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Analysis of a coin deal - part 2
3sidesofsilver
Posts: 282 ✭✭✭
I walk into a dealers store 2 months ago with an 1881-CC Morgan, PCGS MS-65. He looks it over and says "I would be at $475 for this coin, best I can offer". I thank him for the offer, but tell him I'd need more than that, take my coin and leave. Happens all the time. Dealer offered his best price, wasn't close to mine, so no deal happened. Actually, not really newsworthy, but sometimes the deal is no deal at all.
--Craig
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There are dozens, if not hundreds, of potential reasons that particular dealer might not have been all that interested in that particular coin on that particular day.
Authorized dealer for PCGS, PCGS Currency, NGC, NCS, PMG, CAC. Member of the PNG, ANA. Member dealer of CoinPlex and CCE/FACTS as "CH5"
Coin was offered. Amount was offered. Amount was declined. Coin left in OP's hands just as it walked in.
No other details offered and no analysis offered.
Seems pretty common to me.
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 walk into a dealers store 2 months ago with an 1881-CC Morgan, PCGS MS-65. He looks it over and says "I would be at $475 for this coin, best I can offer". I thank him for the offer, but tell him I'd need more than that, take my coin and leave. Happens all the time. Dealer offered his best price, wasn't close to mine, so no deal happened. Actually, not really newsworthy, but sometimes the deal is no deal at all. >>
Did this really happen or is this a hypothetical to generate some discussion? If it really happened, why not offer it on the BST with your asking price?
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
Sometimes unrealistic expectations are on both sides of the deal.
Knowledge is the enemy of fear
• Many dealers have specialties and strengths and weaknesses. Not every dealer has a strong market position in Morgan dollars. Sometimes a dealer has to wholesale a piece to dispose of it because he does not have retail customers. Therefore he can't pay you top dollar. That is why knowing the nature of a dealer's market position is important when you consider to whom to offer a coin.
For example Tom Reynolds is a well known major dealer in early U.S. copper coinage. If you have large cents he might be a strong buyer. If you have Morgan dollars his interest would probably be quite low.
• Was the 1881-CC dollar you were offering a strong MS-65, "A" coin? Was an average "B" coin, or was it a low end "C" coin? These things matter especially with the influence that CAC now has on the market. The MS-65 bid is $810. The MS-64 bid is $535. A "C" coin might not be worth much more than $550. I have also noted that sometimes CC dollars have gotten a pass when it comes to grading. I don't think that the standards should be lower just because the Carson City mint made the dollar, but there have been periods when that seemed to be the case.
• Many collectors think that they should be able to buy coins from dealers at the Gray Sheet bid price or even less. If that is so then the dealer can't pay you the bid price for the coin. To put it another way, do you work at your job for 10 cents an hour? Why do you expect the dealer to work for nothing?
RAD#306
It's also very possible said dealers are VERY interested to get the coin at the supposed low-ball price. In fact they might be very happy doing so and do it all the time.
of most B&M's, better to low ball as there's little chance they want anything where they can only achieve a small markup (ie less than 15-20%). My own shop is "pretty ethical." But, if you have really valuable numismatic
coins and don't know it, odds are you will get offered 20c to 40c on the dollar. That's just how it works most of the time. There's also less chance of an uninformed buyer walking away from a low-ball than walking away from
a high-ball offer. Go ahead and tell your customer they have 4 coins worth $80K to $100K. They'll walk out to see if the next guy can beat that. Now if you tell them they have $25K worth of coins, there's a much better
chance you'll get the deal. Sad to say, that method works. I've rarely attempted to sell any worthwhile gem US coins to local shops because I know they cannot possibly pay what the larger national retailers and wholesalers
pay out. Why beat your head against a wall? In fact, the more nice stuff you show them (ie educate them) the less chance you have of buying something similar if it ever walks into the shop.
<< <i>The low ball price works quite often on those who don't know that they have. To purchase from someone who knows what they have requires investing one's money at a much lower Rate of Return. From what I've seen
of most B&M's, better to low ball as there's little chance they want anything where they can only achieve a small markup (ie less than 15-20%). My own shop is "pretty ethical." But, if you have really valuable numismatic
coins and don't know it, odds are you will get offered 20c to 40c on the dollar. That's just how it works most of the time. There's also less chance of an uninformed buyer walking away from a low-ball than walking away from
a high-ball offer. Go ahead and tell your customer they have 4 coins worth $80K to $100K. They'll walk out to see if the next guy can beat that. Now if you tell them they have $25K worth of coins, there's a much better
chance you'll get the deal. Sad to say, that method works. I've rarely attempted to sell any worthwhile gem US coins to local shops because I know they cannot possibly pay what the larger national retailers and wholesalers
pay out. Why beat your head against a wall? In fact, the more nice stuff you show them (ie educate them) the less chance you have of buying something similar if it ever walks into the shop. >>
Um, thanks?! Points for honesty.
<< <i>It is truly not my intent to sound rude, but what's the point?
There are dozens, if not hundreds, of potential reasons that particular dealer might not have been all that interested in that particular coin on that particular day. >>
Exactly.
Most B & M Shops have a customer base that they service and that customer base probably would not have accommodated that particular dealer. This means that the dealer would have had to sit on the coin until the opportunity presented itself to move it.
Generally speaking, a high price "might" be offered if the coin was able to be sold the following day.
The name is LEE!
<< <i>True story that actually happened; not hypothetical for discussion. I would have taken anything north of $675, which was the case when I did finally sell it. It was a typical well struck, mark free, and lustrous 1881, so a B coin I would call it. >>
Coin dealers are one of the very few businesses that will make offers on what individuals want to sell. Walmart, Barnes and Noble and Kroger certainly do not. Fair price for him to resell the coin is about $800, so the $675 that you were seeking was too low for most dealers.
Though his offer was less than I would have made, I don't have the building, lights and a tawdry Christmas party to pay for.
<< <i>I walk into a dealers store 2 months ago with an 1881-CC Morgan, PCGS MS-65. He looks it over and says "I would be at $475 for this coin, best I can offer". I thank him for the offer, but tell him I'd need more than that, take my coin and leave. Happens all the time. Dealer offered his best price, wasn't close to mine, so no deal happened. Actually, not really newsworthy, but sometimes the deal is no deal at all. >>
CDN Greysheet Bid is $810 - he offered you 59% of Bid. He is probably planning on flpping it around bid on the Bay. He is not a buyer unless he can get it way below bid and make a nice instant profit. Or he may just put a price sticker on it at $935 Krause Retail and put it in his glass case in the shop. Way to go in walking away.
<< <i>
<< <i>True story that actually happened; not hypothetical for discussion. I would have taken anything north of $675, which was the case when I did finally sell it. It was a typical well struck, mark free, and lustrous 1881, so a B coin I would call it. >>
Coin dealers are one of the very few businesses that will make offers on what individuals want to sell. Walmart, Barnes and Noble and Kroger certainly do not. Fair price for him to resell the coin is about $800, so the $675 that you were seeking was too low for most dealers.
Though his offer was less than I would have made, I don't have the building, lights and a tawdry Christmas party to pay for. >>
??
In your opinion fair resell price on this scenario is $800 so you can somehow relate to his offer of $475?
Roadrunner was most honest about the B&M dealers' hose-first-ask-questions-later philosophy.
<< <i>I always get a kick out of all the folks that say when a dealer might offer a low-ball offer...... they are not interested in the coin or it might not be their specialty etc.
It's also very possible said dealers are VERY interested to get the coin at the supposed low-ball price. In fact they might be very happy doing so and do it all the time.
IF, that were the case, I would think that the dealer would have countered.
I happen to think that the dealer just would not have wanted to "carry" the coin unless it was at his price. And he might have had to carry it for quite a while.
The name is LEE!
<< <i>
<< <i>
<< <i>True story that actually happened; not hypothetical for discussion. I would have taken anything north of $675, which was the case when I did finally sell it. It was a typical well struck, mark free, and lustrous 1881, so a B coin I would call it. >>
Coin dealers are one of the very few businesses that will make offers on what individuals want to sell. Walmart, Barnes and Noble and Kroger certainly do not. Fair price for him to resell the coin is about $800, so the $675 that you were seeking was too low for most dealers.
Though his offer was less than I would have made, I don't have the building, lights and a tawdry Christmas party to pay for. >>
??
In your opinion fair resell price on this scenario is $800 so you can somehow relate to his offer of $475?
Roadrunner was most honest about the B&M dealers' hose-first-ask-questions-later philosophy. >>
Like I said, I would have offered more, probably $650. Point is, many collectors believe that every dealer should offer a tight spread on every series. Virtually all do on Bullion related items. Offer was at the low side and the OP decided to walk. No problem there.
He is allowed and ENCOURAGED to offer you what he thinks he can, you are allowed and ENCOURAGED to say no when you do not like what he says.
It did not sound like you were real interested in selling it anyway. The assumption is the guy knows what he can get the coins for and what he can sell them for.
<< <i>The low ball price works quite often on those who don't know that they have. To purchase from someone who knows what they have requires investing one's money at a much lower Rate of Return. From what I've seen
of most B&M's, better to low ball as there's little chance they want anything where they can only achieve a small markup (ie less than 15-20%). My own shop is "pretty ethical." But, if you have really valuable numismatic
coins and don't know it, odds are you will get offered 20c to 40c on the dollar. That's just how it works most of the time. There's also less chance of an uninformed buyer walking away from a low-ball than walking away from
a high-ball offer. Go ahead and tell your customer they have 4 coins worth $80K to $100K. They'll walk out to see if the next guy can beat that. Now if you tell them they have $25K worth of coins, there's a much better
chance you'll get the deal. Sad to say, that method works. I've rarely attempted to sell any worthwhile gem US coins to local shops because I know they cannot possibly pay what the larger national retailers and wholesalers
pay out. Why beat your head against a wall? In fact, the more nice stuff you show them (ie educate them) the less chance you have of buying something similar if it ever walks into the shop. >>
Unfortunately this is true. You can offer too much for a coin, and either scare the person away or make them greedy.
<< <i>
<< <i>The low ball price works quite often on those who don't know that they have. To purchase from someone who knows what they have requires investing one's money at a much lower Rate of Return. From what I've seen
of most B&M's, better to low ball as there's little chance they want anything where they can only achieve a small markup (ie less than 15-20%). My own shop is "pretty ethical." But, if you have really valuable numismatic
coins and don't know it, odds are you will get offered 20c to 40c on the dollar. That's just how it works most of the time. There's also less chance of an uninformed buyer walking away from a low-ball than walking away from
a high-ball offer. Go ahead and tell your customer they have 4 coins worth $80K to $100K. They'll walk out to see if the next guy can beat that. Now if you tell them they have $25K worth of coins, there's a much better
chance you'll get the deal. Sad to say, that method works. I've rarely attempted to sell any worthwhile gem US coins to local shops because I know they cannot possibly pay what the larger national retailers and wholesalers
pay out. Why beat your head against a wall? In fact, the more nice stuff you show them (ie educate them) the less chance you have of buying something similar if it ever walks into the shop. >>
Unfortunately this is true. You can offer too much for a coin, and either scare the person away or make them greedy. >>
You have a twisted metric for determining the "greedy" party here.
In this scenario even offering too much is in reality too little. And scaring a potential seller away involves educating him about fair prices.