Dealer Buy Back
rkp
Posts: 449 ✭✭✭
Hi,
Over the past few years I've upgraded some of my coins so figured I would try and sell back some of the coins I no longer want, back to the dealers from whom I originally purchased them from. So I walked around the bourse at the Chicago ANA and offered the coins. I was a little surprised by some of the low offers which generally ranged from 40% to 75% of my purchase price. For some context, I am talking about slabbed, circulated bust and Barber dimes ranging in prices from nearly $200 to $400, and originally purchased in 2010 - 2011. Now, I understand that the series may have weakened over the past 3 years (although price guides/auctions don't bear that out) and these are not high dollar coins, but in general I was disappointed with the offers, even after presenting the original purchase receipt. The one exception was Glenn Holsonbake, who instantly offered 100% of my purchase price. So maybe my expectations were too high, but I guess I learned my lesson about certain dealers. What are your thoughts of a reasonable buy back percentage?
Thanks,
RKP
Over the past few years I've upgraded some of my coins so figured I would try and sell back some of the coins I no longer want, back to the dealers from whom I originally purchased them from. So I walked around the bourse at the Chicago ANA and offered the coins. I was a little surprised by some of the low offers which generally ranged from 40% to 75% of my purchase price. For some context, I am talking about slabbed, circulated bust and Barber dimes ranging in prices from nearly $200 to $400, and originally purchased in 2010 - 2011. Now, I understand that the series may have weakened over the past 3 years (although price guides/auctions don't bear that out) and these are not high dollar coins, but in general I was disappointed with the offers, even after presenting the original purchase receipt. The one exception was Glenn Holsonbake, who instantly offered 100% of my purchase price. So maybe my expectations were too high, but I guess I learned my lesson about certain dealers. What are your thoughts of a reasonable buy back percentage?
Thanks,
RKP
0
Comments
edited to add...
<< <i>So I walked around the bourse at the Chicago ANA... >>
How much do you suppose it costs a dealer to attend the ANA in order to be able to make an offer on your coins? I would bet a fair number of dealers attending would have to sell around $30-40k just to cover expenses.
<< <i>Hi,
Over the past few years I've upgraded some of my coins so figured I would try and sell back some of the coins I no longer want, back to the dealers from whom I originally purchased them from. So I walked around the bourse at the Chicago ANA and offered the coins. I was a little surprised by some of the low offers which generally ranged from 40% to 75% of my purchase price. For some context, I am talking about slabbed, circulated bust and Barber dimes ranging in prices from nearly $200 to $400, and originally purchased in 2010 - 2011. Now, I understand that the series may have weakened over the past 3 years (although price guides/auctions don't bear that out) and these are not high dollar coins, but in general I was disappointed with the offers, even after presenting the original purchase receipt. The one exception was Glenn Holsonbake, who instantly offered 100% of my purchase price. So maybe my expectations were too high, but I guess I learned my lesson about certain dealers. What are your thoughts of a reasonable buy back percentage?
Thanks,
RKP >>
I learned that lesson the hard way in 1980 from my local dealer. He wanted nothing to do with anything he had sold me over a 5 year period. He said he really didn't have any need
for them (ie no customers). There was just no offer at all. Most of these guys don't want to buy their stuff back at fair value. Better to buy from fresh J6P's who don't know the value of their coins and will sell to them dirt cheap. This is the best return of their capital (buy at 20-40%...sell at 90-120%). It requires a constant turnover of finding fresh marks and letting knowledgeable customers drift away. I know this doesn't apply to the sharpest dealers who have been on the national coin show circuit for 10-30 years....but it certainly applies to 70-90% of the two dozen or so local coin shops I have ever done business with. Big difference between fair and reasonable buy back prices. And it's highly dependent on the coin in question
i think it would be wise to word it a specific way.
say, "since i purchased these items from you, i thought i'd give you first opportunity to purchase them in case you have a good client base for them"
presentation can vastly affect outcomes.
i actually make it a point to not "return" or "sell back" an item but to trade for other stock, although as a percentage, that is pretty low.
i also hope you offered those items to other buyers on the floor.
now the obvious exception is if you are buying the upgrade from the same person you bought the other item from although no guarantee on repurchase price is in place depending on how long ago you bought the original item(s).
just my h10c
.
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SeaEagleCoins: 11/14/54-4/5/12. Miss you Larry!
We'll use our hands and hearts and if we must we'll use our heads.
<< <i>
<< <i>So I walked around the bourse at the Chicago ANA... >>
How much do you suppose it costs a dealer to attend the ANA in order to be able to make an offer on your coins? I would bet a fair number of dealers attending would have to sell around $30-40k just to cover expenses. >>
Oh WAH! In your way of thinking, they should also MARK UP their products when they attend the ANA to help cover expenses???
A good dealer will offer a buyback AT the ANA at the same, or very close to it, amount that they would back at their business (whether B&M or internet), imho. Obviously Glenn is a prime example of, not only a good but, a great dealer!
If they sell for a fair price and are good enough to have customers, particularly repeat customers, and they sell good product, then a good buyback should enable them to sell again. Of course, if they went to rip people off from the getgo, it is unlikely they want to risk a buy back....or they want it at a bargain basement price.
75-90% is generous for many/most coins...100% is awesome.
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>Hi,
Over the past few years I've upgraded some of my coins so figured I would try and sell back some of the coins I no longer want, back to the dealers from whom I originally purchased them from. So I walked around the bourse at the Chicago ANA and offered the coins. I was a little surprised by some of the low offers which generally ranged from 40% to 75% of my purchase price. For some context, I am talking about slabbed, circulated bust and Barber dimes ranging in prices from nearly $200 to $400, and originally purchased in 2010 - 2011. Now, I understand that the series may have weakened over the past 3 years (although price guides/auctions don't bear that out) and these are not high dollar coins, but in general I was disappointed with the offers, even after presenting the original purchase receipt. The one exception was Glenn Holsonbake, who instantly offered 100% of my purchase price. So maybe my expectations were too high, but I guess I learned my lesson about certain dealers. What are your thoughts of a reasonable buy back percentage?
Thanks,
RKP >>
Perhaps you should have followed the person who claimed this was a seller's show. I wonder if that meant that they were offering a generous 9% back of bid instead of the usual 10% or more.
<< <i>edited- nevermind. Some people couldn't find their own behind with both hands in broad daylight. >>
I have bought coins from you and have been happy, spit it out...
<< <i>AngelDees, Pinnacle Rarities and Mark Feld always paid 90% or more for buybacks from my own experience. In a couple cases higher. >>
I encountered a similar situation last year. Happy to report that AngelDees was fantastic. Not only did he remember me from 4 years earlier, he 100% covered my cost (with a flat market on that item).
The coin business is a business and has margins large enough to allow the dealers to cover their considerable expenses and still make a profit.
Setting up at a show like the ANA convention is an expensive proposition. Just think about the cost of transportation, hotels, security, food and table fees.
There is nothing new about this. It is just the way it is. Blame economic necessity.
When you are collecting low value coins much of the sale price is devoted to covering overhead expenses, not just the cost of the coin itself.
As the price of the coin increases the margin can, and with some of the better dealers does, come down.
Hoard the keys.
<< <i> The one exception was Glenn Holsonbake, who instantly offered 100% of my purchase price. >>
That was a very kind offer!
I do not expect anything like that from a coin dealer, it's just not a reasonable expectation but it says a lot that he offered 100%.
Latin American Collection
I was many more years a collector then I have been a dealer so I know how it feels on the other side of the table. While I am a small guy and have no control over the market and where prices go, I do pay attention to recent sales and cherish my long term relationships with my customers. I try hard to be fair and I think that is what anyone wants in a dealer. To be treated with respect and fairness.
On each individual coin offered to me, there is no magic number one way or another as to what I am able to pay. I take a look at recent sales if there are any, and come up with a number I hope works. Thank you for coming by the table and offering the coin. I appreciate the opportunity to do some business together!
Glenn
Website-Americana Rare Coin Inc
``https://ebay.us/m/KxolR5
I would say that it's the dealers during the end of bull cycles that cause most of the speculation, trading velocity, and flipping. At market cycle peaks the dealers are just
as non-committed as the collectors or speculators. Dealers also end up with their pants down and this is where numerous businesses fail (ie 2009-2011). I know the collector
base didn't double or triple during the last up cycle from 1997-2008. It sure seemed like the dealer base at least doubled. Everyone and their brother starts to become a dealer.
Key dates were one of the biggest speculations during the 2003-2008 run up. That wasn't caused by the ye old collector looking for one specimen for their set. That was the work
of dealers and advanced collectors who knew that if one key date was good, then half a dozen or more was even better. Those guys spun up the prices of 93-s Morgans, 09s vdb's, and
others. Dealers have the tendency to gear up their speculative efforts every time they see the money flow spigot into coins starting to open up. Of course, without those guys
speculating you'd probably never see rare coin prices rise as fast as they do. I suspect it's that way in art, antiques, classic cars, and other mainstream collectible fields that have been
around a long time.
Live and Learn.
PCGS Registries
Box of 20
SeaEagleCoins: 11/14/54-4/5/12. Miss you Larry!
It always makes sense to encourage long term buying on the part of the collector, but as we have seen, many dealers are short sighted and not particularly good businessmen. There are many business practices the some dealers engage in that reduce and limit their sales. Being in the business for many years does not mean you necessarily know how to maximize your profits and expand your customer base. We have all seen many examples of this... often in complaining threads...
<< <i>Many times at the POS they may offer to buy it back if you ever decide to sell. If they don't offer, it's a safe assumption that they aren't interested in buying it back; at least not at a price close to the sale price. >>
I would tend not to do regular business with dealers who sell coins which they would not be proud to have back in their inventory at a later point in time.
Latin American Collection
Collectors need to take responsibility in selling their material and getting the best price. If you don't like a dealer's buy back then shop it around the bourse or use the bay or teletrade. Coins are a hobby related retail business so a dealer is going to offer a price based on what it can be sold for (and realize plan ROI) and consider factors like turnover. Obviously slow turnover items will receive a lower offer.
I have had very few buy backs offered to me during my numismatic career. As I operate a business, my offer on any buyback is based on what I can sell it for and subject to the same criteria / offer as non buy backs. If your looking for loyalty, well go find a dog.
I remember in the 70s & 80s mostly dealers bought and sold coins from auction. Now a days, I think that a greater percentage of coins are bought and sold through auctions for dealers and collectors to remove the 50% offers. If you deal with reputable. honest dealers that you trust and have a relationship with then you will be happy when its time to sell.
<< <i>If your looking for loyalty, well go find a dog. >>
This has always been an issue for coin collectors and dealers, and I have been on both sides of the issue over the years.
When I was dealing in Colonial and early American coins and currency, I had a 100% buy back, because I sold neat items and would never have a problem reselling them if they came back to me. In many instances I actually made money on the 100% buy back due to the fact that prices had gone up on certain issues (i.e. large size Bust quarters in XF and better).
One problem that I had with the 100% buy back "privilege" is that one customer in particular was buying many nice coins, then returning them with increasing frequency. I think he was buying them, then trying to sell them to other dealers or collectors. Whatever he could not sell, he would just return. It was costly for me because I was spending time on the transactions (a lot of time) and there was no net profit. I eventually "had the talk" with him and the problem was solved.
At the company I work for now, we have a 90% to 100% buy back on non-bullion items.
<< <i>
<< <i>If your looking for loyalty, well go find a dog. >>
<< <i>Yes dealer buy backs can be shocking. Welcome to the rare coin industry. Coins are not items like stocks or bonds, they are collectibles. The value of a coin or piece of currency is what a willing buyer will pay at x point in time whether shop, bourse at show, or auction. As one in the business, I know that many coin and currency items have a slow turnover so I have to factor my offers accordingly. As a dealer, I have held some coins as long as ten years before I got my price.
Collectors need to take responsibility in selling their material and getting the best price. If you don't like a dealer's buy back then shop it around the bourse or use the bay or teletrade. Coins are a hobby related retail business so a dealer is going to offer a price based on what it can be sold for (and realize plan ROI) and consider factors like turnover. Obviously slow turnover items will receive a lower offer.
I have had very few buy backs offered to me during my numismatic career. As I operate a business, my offer on any buyback is based on what I can sell it for and subject to the same criteria / offer as non backs. If your looking for loyalty, well go find a dog. >>
Nice attitude mr carpet bagger. Given your dislike for collectors why are you a dealer anyway??
My Collection of Old Holders
Never a slave to one plastic brand will I ever be.
<< <i>Much depends upon the length of relationship and amount of business transacted with the dealer. It would be foolish not to accommodate a regular customer and potentially drive him away. On the other hand, if you had only bought one or two coins three years ago, it is an arms length transaction subject to the current market and demand for that particular coin.
It always makes sense to encourage long term buying on the part of the collector, but as we have seen, many dealers are short sighted and not particularly good businessmen. There are many business practices the some dealers engage in that reduce and limit their sales. Being in the business for many years does not mean you necessarily know how to maximize your profits and expand your customer base. We have all seen many examples of this... often in complaining threads... >>
The above is worth repeating. Different people often get different offers for the exact same coins. Many dealers understand that it is in their best interest to take care of their long term customers. On the other end of the spectrum, there are some dealers that routinely offer about 50% of the price they ask and will say what has been already said: "welcome to the coin business," when questioned about it. I would have guessed that 75% would be about average for the coins described. Perhaps the op bought too high, without much bargaining or shopping around. Perhaps the dealers don't see him/her as a valued customer. Perhaps, the story is being embellished to get more of a reaction on a forum. Perhaps some combination of those factors.
Eric
Selling to a dealer is just adding in a middleman. reduces your profit because they need to make a profit.
<< <i>I've never sought to offer coins I've bought back to the dealer I bought them from. It'd be like taking my car back to the dealer and asking them to buy it back.
Selling to a dealer is just adding in a middleman. reduces your profit because they need to make a profit. >>
WS
I suggest at least offering your coins back to the dealer you bought them from, but be willing to realize which dealers you will never want to go back to. I've certainly learned this the hard way and now have many blacklisted names.
The more interesting thing is being from a large, older company is buying back raw coins that we sold years ago. The one thing I will always do is honor the grade on the flip (if it is one of ours) whether I like it or not. Thats not to say people don't lose money especially on coins under $50 but they get a fair number. A couple recent examples were a bust dollar we had sold as XF40 harshly cleaned came back from NGC XF Details Repaired. The repair is small and I thought it had a shot of coming back problem free. I gave the customer my problem free and problem price up front so I will take a bit of a hit on this one. On the other hand I recently bought back a SLQ from a customer we had sold to him as a raw MS64. The coin was really nice and fresh so I paid him 50% over what he had paid while still honoring the grade. It now resides in an MS66 holder.
<< <i>
<< <i>Yes dealer buy backs can be shocking. Welcome to the rare coin industry. Coins are not items like stocks or bonds, they are collectibles. The value of a coin or piece of currency is what a willing buyer will pay at x point in time whether shop, bourse at show, or auction. As one in the business, I know that many coin and currency items have a slow turnover so I have to factor my offers accordingly. As a dealer, I have held some coins as long as ten years before I got my price.
Collectors need to take responsibility in selling their material and getting the best price. If you don't like a dealer's buy back then shop it around the bourse or use the bay or teletrade. Coins are a hobby related retail business so a dealer is going to offer a price based on what it can be sold for (and realize plan ROI) and consider factors like turnover. Obviously slow turnover items will receive a lower offer.
I have had very few buy backs offered to me during my numismatic career. As I operate a business, my offer on any buyback is based on what I can sell it for and subject to the same criteria / offer as non backs. If your looking for loyalty, well go find a dog. >>
Nice attitude mr carpet bagger. Given your dislike for collectors why are you a dealer anyway?? >>
LOL
The resell aspect of coins has always kept me from reaching and paying up. Those 2 ideas only help the dealer. I never offer coins to dealers as there is not a lot of reason to with other avenues to sell coins.
In a room full of dealers it only takes a show or 2 to figure out who to stay away from. IMO you got to be a die hard collector to put up with buying 1000 dollar coins that resell for 500 to 400 bucks back to dealers. IMO the young 20 to 30 year olds have very little intrest in coin collecting. The good old days are gone. Now info is everywhere and most are not willing to turn 100 dollar bills into 20's.
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working on proof shield nickels # 8 with a bullet!!!!
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<< <i>Now info is everywhere and most are not willing to turn 100 dollar bills into 20's. >>
If you're worrying about turning $20 bills in $100s (or the other way around), that would seem to indicate that you are an primarily an investor/speculator. Which in turn, would seem to indicate that you have an obligation to understand what your risks are when making a purchase just like you would when buying shares of stocks, not just buying coins because you like them.
But then, that's just me...
There's only been one case in the last five years where I haven't been able to honor this similar-price buyback. A few years ago, a customer had purchased a coin for $2100, which was Greysheet Ask at the time. A couple of years later, the customer wanted to re-sell the coin, after the recession had taken its toll on market levels. The Greysheet Ask on that coin is now around $1300, with auction results frequently in the $1100 range, and major wholesalers like Heritage paying around $1000. I explained the new market levels and offered to buy back the coin at the $1300 GS Ask price, or $200 above what I could buy another example at. Instead of appreciating my $1300 offer, he wondered how I could run a business by not standing behind my products, though with more profanity thrown in.
It's an unfortunate thing for a dealer to not stand behind their product (and there are some very visible dealers who are difficult to sell their own coins back to). It's quite a different thing altogether if the market changes in the interim. Nobody should expect a dealer to eat a large loss when the overall market has gone down. Did anyone get a full-price buyback offer on their stocks after the stock market crash a few years ago? Anybody getting any full-price refunds on the gold they bought at $1900? Market risk is something we all take when we buy an asset, rare coins included. Accept that market risk exists, and do business with people that stand behind their product.
I know this advice doesn't always hold true with rarities but it is good advice in my opinion. I don't always follow it but I do think about it when I make a purchase of a more common series such as Morgan dollars. I have some "mistake" coins that I know I will pay for it if I decide to sell them. I consider it tuition.
I have sat at a table listening to a another dealer friend practically begging a customer with a great eye to bring their bust coins to them first if they ever decide to sell. This customer only buys gems for the grade and they will get a great price.
<< <i>I only sell coins at retail that I would want to have in my inventory again. If I have a coin that I just want to go away never to return, I only sell it wholesale or through an auction house. >>
If all dealers had the same approach to their business, what would you do with the coins that you're currently wholesaling, that are not suitable for auction? Somebody has to deal with coins that need to go away, never to return.