How to define 'Wholesale' versus 'Retail'

stevepk · May 7, 2015 3:53AM

How do you define paying wholesale versus retail? If I understand correctly, dealers pay wholesale and collectors pay retail. Does this mean dealers always pay wholesale and collectors never have opportunities to buy at wholesale prices? It has been mentioned several times on this forum that a common mistake among collectors is to expect to pay retail, sell at wholesale, and expect to break even in the long run. As a collector, should I assume I am paying retail prices? What guideline establishes wholesale versus retail? The Greysheet I am sure is the standard, but even this is flawed. There are numerous examples of classic era eye appealing coins that cannot be purchased at Greysheet values, even by dealers. Are Heritage Auction achieves considered wholesale, even with the buyer premium? Do dealers get special treatment at coin shows with better prices than those offered to collectors? Is there a secret handshake to acknowledge a wholesale transaction?

My perception of retail is a brick and mortar coin shop or a dealer website at listed sale prices prior to any negotiation. Prices at a coin show are typically a bit less than online or coin shop prices. I view the coin show as a wholesale / retail hybrid with a fair share of hits and misses. Coin shops and dealer online inventories are retail, and Heritage auctions or Greysheet are wholesale. Collectors have access to coin shows and auctions just like dealers, so every once in a while, a collector has an opportunity to buy quality material at wholesale or near wholesale prices.

Is this an accurate assessment?

s4ny · May 7, 2015 4:04AM

Best I can do is buy wholesale and sell wholesale. I can buy wholesale if
I buy coins from a private seller. I have done this numerous times on Craigslist.

I have also sold on Craigslist and realize that I am selling wholesale when I make those
sales.

When I buy or sell on eBay, I feel that I am not transacting business at retail or wholesale,
but rather closer to the midpoint. The eBay and PayPal fees make it closer to retail if
I buy, wholesale if I sell.

If I buy at a show, I can try to buy for less than retail, but it will be closer to
retail than wholesale.

dib · May 7, 2015 4:05AM

Heritage = retail +

BustHalfBrian · May 7, 2015 4:28AM

wholesale = dealer prices
retail = customer (public) prices

In a nutshell. Those terms are really just a guideline to indicate the hierarchy of sales.

TopographicOceans · May 7, 2015 4:43AM

Retail is what I pay for a coin.
Wholesale is what I wish I could have got from the nice people on eBay.

Davideo · May 7, 2015 4:54AM

The coin market is a bit unusual compared to most and so the wholesale vs retail gets sort of murky. The more common use case that sort of applies to coins would be the bullion dealers getting ASEs for wholesale from the mint and then selling for retail. Typically wholesale prices are for purchasing a quantity order from a manufacturer or distributor. This doesn't apply for most of the coin market.

BryceM · May 7, 2015 4:56AM

The terms are most appropriate to the commerce of large numbers of newly manufactured items. In that arena the economy of scale is important. In the Internet age, sale & distribution patterns for unique, collectible items are poorly described by these terms.

Maybe the best you can do is to state that wholesale is what a dealer would be willing to pay for something, considering he needs to sell it at an even higher price to make a profit. Retail is what a person might pay to acquire an item irrespective of the need to make a profit. The person with the best exposure to large quantities of material is in the best position to act when good buying opportunities arise. Those of us with time requirements in other areas have fewer opportunities and are therefore more subject to "retail" pricing. Dealers are also happy to acquire anything they can make a profit on while collectors are usually further restrained by narrow want lists.

Price guides & greysheets are very loose interpretations of trends and don't reflect reality in many cases.

joebb21 · May 7, 2015 6:12AM

I just look at it many times from the profit margin.

I buy x coin for $500. I know I can easily go to another dealer and sell the coin for say $525 but instead of flipping this coin easily I hold out for more money-say $550. This transaction I call retail.

Wholesale is the price that moves the coin very quickly while retail may take a little longer but gets you more.

The only question now is if my retail is considered your wholesale or the other way around-

I have bought coins for a large premium over generic for the date/grade (another dealers retail) but have been able to wholesale/retail it shortly after.

Ultimately what it comes down to for me is price. If its fair and inline with my evaluation for it- I buy it.
If its not- I pass.

I dont care whether they think I am the wholesale or retail client. I know Im the happy client

MrEureka · May 7, 2015 6:44AM

An old article on the subject, but still relevant.

vplite · May 7, 2015 6:46AM

Most collectors buy retail and sell wholesale. That's why you don't collect coins as an "investment".

CoinRaritiesOnline · May 7, 2015 6:53AM

I don't think these terms have much meaning in the coin business, and I wouldn't spend much time worrying about it.

roadrunner · May 7, 2015 7:39AM

They really have no meaning today. You can pay "retail" on a coin and go out and double your money. So, how could that have been retail. And you can pay "wholesale" for something and lose 20-50%. So how could that be wholesale.

If you end making money on a short term transaction, figure you got that coin for less than it was worth (ie wholesale).

There are dozens of ways to price a coin. But there's only way to make money and one way to lose money. That is, you sell if for more than you paid or less than you paid. That's wholesale/retail.

AMRC · May 7, 2015 8:00AM

<< I don't think these terms have much meaning in the coin business, and I wouldn't spend much time worrying about it. >>

Exactly.

Think of it like this, if a dealer buys it to resell it is wholesale if an end collector buys it, it is a retail transaction. In this business, it has very little to do with the price in relation to some perceived value.

AMRC · May 7, 2015 8:01AM

<< Heritage = retail + >>

If this was true, then dealers would not be buying at Heritage auctions would they?

steveben · May 7, 2015 8:33AM

Please tell me where I can get rare original gold coins for wholesale. Thanks!

ebaybuyer · May 7, 2015 9:11AM

a good idea to define what types of coins are sold at the wholesale level, those hoping to buy choice original scarce coins at wholesale levels are dreaming plain and simple unless you are buying the loot from a robbery

dib · May 7, 2015 10:09AM

<< 

<< Heritage = retail + >>

If this was true, then dealers would not be buying at Heritage auctions would they? >>

Dealers/collectors wouldn't pay the hefty fees to consign with Heritage if their prices realized were wholesale like the OP said, or would they?

Shortgapbob · May 7, 2015 10:25AM

In addition to what has been said, I think part of the difference is with services offered. A wholesale price is lower, but is a "done deal" fast transaction situation. Retail usually allows for return privledges, layaway terms, want list servicing, time to educate the customer, etc.

Part of "retail" pricing accounts for these included services.

TwoSides2aCoin · May 7, 2015 10:30AM

Wholesale is marked down for resell
Retail is marked up for E-Sale

Scary they both sound the same in the end.

DeepCoin · May 7, 2015 10:55AM

The more a coin is a commodity, i.e. generic MS63 Morgan for example, the more the collector will be at a disadvantage when selling and buying. The greater the rarity, the more the spread decreases in the favor of the collector IMHO. Also, the desirability of the series in question also adds to the complexity of this. I would argue that a collector selling a 3CN IN MS will have more difficulty getting a better deal than one who has a Bust Half in AU (PCGS grading of course).

Coinosaurus · May 7, 2015 11:00AM

<< Please tell me where I can get rare original gold coins for wholesale. Thanks! >>

You have to hit the bourse floor at the right time on the one day of the year that dealer X decides to thin their inventory. It happens, you just have to hustle.

AUandAG · May 7, 2015 11:05AM

Just follow what I do:

Buy at retail.
Sell at wholesale.

Make the money on the spread.

bob

ricko · May 8, 2015 1:45AM

If a seller makes a good profit, it is retail. If the seller breaks even, takes a loss or very minimal profit, it is wholesale. Cheers, RickO

How to define 'Wholesale' versus 'Retail'

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