n over n over again as it taints fresh listing searches
i'd imagine some dealers...pretty much most of their inventory is..."per se" free stock anyways as they've made soo much off other coins purchased from seller
it just snowballs and snowballs to amazing masses the free stock they accumulate over the years
<< <i>i would like to get Julian's take on the matter. >>
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i>i would like to get Julian's take on the matter. >>
You said what was on everyones mind!
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SeaEagleCoins: 11/14/54-4/5/12. Miss you Larry!
But some of the other local dealers have the same stock for years, I have seen coins still sitting in one particiular shop for over 3 years . Several of the small regional shows same thing, there are several dealers who have the same stuff they had since I been going to shows, never moves. Apparently they dont have to sell.
And , yes the statement about having free stock does occur, when buying collections, you end up having some coins with little too nothing in them. Where other dealers will simply hold until they get their asking price, i will move it out after a short period of not selling via the above.
Not that I need to desperately free up cash, but cash is king when buying coins via a B & M. Perfect example , just last week the dealer above I mentioned had inventory sitting for 3 years, he could not buy a 16k silver deal that walked in over at his shop becuase he had no liquid cash. I got the deal, and sold it within 2 days.
The same goes for other dealers who have coins offered at prices that seem to high for the market for those of us that participate in those markets.
Again, for those that always want new coins, think about various collections. Most collections are assembled with care, each coin hand picked. Now imagine being assigned a task as a dealer that you have to acquire all the coins in your own collection in one weekend or even a three month period, at the same quality level, at prices where the coins can be resold for a decent living wage. For most collections that would be a difficult task. Dealers know this, especially those that like to think that they deal in quality. Quality coins are hard to come by, especially at prices where they can be resold at a profit.
Ebay overpriced or highly priced items represent free advertising. And a lot of room to manuever in trades.
There is a dealer in So Cal that has to be worth 50 million min. and he never puts the best of the best out. But it's there in the safe. The stuff I've seen is awe inspiring.
However, I can speak for myself and note that some coins last more than a few months (2-4 months) on my site and may even last up to or possibly over six months on my site. Most of my sales are dealer-to-dealer at shows so in between larger shows there is a time that coins might sit apparently idle. Also, I deal in a large range of type and some of this type is thinly traded. Therefore, even super cool items might not have a ready buyer for them, but it doesn't mean that they were free to me and that I can blow them out at firesale prices. Those coins might sit a bit until they are seen by the right buyer in the niche or brought to auction for a wider audience. Lastly, some of the coins that appear on my site are consigned to me by valued clients and these pieces can sit for a longer period of time if my clients are at a certain level. Those consigned coins cost me nothing to list, but of course I would not carry anything where I would be harming the buyer. Indeed, the consigned items can be the most tricky since I want the seller to be comfortable with the level of the sale yet want the buyer to be satisfied with the out-of-pocket expense and the quality, too. Lastly, most of the coins that I handle never even make it to my website as they either go to other dealers or they go to the clients who have asked to be on my advanced notice email list. This means that only a minority of the pieces I handle end up on my site so the apparent length of time that coins are in my possession would be skewed higher for those unaware of all the items moved prior to listing.
By the way, I do not do ebay so none of this applies to that venue. I sell exclusively through my website and at shows.
In honor of the memory of Cpl. Michael E. Thompson
<< <i>
<< <i>I do not like Realone calling out Julian. He has done nothing wrong. Pricing a coin out of RO's price range is not a crime, fraud, or ethical violation. If RO wants to buck up and buy the coin, fine. If not, he should move along.
The same goes for other dealers who have coins offered at prices that seem to high for the market for those of us that participate in those markets. >>
RYK, ain't noghting wrong with your opinion on the matter, my opine is your nose has gotten quite brown on the tip as of late, but maybe it is becoming since we have never met! >>
My opinion is that you have no class and your two posts to this thread back up my statement rather well.
The fact that you (in general- not directed at any specific poster) don't understand why someone (dealer or not) does what he does is not evidence there is not a good reason.
edtied to add...
<< <i>i would like to get Julian's take on the matter. >>
Why?
Lance.
<< <i>
<< <i>
<< <i>
<< <i>I do not like Realone calling out Julian. He has done nothing wrong. Pricing a coin out of RO's price range is not a crime, fraud, or ethical violation. If RO wants to buck up and buy the coin, fine. If not, he should move along.
The same goes for other dealers who have coins offered at prices that seem to high for the market for those of us that participate in those markets. >>
RYK, ain't noghting wrong with your opinion on the matter, my opine is your nose has gotten quite brown on the tip as of late, but maybe it is becoming since we have never met! >>
My opinion is that you have no class and your two posts to this thread back up my statement rather well. >>
Interesting, I think you are being politically correct which I didn't honestly believe about you, I thoght am was pointing out a fact in a backdoor kind of way. Are your running for some political office that I should know about? >>
Mayor of the forum
<< <i>I thoght am was pointing out a fact in a backdoor kind of way. >>
Why not be upfront about that fact and say what's actually on your mind?
edited for clarity...
to get the price they want.
<< <i>I have had a number of dealers tell me that they dont mind holding a coin for a year
to get the price they want. >>
Nothing at all wrong with this. I'm sure there are collectors who do the same. Not that this will satisfy those who think that sellers (dealers or collectors) should offer their coins at prices buyers want them to.
<< <i>
<< <i>I have had a number of dealers tell me that they dont mind holding a coin for a year
to get the price they want. >>
what about 16 years or so? >>
What's wrong with that?
<< <i>
<< <i>i would like to get Julian's take on the matter. >>
You said what was on everyones mind!
Who is everyone?
<< <i>I thought I was, by sneaking my point in... >>
How does one be upfront with something while sneaking it in when he thinks nobody is looking?
edited to add... you still haven't explained why you want to hear Julian's opinion on the topic.
<< <i>
<< <i>I have had a number of dealers tell me that they dont mind holding a coin for a year
to get the price they want. >>
what about 16 years or so? >>
It wouldn't surprise me if some dealers I know had the same coins
in thier case since 1980!
<< <i>
<< <i>I have had a number of dealers tell me that they dont mind holding a coin for a year
to get the price they want. >>
Nothing at all wrong with this. I'm sure there are collectors who do the same. Not that this will satisfy those who think that sellers (dealers or collectors) should offer their coins at prices buyers want them to. >>
Oh, I know it ! It's like some buyers want you to send the coin
with a $200 cash rebate taped to it !!
<< <i>Oh, I know it ! It's like some buyers want you to send the coin
with a $200 cash rebate taped to it !! >>
The interesting thing is the same collector who complains about a dealer who won't sell a coin for the price the collector wants would squeal like a stuck pig if the dealer even suggested that the collector sell to him at a price determined by the dealer.
<< <i>
<< <i>I have had a number of dealers tell me that they dont mind holding a coin for a year
to get the price they want. >>
Nothing at all wrong with this. I'm sure there are collectors who do the same. Not that this will satisfy those who think that sellers (dealers or collectors) should offer their coins at prices buyers want them to. >>
I actually don't think you are referring to me, but you may be, but I will still reply anyway
I don't care/mind if a dealer holds a coin forever. My reason for the thread is not to force any dealer to think my way, as I am just a collector and part-time flipper. I have a "real" job so I don't depend on coin sales for my living, which is fine with me right now as I like to collect and not sell.
I do get it that there are all types of dealers. I am just getting at a bit of irony/confusion/non-understanding when I see/hear some say "it is important to turn inventory over in order not to be left holding the bag and have new products coming in", and what Jim said with "having cash for liquidity".
The examples I am thinking of are NOT about "free/cheap advertising on ebay". Of that, I am pretty sure. I have seen those types of coins/prices/advertising, and the ones I am thinking of aren't close. They aren't multiples of reality, nor are they super unique coins.
I've actually seen this where some of the dealers are about selling...full retail maybe, but still selling.....but a few of the items sit and sit.
Oh well, it was a thread just meant to hear some reasons to help me understand. Not to get into telling folks how to run their business or starting Cain and Able at each other's throats
I will also say that by his posts over the years, I wish JDimmick's retail store were nearby as I would try to be in there weekly and buying if possible. Seems like a good guy with a good head on his shoulders!
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
<< <i>bah humbug, your obviously onesided
Yeah, I'm on the side that says a person who owns something can ask whatever he wants for it. And wait as long as he likes to sell it.
What side are you on?
<< <i>I do get it that there are all types of dealers. I am just getting at a bit of irony/confusion/non-understanding when I see/hear some say "it is important to turn inventory over in order not to be left holding the bag and have new products coming in", and what Jim said with "having cash for liquidity". >>
For the record, I wasn't talking to you, but addressing this point- if you own something that you think is not properly appreciated in the current market and you have the financial ability to hold onto it until such correction occurs, would it be odd not to?
I see this now and again, on ebay and at coin shows. My regular dealers turn their inventory over fairly regularly (or at least at appears that way based on what they display on their website).
On ebay, I often wonder if a dealer has forgotten that he has the coin listed or has sold it elsewhere and has not bothered to take down the listing. Perhaps it is, as others have suggested, that the dealer is using the coin to try to build a relationship. To me, it's a turn off.
At shows, I do see some coins over and over and over again. Some are tough sales (like a pattern that I have seen at a local show for several years running), and some are expensive coins with unrealistic price tags. Experienced sellers know how to get rid of these, if they want to do so, but for reasons that are unknown to me, the OP, Realone, and anyone else, they do not. It's their coin and their prerogative.
<< <i>
<< <i>I do get it that there are all types of dealers. I am just getting at a bit of irony/confusion/non-understanding when I see/hear some say "it is important to turn inventory over in order not to be left holding the bag and have new products coming in", and what Jim said with "having cash for liquidity". >>
For the record, I wasn't talking to you, but addressing this point- if you own something that you think is not properly appreciated in the current market and you have the financial ability to hold onto it until such correction occurs, would it be odd not to? >>
I don't disagree, but from many of the dealers, over the last 6+ years, that I have talked to, many have stated they would like the right price, but don't want to hold items too long. Theyy try to buy right in order to sell quickly. Holding for "the proper price" keeps capital tied up.
I guess there are more dealers, than I had thought, that are financially capable, and willing, to hold onto items and show them as "stale" (since they are advertised the entire time). I had thought it was like real estate....if you have a listing that has been there for a long time, the public looks at it as stale and starts wondering about issues with it. Thus making it harder to sell. I know I find myself in that camp at times.
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
<< <i>I am only interested in dealers that are interested in selling their coins, if they want to keep them forever they should start a collection and be honest about it. At least Doug Winter prices his coins fairly and to sell, and I believe is does quite well in doing so and is known to be one of the most successful coin dealers around. >>
And yet you seem to taking a swipe at somebody who doesn't fit your preconceived notion of what a dealer should be and do.
Why is that? I mean- if you're not interested in dealers unless they're like Doug Winters...
<< <i>Holding for "the proper price" keeps capital tied up. >>
I'm sure it does. But that doesn't change the fact that, even though nobody may know what it is, they can still have a good (enough for them) reason.
He made note that he believes many dealers believe that just because they paid x for the coin that somebody else somewhere down the rode will pay >x
Each is entitled to their own business models and that should be fine by everyone.
Lets just say that if their business model wasn't working for them they wouldn't be able to do continue doing it for to long.
<< <i>Which types of dealers hold non-selling products the longest? >>
Those with the most patience, the deepest pockets, or reasons which are not obvious to casual viewers who do not know them well.
In the last category might be that the coin in question is part of the dealer's collection which he is happy to keep, but willing to sell if he gets his number.
<< <i>
<< <i>Holding for "the proper price" keeps capital tied up. >>
I'm sure it does. But that doesn't change the fact that, even though nobody may know what it is, they can still have a good (enough for them) reason. >>
Let's take a hypothetical, say a dealer buys a coin for $1000. Just for fun, let's make two hypothetical choices:
a) sell for $1050 in one month (5% profit)
b) sell for $1250 in one year (25% profit)
The rate of return might seem quite a bit higher for choice A. The catch is replacing the inventory. What if the dealer knows that it is unlikely to find more inventory for a whole year? Then of course the better answer would be B. Obviously, dealers don't exactly know what price they can sell for and when, but experience gives them an indication. Let's add a third option:
c) sell for $1500 in three years (50% profit)
Again, if the dealer doesn't believe that he can replace the inventory at that quality and price level before three years, choice C would maximize his profit. There are dealers that operate with each of the stated models a, b, c. There is no right or wrong answer. There are dealers that are just as successful with C as with B or A.
Again, a dealer that carries a large retail inventory is going to tend to hold coins for longer time periods than dealers that keep a smallish inventory. A collector (or another dealer) that wants a particular coin today, might know to go to the dealer with the big inventory.
<< <i>
<< <i>Which types of dealers hold non-selling products the longest? >>
Those with the most patience, the deepest pockets, or reasons which are not obvious to casual viewers who do not know them well. >>
This, of course, doesn't stop casual viewers (some of them, anyway) from making it known that they don't think the dealer knows what he's doing, does it?
1-3 yrs unless you're doubling to tripling up doesn't make much sense.
One of my local dealer's inventory is basically unchanged from 2003-2005. And he has a shop that he pays for no less. I don't know how he
stays in business. It could be he is doing large bullion sales behind the scene but since there is so little classic US gold in the case (maybe half a dozen pieces)
you wouldn't think bullion in his forte either. He still carries the same dipped MS65 seated dime that a friend of mine sold him for $1200 back in 2003. That coin today
is worth about $600 and has grown spots from a bad dipping. I suspect he'll have that coin 5 yrs from now as well.
<< <i>
<< <i>Which types of dealers hold non-selling products the longest? >>
Those with the most patience, the deepest pockets, or reasons which are not obvious to casual viewers who do not know them well.
In the last category might be that the coin in question is part of the dealer's collection which he is happy to keep, but willing to sell if he gets his number. >>
Thank you for the simple, non-abrasive, response, John. And, yes, I do agree with the last category but had forgotten it and didn't mention it. That one is quite more understanding, to the general populace, I think.
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment