@SurfinxHI said:
15) Color. I had a rack of color with me. I saw a lot of color. Most of it was priced into the mid 4 figures to low 5 figures for excellent examples. Stuff that was lesser quality was high 3 figures to low 4 figures. I don’t get it. Mine was priced way under those levels, still didn’t move, but got lots of compliments. Many were like “ my buyer can’t afford that,” I.e.,[b] “my buyer can’t afford the mark up I’m going to put on your piece and try to sell to him”.[/b] I wish those buyers were there!
Surf
Here's the part (I bolded it) that burns my butt......
IF, as a seller/dealer, you have a confirmed buyer, then WHY do you need to keep your original mark-up, which is usually figured in as holding material for a certain amount of time and finding a buyer?
For instance:
See nice toned morgan in ms64. Know there is interest, but no specific buyer. May have to hold anywhere from 1-180 days (pick a number, it doesn't matter). Price with 20% margin to cover costs and holding time.
That's fine. Understandable. Maybe it sells in 1 day and you give a 5% discount to a repeat customer (or maybe you don't). You score. Maybe it takes 180 days.
Or:
Same morgan, but you have a customer looking for that date/mm/look (you've worked with him before) and you are 95%+ certain he will buy it if priced right....you know his price range as you have worked with him.
Buy it, add 5%, he buys it immediately.
That's MY way of thinking. But, it sounds like the dealer(s) in question are still looking to put their "normal" markup on it, hence their customers don't even get a chance at the coins that those same dealers think the customers would want.
No "may I take a picture and send to my client?".
No nothing.
Sad
Hope the shows finishes strong for you
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
@SurfinxHI said:
15) Color. I had a rack of color with me. I saw a lot of color. Most of it was priced into the mid 4 figures to low 5 figures for excellent examples. Stuff that was lesser quality was high 3 figures to low 4 figures. I don’t get it. Mine was priced way under those levels, still didn’t move, but got lots of compliments. Many were like “ my buyer can’t afford that,” I.e.,[b] “my buyer can’t afford the mark up I’m going to put on your piece and try to sell to him”.[/b] I wish those buyers were there!
Surf
Here's the part (I bolded it) that burns my butt......
IF, as a seller/dealer, you have a confirmed buyer, then WHY do you need to keep your original mark-up, which is usually figured in as holding material for a certain amount of time and finding a buyer?
For instance:
See nice toned morgan in ms64. Know there is interest, but no specific buyer. May have to hold anywhere from 1-180 days (pick a number, it doesn't matter). Price with 20% margin to cover costs and holding time.
That's fine. Understandable. Maybe it sells in 1 day and you give a 5% discount to a repeat customer (or maybe you don't). You score. Maybe it takes 180 days.
Or:
Same morgan, but you have a customer looking for that date/mm/look (you've worked with him before) and you are 95%+ certain he will buy it if priced right....you know his price range as you have worked with him.
Buy it, add 5%, he buys it immediately.
That's MY way of thinking. But, it sounds like the dealer(s) in question are still looking to put their "normal" markup on it, hence their customers don't even get a chance at the coins that those same dealers think the customers would want.
No "may I take a picture and send to my client?".
No nothing.
Sad
Hope the shows finishes strong for you
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
@Kkathyl said:
From my perspective when I was able to go to the show on Saturday I seen many of the big guys packed up and left already. You had prime table locations with names like Heritage on it and an empty table. It makes you assume anything worth looking at is gone, or average Joe collector does not matter. Perhaps the Show coordinators should reconsider that strategy. Big guys taking prime locations then not caring is poor for the other dealers.
For better or worse, the big firms and the show circuit regulars pay the freight.
Clubs/show organizers often gotta beg the big money folks and certain top-notch specialists to put their show on the schedules of the big money and the specialists. The show circuit has a regular pattern (and conflicting dates too) and if your show doesn't fit the schedule of the top outfits, it's really hard to get them to your show. This was even more true a few years back, when there were more shows than now. Clubs/show organizers have limited leverage with many of the dealers, and that's the reality of it. Yes, the F.U.N. winter show is special, but the F.U.N. organization must sweat every year over the money part, I'll wager.
I am just grateful that small fry like me are still reasonably welcome. I am really happy to be asked for a fiver or even a ten spot for admission - these shows are expensive propositions and when I am able to attend, I am certainly willing to contribute to help keep them going.
The small fry like you is what makes this hobby. Don't let them fool you. If you or people like you were not there, there would be no show and no coin business as well. Coin dealers are lucky they have the "precious metal" content to fall back on. It will always bring buyers and sellers to the shows and shops regardless. I have had many dealers tell me if it wasn't for precious metals, they would have closed shop years ago.
@SurfinxHI said:
15) Color. I had a rack of color with me. I saw a lot of color. Most of it was priced into the mid 4 figures to low 5 figures for excellent examples. Stuff that was lesser quality was high 3 figures to low 4 figures. I don’t get it. Mine was priced way under those levels, still didn’t move, but got lots of compliments. Many were like “ my buyer can’t afford that,” I.e.,[b] “my buyer can’t afford the mark up I’m going to put on your piece and try to sell to him”.[/b] I wish those buyers were there!
Surf
Here's the part (I bolded it) that burns my butt......
IF, as a seller/dealer, you have a confirmed buyer, then WHY do you need to keep your original mark-up, which is usually figured in as holding material for a certain amount of time and finding a buyer?
For instance:
See nice toned morgan in ms64. Know there is interest, but no specific buyer. May have to hold anywhere from 1-180 days (pick a number, it doesn't matter). Price with 20% margin to cover costs and holding time.
That's fine. Understandable. Maybe it sells in 1 day and you give a 5% discount to a repeat customer (or maybe you don't). You score. Maybe it takes 180 days.
Or:
Same morgan, but you have a customer looking for that date/mm/look (you've worked with him before) and you are 95%+ certain he will buy it if priced right....you know his price range as you have worked with him.
Buy it, add 5%, he buys it immediately.
That's MY way of thinking. But, it sounds like the dealer(s) in question are still looking to put their "normal" markup on it, hence their customers don't even get a chance at the coins that those same dealers think the customers would want.
No "may I take a picture and send to my client?".
No nothing.
Sad
Hope the shows finishes strong for you
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
5% is not a killing. It is a loss.
Tell that to firms like Walmart. They took the high volume, low margin business and built an empire around it. The example above involved about 2 minutes of work because they had a known buyer. The point is, why not satisfy your customer who has the want list and forego the markup this time to build a stronger relationship? Makes sense to me based on the excellent example given.
I see both sides. Personally, 5% on a $1000 coin is enough to get lunch and dinner. 5% on a $100 is not so much. I think a variable percentage based on price and ease of resale is appropriate. Have a buyer for a $300 coin? Mark it up 10%, call it good. Have one for a $1000 coin? Maybe only 5%. No buyer on the horizon? Mark it up 40% and see if there is interest and bring it down if there is.
I’m sure there are many ways to skin this cat, but passing on a coin because you need to add a 49% mark up does seem like a good one. Eh, maybe it is for some. What do I know?
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
That is all good, but consider this:
Table fee will be $750
Airfare $500
Average hotel, not fancy for 4 nights $1,000
Add in ground transportation and misc. expenses $250
Total is $2,500
That is a very conservative number. I didn't add in food because he will have to eat anyway but you know it will be a lot more on the road. So, most dealers spent more at FUN than this example. So what does he need to break even?
That $2,500 total expense is 5% of $50,000. So, a dealer in this very conservative example needs to sell fifty thousand dollars just to break even.
Do you think it is possible that the dealers you are buying from are marking up their coins more than 5%?
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
That is all good, but consider this:
Table fee will be $750
Airfare $500
Average hotel, not fancy for 4 nights $1,000
Add in ground transportation and misc. expenses $250
Total is $2,500
That is a very conservative number. I didn't add in food because he will have to eat anyway but you know it will be a lot more on the road. So, most dealers spent more at FUN than this example. So what does he need to break even?
That $2,500 total expense is 5% of $50,000. So, a dealer in this very conservative example needs to sell fifty thousand dollars just to break even.
Do you think it is possible that the dealers you are buying from are marking up their coins more than 5%?
True.....but some dealers are selling $50k SINGLE coins......or $100K single coins....or $3K single coins. Easy to see how that could add up.
I think we are talking about apples and oranges to some degree. Again, 5% might be ok on a quick flip with a known buyer on the other end. Maybe 10-15% on a slightly longer term turn could happen. And who knows what the mark ups on the bigger guys are -- you have to think that if you are buying from Auction, there will be considerable add to the base price.
My guess is the average transaction for some of the medium to bigger players was $10-20K per transaction. And those happened multiple times per day, for 3 days!
@bestday said:
Sell at wholesale, buy retail for small dealers??.. worse some big guys try to Bs small dealers into selling even more under bid
good info
That is one thing I could never really get my head around. Vest pocket or dealers walking the floor always wanted to buy way back of bid, but looking through many of their boxes coins are priced "wholesale" more than I thought they were worth retail. You start to figure out who not to bother with after a while.
I see your point @SurfinxHI but I believe dealers making $10 & $20 thousand dollar deals have inventories of hundreds of thousands or more. And their expenses with that inventory, insurance, safes, etc. are multiples of the $2,500 example that I used. And I still believe most of their transactions are for more than a 5% mark-up.
But that is not the level of dealer I was referring to in my remark. I was thinking of "fun from the little guy's viewpoint" in the op. Most little guys at shows never touch fifty thousand dollars in sales. I can remember sitting behind a table on the last day of a show with a stupid grin on my face and thinking to myself, if I can sell just sell $200 before noon, I will have enough to pay for this table and lunch.
@SurfinxHI said:
15) Color. I had a rack of color with me. I saw a lot of color. Most of it was priced into the mid 4 figures to low 5 figures for excellent examples. Stuff that was lesser quality was high 3 figures to low 4 figures. I don’t get it. Mine was priced way under those levels, still didn’t move, but got lots of compliments. Many were like “ my buyer can’t afford that,” I.e.,[b] “my buyer can’t afford the mark up I’m going to put on your piece and try to sell to him”.[/b] I wish those buyers were there!
Surf
Here's the part (I bolded it) that burns my butt......
IF, as a seller/dealer, you have a confirmed buyer, then WHY do you need to keep your original mark-up, which is usually figured in as holding material for a certain amount of time and finding a buyer?
For instance:
See nice toned morgan in ms64. Know there is interest, but no specific buyer. May have to hold anywhere from 1-180 days (pick a number, it doesn't matter). Price with 20% margin to cover costs and holding time.
That's fine. Understandable. Maybe it sells in 1 day and you give a 5% discount to a repeat customer (or maybe you don't). You score. Maybe it takes 180 days.
Or:
Same morgan, but you have a customer looking for that date/mm/look (you've worked with him before) and you are 95%+ certain he will buy it if priced right....you know his price range as you have worked with him.
Buy it, add 5%, he buys it immediately.
That's MY way of thinking. But, it sounds like the dealer(s) in question are still looking to put their "normal" markup on it, hence their customers don't even get a chance at the coins that those same dealers think the customers would want.
No "may I take a picture and send to my client?".
No nothing.
Sad
Hope the shows finishes strong for you
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
5% is not a killing. It is a loss.
Tell that to firms like Walmart. They took the high volume, low margin business and built an empire around it. The example above involved about 2 minutes of work because they had a known buyer. The point is, why not satisfy your customer who has the want list and forego the markup this time to build a stronger relationship? Makes sense to me based on the excellent example given.
Wal-Mart has a gross margin in the 35% + range across all lines. Direct imported goods as high as 90%. After taxes, payroll, utilities etc, they bring about 5% to the bottom line.
They will occasionally promote high volume stuff like coke and Milk to get folks in the door and recoup it on the made in Vietnam dress that cost them $3 and retails for $30.
Known buyers tend to evaporate quickly. Maybe the wife put the kibosh on his hobby spending or he just didn't like the look of the coin in hand.
I took a case or two with a larger dealer at my first FUN shows. I made very few retail sales with that set-up and mostly used the cases as a home base for my inventory and want list buying on the floor. Back in ‘90s I used to hear a lot of grousing from some dealers about how Florida was filled with “old tire kickers who didn’t have much money.” I found that that was not really the case. If you had good coins, and priced them reasonably, you could do well.
In later years I rented my own booth and did much better, both in terms of retail and sales to other dealers. You need to build a name for yourself, and you need the exposure that a booth provides. Chances are you will never do that well when you are one of three or four dealers at a booth. Doing it by yourself or splitting it with one other person works much better.
Retired dealer and avid collector of U.S. type coins, 19th century presidential campaign medalets and selected medals. In recent years I have been working on a set of British coins - at least one coin from each king or queen who issued pieces that are collectible. I am also collecting at least one coin for each Roman emperor from Julius Caesar to ... ?
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
That is all good, but consider this:
Table fee will be $750
Airfare $500
Average hotel, not fancy for 4 nights $1,000
Add in ground transportation and misc. expenses $250
Total is $2,500
That is a very conservative number. I didn't add in food because he will have to eat anyway but you know it will be a lot more on the road. So, most dealers spent more at FUN than this example. So what does he need to break even?
That $2,500 total expense is 5% of $50,000. So, a dealer in this very conservative example needs to sell fifty thousand dollars just to break even.
Do you think it is possible that the dealers you are buying from are marking up their coins more than 5%?
I don't disagree. The original point was that you had a buyer in hand for one specific coin.
@SurfinxHI said:
15) Color. I had a rack of color with me. I saw a lot of color. Most of it was priced into the mid 4 figures to low 5 figures for excellent examples. Stuff that was lesser quality was high 3 figures to low 4 figures. I don’t get it. Mine was priced way under those levels, still didn’t move, but got lots of compliments. Many were like “ my buyer can’t afford that,” I.e.,[b] “my buyer can’t afford the mark up I’m going to put on your piece and try to sell to him”.[/b] I wish those buyers were there!
Surf
Here's the part (I bolded it) that burns my butt......
IF, as a seller/dealer, you have a confirmed buyer, then WHY do you need to keep your original mark-up, which is usually figured in as holding material for a certain amount of time and finding a buyer?
For instance:
See nice toned morgan in ms64. Know there is interest, but no specific buyer. May have to hold anywhere from 1-180 days (pick a number, it doesn't matter). Price with 20% margin to cover costs and holding time.
That's fine. Understandable. Maybe it sells in 1 day and you give a 5% discount to a repeat customer (or maybe you don't). You score. Maybe it takes 180 days.
Or:
Same morgan, but you have a customer looking for that date/mm/look (you've worked with him before) and you are 95%+ certain he will buy it if priced right....you know his price range as you have worked with him.
Buy it, add 5%, he buys it immediately.
That's MY way of thinking. But, it sounds like the dealer(s) in question are still looking to put their "normal" markup on it, hence their customers don't even get a chance at the coins that those same dealers think the customers would want.
No "may I take a picture and send to my client?".
No nothing.
Sad
Hope the shows finishes strong for you
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
5% is not a killing. It is a loss.
Tell that to firms like Walmart. They took the high volume, low margin business and built an empire around it. The example above involved about 2 minutes of work because they had a known buyer. The point is, why not satisfy your customer who has the want list and forego the markup this time to build a stronger relationship? Makes sense to me based on the excellent example given.
Wal-Mart has a gross margin in the 35% + range across all lines. Direct imported goods as high as 90%. After taxes, payroll, utilities etc, they bring about 5% to the bottom line.
They will occasionally promote high volume stuff like coke and Milk to get folks in the door and recoup it on the made in Vietnam dress that cost them $3 and retails for $30.
Known buyers tend to evaporate quickly. Maybe the wife put the kibosh on his hobby spending or he just didn't like the look of the coin in hand.
5% is dicey in the best of circumstances.
I agree with everything you are saying. I was just referring to buying a coin at 5% when you have a want list in hand versus passing. I would rather help my customer satisfy a want list than to stick to my normal margins. Call me crazy
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Show attendance is not cheap.
You are taking what I said WAY out of context and focusing on a minute part.
When the choice is 0% (don't buy it, don't sell it) or 5% (if it already has a buyer for it), then that would be more prudent and, yes, I believe a dealer COULD survive doing that (because they are likely doing the rest of the gig and buying, marking up their 20-30-50% or whatnot, and selling those as well).
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
That is all good, but consider this:
Table fee will be $750
Airfare $500
Average hotel, not fancy for 4 nights $1,000
Add in ground transportation and misc. expenses $250
Total is $2,500
That is a very conservative number. I didn't add in food because he will have to eat anyway but you know it will be a lot more on the road. So, most dealers spent more at FUN than this example. So what does he need to break even?
That $2,500 total expense is 5% of $50,000. So, a dealer in this very conservative example needs to sell fifty thousand dollars just to break even.
Do you think it is possible that the dealers you are buying from are marking up their coins more than 5%?
I don't disagree. The original point was that you had a buyer in hand for one specific coin.
Thank you and, yes, that was my original point and was just a number out of the air.......just based on Surf's mention of dealers saying they couldn't buy his stuff and sell to customers once they did THEIR markup (which is an unknown amount but seemed weird to hear).
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Show attendance is not cheap.
You are taking what I said WAY out of context and focusing on a minute part.
When the choice is 0% (don't buy it, don't sell it) or 5% (if it already has a buyer for it), then that would be more prudent and, yes, I believe a dealer COULD survive doing that (because they are likely doing the rest of the gig and buying, marking up their 20-30-50% or whatnot, and selling those as well).
Am I correct that we are talking uniquely tones coins? What is the crime in the dealer marking up the $1000 Morgan to $1100 rather than $1050? The appreciative long time customer should have no qualms with that.
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Show attendance is not cheap.
You are taking what I said WAY out of context and focusing on a minute part.
When the choice is 0% (don't buy it, don't sell it) or 5% (if it already has a buyer for it), then that would be more prudent and, yes, I believe a dealer COULD survive doing that (because they are likely doing the rest of the gig and buying, marking up their 20-30-50% or whatnot, and selling those as well).
Am I correct that we are talking uniquely tones coins? What is the crime in the dealer marking up the $1000 Morgan to $1100 rather than $1050? The appreciative long time customer should have no qualms with that.
There is nothing wrong with that. The problem is the dealer would rather pass on the $1000 coin since $1050/$1100 is too little even with an almost guaranteed buyer. If they can sell it for $1100, they want to buy it at $250-$500. If they pay $1000, they don’t think it will sell for $1500, so they decide it’s best to pass. I don’t understand why they would choose zero profit over a guaranteed $50-$100, but it is what it is.
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Show attendance is not cheap.
You are taking what I said WAY out of context and focusing on a minute part.
When the choice is 0% (don't buy it, don't sell it) or 5% (if it already has a buyer for it), then that would be more prudent and, yes, I believe a dealer COULD survive doing that (because they are likely doing the rest of the gig and buying, marking up their 20-30-50% or whatnot, and selling those as well).
Am I correct that we are talking uniquely tones coins? What is the crime in the dealer marking up the $1000 Morgan to $1100 rather than $1050? The appreciative long time customer should have no qualms with that.
There is nothing wrong with that. The problem is the dealer would rather pass on the $1000 coin since $1050/$1100 is too little even with an almost guaranteed buyer. If they can sell it for $1100, they want to buy it at $250-$500. If they pay $1000, they don’t think it will sell for $1500, so they decide it’s best to pass. I don’t understand why they would choose zero profit over a guaranteed $50-$100, but it is what it is.
I am a bit confused by the idea of the guaranteed or almost guaranteed buyer, particularly on uniquely toned coins which can be volatile in price. I get it if a good customer asks a dealer to pick up 20 MS Morgan's in MS 64 or even if the dealer forwarded an image of the coins (s) in question. Hanging on to a $1000 coin where much of the value is post mint doloration seems kind of risky with limited upside.
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Show attendance is not cheap.
You are taking what I said WAY out of context and focusing on a minute part.
When the choice is 0% (don't buy it, don't sell it) or 5% (if it already has a buyer for it), then that would be more prudent and, yes, I believe a dealer COULD survive doing that (because they are likely doing the rest of the gig and buying, marking up their 20-30-50% or whatnot, and selling those as well).
Am I correct that we are talking uniquely tones coins? What is the crime in the dealer marking up the $1000 Morgan to $1100 rather than $1050? The appreciative long time customer should have no qualms with that.
There is nothing wrong with that. The problem is the dealer would rather pass on the $1000 coin since $1050/$1100 is too little even with an almost guaranteed buyer. If they can sell it for $1100, they want to buy it at $250-$500. If they pay $1000, they don’t think it will sell for $1500, so they decide it’s best to pass. I don’t understand why they would choose zero profit over a guaranteed $50-$100, but it is what it is.
I am a bit confused by the idea of the guaranteed or almost guaranteed buyer, particularly on uniquely toned coins which can be volatile in price. I get it if a good customer asks a dealer to pick up 20 MS Morgan's in MS 64 or even if the dealer forwarded an image of the coins (s) in question. Hanging on to a $1000 coin where much of the value is post mint doloration seems kind of risky with limited upside.
It’s fairly easy now. Take a picture/video and send it to the potential buyer. If the buyer likes it, they PayPal you the money right away and you pay the original seller. There you have guaranteed profit. Otherwise I don’t know why the dealer would mention having a buyer ready (if the buyer might not like it, then that means you don’t have a buyer ready).
@Kkathyl said:
From my perspective when I was able to go to the show on Saturday I seen many of the big guys packed up and left already. You had prime table locations with names like Heritage on it and an empty table. It makes you assume anything worth looking at is gone, or average Joe collector does not matter. Perhaps the Show coordinators should reconsider that strategy. Big guys taking prime locations then not caring is poor for the other dealers.
If Heritage leaves, why can't other smaller dealers take the table? What good is an empty table to anyone?
Can a dealer survive on 5% on anything besides bullion and lot viewing for a bidder.
Show attendance is not cheap.
You are taking what I said WAY out of context and focusing on a minute part.
When the choice is 0% (don't buy it, don't sell it) or 5% (if it already has a buyer for it), then that would be more prudent and, yes, I believe a dealer COULD survive doing that (because they are likely doing the rest of the gig and buying, marking up their 20-30-50% or whatnot, and selling those as well).
Am I correct that we are talking uniquely tones coins? What is the crime in the dealer marking up the $1000 Morgan to $1100 rather than $1050? The appreciative long time customer should have no qualms with that.
Again, you are ignoring what I have written to support your own way of thinking.
I NEVER SAID there is anything wrong with any markup. I don't actually care.
What I DID SAY is that IF a dealer is saying they cannot buy a coin BECAUSE, once they made THEIR markup, they couldn't sell it to their customer, then I question WHY the dealer would seemingly be stuck on their normal markup instead of an easy payday (lesser amount) and a happy customer.
Why is that so hard for you to grasp in this instance? I said it that way originally, it was reiterated by someone else later, and then I said it again, which you, again, quoted.
Doesn't matter if it is uniquely toned or not. It is a coin that a dealer commented to another dealer (Surf) that he liked and basically had a customer for but that, once he added HIS markup, his customer couldn't afford it/buy it. He didn't say that at Surf's price the customer couldn't afford it. He said after HIS markup.
I don't recall anyone saying "an appreciative long time customer". Just "a customer". Also, why is it, in your mind, so 1-sided?
That has me questioning why a dealer, with a customer inhand, wouldn't lower his markup for a quick resale, a few bucks, and a happy customer. Simple? I honestly thought it was simple. No need to try to add a lot of variables as I honestly think the simple scenario is really simple.
Not so sure why my simple scenario is so hard to grasp......
@Kkathyl said:
From my perspective when I was able to go to the show on Saturday I seen many of the big guys packed up and left already. You had prime table locations with names like Heritage on it and an empty table. It makes you assume anything worth looking at is gone, or average Joe collector does not matter. Perhaps the Show coordinators should reconsider that strategy. Big guys taking prime locations then not caring is poor for the other dealers.
If Heritage leaves, why can't other smaller dealers take the table? What good is an empty table to anyone?
I agree with your statement. Only thing I could think of would be maybe the dealer(s) wants the sign left up for advertising purposes?
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Yes - they can survive because the next time I go to buy a coin, i will be seeing them first. Build a relationship and have excellent customer service and your business will flourish. Think about the long term relationship. I buy the majority of my coins from the same few dealers because of the relationship and trust they have built with me. They don't need to make a killing on every sale with me because they know I will be back many times in the future.
5% is not a killing. It is a loss.
The small fry like you is what makes this hobby. Don't let them fool you. If you or people like you were not there, there would be no show and no coin business as well. Coin dealers are lucky they have the "precious metal" content to fall back on. It will always bring buyers and sellers to the shows and shops regardless. I have had many dealers tell me if it wasn't for precious metals, they would have closed shop years ago.
Tell that to firms like Walmart. They took the high volume, low margin business and built an empire around it. The example above involved about 2 minutes of work because they had a known buyer. The point is, why not satisfy your customer who has the want list and forego the markup this time to build a stronger relationship? Makes sense to me based on the excellent example given.
I see both sides. Personally, 5% on a $1000 coin is enough to get lunch and dinner. 5% on a $100 is not so much. I think a variable percentage based on price and ease of resale is appropriate. Have a buyer for a $300 coin? Mark it up 10%, call it good. Have one for a $1000 coin? Maybe only 5%. No buyer on the horizon? Mark it up 40% and see if there is interest and bring it down if there is.
I’m sure there are many ways to skin this cat, but passing on a coin because you need to add a 49% mark up does seem like a good one. Eh, maybe it is for some. What do I know?
That is all good, but consider this:
Table fee will be $750
Airfare $500
Average hotel, not fancy for 4 nights $1,000
Add in ground transportation and misc. expenses $250
Total is $2,500
That is a very conservative number. I didn't add in food because he will have to eat anyway but you know it will be a lot more on the road. So, most dealers spent more at FUN than this example. So what does he need to break even?
That $2,500 total expense is 5% of $50,000. So, a dealer in this very conservative example needs to sell fifty thousand dollars just to break even.
Do you think it is possible that the dealers you are buying from are marking up their coins more than 5%?
True.....but some dealers are selling $50k SINGLE coins......or $100K single coins....or $3K single coins. Easy to see how that could add up.
I think we are talking about apples and oranges to some degree. Again, 5% might be ok on a quick flip with a known buyer on the other end. Maybe 10-15% on a slightly longer term turn could happen. And who knows what the mark ups on the bigger guys are -- you have to think that if you are buying from Auction, there will be considerable add to the base price.
My guess is the average transaction for some of the medium to bigger players was $10-20K per transaction. And those happened multiple times per day, for 3 days!
Great thread!
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Sell at wholesale, buy retail for small dealers??.. worse some big guys try to Bs small dealers into selling even more under bid
good info
That is one thing I could never really get my head around. Vest pocket or dealers walking the floor always wanted to buy way back of bid, but looking through many of their boxes coins are priced "wholesale" more than I thought they were worth retail. You start to figure out who not to bother with after a while.
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I see your point @SurfinxHI but I believe dealers making $10 & $20 thousand dollar deals have inventories of hundreds of thousands or more. And their expenses with that inventory, insurance, safes, etc. are multiples of the $2,500 example that I used. And I still believe most of their transactions are for more than a 5% mark-up.
But that is not the level of dealer I was referring to in my remark. I was thinking of "fun from the little guy's viewpoint" in the op. Most little guys at shows never touch fifty thousand dollars in sales. I can remember sitting behind a table on the last day of a show with a stupid grin on my face and thinking to myself, if I can sell just sell $200 before noon, I will have enough to pay for this table and lunch.
Wal-Mart has a gross margin in the 35% + range across all lines. Direct imported goods as high as 90%. After taxes, payroll, utilities etc, they bring about 5% to the bottom line.
They will occasionally promote high volume stuff like coke and Milk to get folks in the door and recoup it on the made in Vietnam dress that cost them $3 and retails for $30.
Known buyers tend to evaporate quickly. Maybe the wife put the kibosh on his hobby spending or he just didn't like the look of the coin in hand.
5% is dicey in the best of circumstances.
I took a case or two with a larger dealer at my first FUN shows. I made very few retail sales with that set-up and mostly used the cases as a home base for my inventory and want list buying on the floor. Back in ‘90s I used to hear a lot of grousing from some dealers about how Florida was filled with “old tire kickers who didn’t have much money.” I found that that was not really the case. If you had good coins, and priced them reasonably, you could do well.
In later years I rented my own booth and did much better, both in terms of retail and sales to other dealers. You need to build a name for yourself, and you need the exposure that a booth provides. Chances are you will never do that well when you are one of three or four dealers at a booth. Doing it by yourself or splitting it with one other person works much better.
@SurfinxHI, thank you for your report. I really enjoyed reading the show from your perspective.
1TwoBits
I don't disagree. The original point was that you had a buyer in hand for one specific coin.
I agree with everything you are saying. I was just referring to buying a coin at 5% when you have a want list in hand versus passing. I would rather help my customer satisfy a want list than to stick to my normal margins. Call me crazy
You are taking what I said WAY out of context and focusing on a minute part.
When the choice is 0% (don't buy it, don't sell it) or 5% (if it already has a buyer for it), then that would be more prudent and, yes, I believe a dealer COULD survive doing that (because they are likely doing the rest of the gig and buying, marking up their 20-30-50% or whatnot, and selling those as well).
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
Thank you and, yes, that was my original point and was just a number out of the air.......just based on Surf's mention of dealers saying they couldn't buy his stuff and sell to customers once they did THEIR markup (which is an unknown amount but seemed weird to hear).
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
Am I correct that we are talking uniquely tones coins? What is the crime in the dealer marking up the $1000 Morgan to $1100 rather than $1050? The appreciative long time customer should have no qualms with that.
There is nothing wrong with that. The problem is the dealer would rather pass on the $1000 coin since $1050/$1100 is too little even with an almost guaranteed buyer. If they can sell it for $1100, they want to buy it at $250-$500. If they pay $1000, they don’t think it will sell for $1500, so they decide it’s best to pass. I don’t understand why they would choose zero profit over a guaranteed $50-$100, but it is what it is.
I am a bit confused by the idea of the guaranteed or almost guaranteed buyer, particularly on uniquely toned coins which can be volatile in price. I get it if a good customer asks a dealer to pick up 20 MS Morgan's in MS 64 or even if the dealer forwarded an image of the coins (s) in question. Hanging on to a $1000 coin where much of the value is post mint doloration seems kind of risky with limited upside.
It’s fairly easy now. Take a picture/video and send it to the potential buyer. If the buyer likes it, they PayPal you the money right away and you pay the original seller. There you have guaranteed profit. Otherwise I don’t know why the dealer would mention having a buyer ready (if the buyer might not like it, then that means you don’t have a buyer ready).
If Heritage leaves, why can't other smaller dealers take the table? What good is an empty table to anyone?
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@basetsb it would of been better if they had taken the sign down and let others expand the tables. Agree 100%
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Again, you are ignoring what I have written to support your own way of thinking.
I NEVER SAID there is anything wrong with any markup. I don't actually care.
What I DID SAY is that IF a dealer is saying they cannot buy a coin BECAUSE, once they made THEIR markup, they couldn't sell it to their customer, then I question WHY the dealer would seemingly be stuck on their normal markup instead of an easy payday (lesser amount) and a happy customer.
Why is that so hard for you to grasp in this instance? I said it that way originally, it was reiterated by someone else later, and then I said it again, which you, again, quoted.
Doesn't matter if it is uniquely toned or not. It is a coin that a dealer commented to another dealer (Surf) that he liked and basically had a customer for but that, once he added HIS markup, his customer couldn't afford it/buy it. He didn't say that at Surf's price the customer couldn't afford it. He said after HIS markup.
I don't recall anyone saying "an appreciative long time customer". Just "a customer". Also, why is it, in your mind, so 1-sided?
That has me questioning why a dealer, with a customer inhand, wouldn't lower his markup for a quick resale, a few bucks, and a happy customer. Simple? I honestly thought it was simple. No need to try to add a lot of variables as I honestly think the simple scenario is really simple.
Not so sure why my simple scenario is so hard to grasp......
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
Been self employed since 1982. Easy paydays rarely if ever exist.
Tough concept to grasp for the cubicle dwellers.
Great report thanks for sharing.
Excellent report from a perspective we don't often see. Thanks!
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https://pcgs.com/setregistry/collectors-showcase/classic-issues-colonials-through-1964/zambezi-collection-trade-dollars/7345Asesabi Lutho
A lot of the intricate ins and outs of making a living dealing coins presented here, thanks
I think I will keep my day job
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I agree with your statement. Only thing I could think of would be maybe the dealer(s) wants the sign left up for advertising purposes?