@FSF said:
There's no question that most of the advice and comments made in this thread have been thoughtful and mostly accurate. However, I think that the principles of inventory turnover, while still applicable, are probably a lot less so here than in most cases. While turnover is indeed very important, it does not necessarily provide answers to the most profitable business model because the margins are not constant across all products being sold. If you only make 2% on bullion, you'd have to turn 10 times the amount what you would selling common decent generic rare coins over the same period.
But that is exactly the point. You state that the principles of inventory turnover is not important here and then show how it is important by performing some simple turnover analysis based on the business and margins, presumably coming to the conclusion that rapid turnover is not important in this case. One needs to analyze inventory turnover for their business/inventory/model and try to draw conclusions. The advice is not that every business should have the same turnover rate. But rather understand your turnover rate and act accordingly.
There seems to be some confusion that understanding inventory turnover means quickly turning over inventory. That is not at all the case.
The original question was about using debt to finance inventory. So naturally the conversation steered to inventory turnover. If you can sell an item in 10 days for 20% margin, yeah, debt makes sense. If it is going to take you 24 months to sell it for a 20% margin, then maybe it doesn't make sense.
@ErrorsOnCoins said:
I know exactly what a widget is.
Art is not a widget.
I consider my coins art.
I am not going to give it away nor lose money on unique coinage.
IMHO, 2 very dangerous thoughts expressed there:
1) My stuff is different. Everyone believes their stuff is different, and even art. Even "art galleries" follow basic business models because, they sell widgets. A widget is anything offered for sale, be it physical (Like any coin, an error coin, Rembrandt Painting, PVC pipe, Collie Dog, or non Physical (song, business concept, stolen baseball coaches' hit and run sign, etc.)
I have looked at your coins before, and, yes, they are widgets. You call them Art, that is fine, but even Art sells things, unique, and they are a widget. Cloud your mind that since you call it art, the basic rules of life don't apply, is neither a wise course of action or a sustainable plan. Will you succeed? Maybe. But ignoring basic concepts since your ART is different and esoterically phenomenal that other can't comprehend it, is recipe for disaster.
2) When you build your business plan with one of the foundation stones etched "I will not lose money on (fill in the blank)" you set yourself up, again, with a myopic vision of a success vector that basically creates the situation that if you buy something that turns out not be something you can make money on, rather than bite the bullet and sell at a loss, you revector it into either permanent dead inventory or "slide" it over into your collection, as obviously, no one recognizes the gem that it is.
I LOSE money on some things. I paid too much, I misread the market, it was not all that great after all, whatever, but that is part of my opportunity costs. I RISK many things that will have a few fails, because otherwise, I have not risked enough. I admit it, sell it at a loss, move on, and chalk it up to experience.
Without going into my background, that might seem pompous, I worked in semiconductors creating new microchips. My area of focus was something called Quantum Trenching, basically, trying to create transistors at the atomic level. The smaller the transistor, the faster, and less power. Lots of ideas were tested and failed. Things that had promise, crashed and burned. Even when it worked, yields were poor as we worked up the learning curve. This was true art, manipulating silicon, boron, phosphorus, copper, gallium, oxygen, etc. to create something that had never existed.
Even when it worked, it lived on the the ragged edge. One device was so complex, manufacturing so difficult, that 99% were scrapped. Yet, that 1% that made it were 1) So far off the charts is performance, it blew everything else out of the water, and 2) at 1%, was wildly profitable.
As an inventor, Edison made 1,000 unsuccessful attempts at inventing the light bulb. When a reporter asked, "How did it feel to fail 1,000 times?" Edison replied, "I didn't fail 1,000 times. The light bulb was an invention with 1,000 steps."
I hope you are a huge success in your error coin business.
Am I missing something? This seems to be like one of those threads where a poster posts a piece of PMD and asks if it is a rare variety. When numerous knowledgeable readers explain, some at great detail, the answer to the question, the OP repeatedly ignores and deflects the explanations.
@FSF said:
There's no question that most of the advice and comments made in this thread have been thoughtful and mostly accurate. However, I think that the principles of inventory turnover, while still applicable, are probably a lot less so here than in most cases. While turnover is indeed very important, it does not necessarily provide answers to the most profitable business model because the margins are not constant across all products being sold. If you only make 2% on bullion, you'd have to turn 10 times the amount what you would selling common decent generic rare coins over the same period.
Doesn't matter. Ultimately the most efficient model is the highest turnover model. Thin margins may cap your max yield. But even high margins are going to be more efficient eith higher turnover.
All comments reflect the opinion of the author, evn when irrefutably accurate.
@mustangmanbob said:
I LOSE money on some things. I paid too much, I misread the market, it was not all that great after all, whatever, but that is part of my opportunity costs. I RISK many things that will have a few fails, because otherwise, I have not risked enough. I admit it, sell it at a loss, move on, and chalk it up to experience.
I have come to the conclusion that if I'm not losing money on some stuff, I'm missing out on opportunities to make money on others. The challenge is to avoid passing the point where I'm so aggressive in buying that I'm losing more than winning.
@mustangmanbob said:
I LOSE money on some things. I paid too much, I misread the market, it was not all that great after all, whatever, but that is part of my opportunity costs. I RISK many things that will have a few fails, because otherwise, I have not risked enough. I admit it, sell it at a loss, move on, and chalk it up to experience.
I have come to the conclusion that if I'm not losing money on some stuff, I'm missing out on opportunities to make money on others. The challenge is to avoid passing the point where I'm so aggressive in buying that I'm losing more than winning.
I felt that way about the stock market...until I started losing more than I was winning. LOL
All comments reflect the opinion of the author, evn when irrefutably accurate.
@FSF said:
There's no question that most of the advice and comments made in this thread have been thoughtful and mostly accurate. However, I think that the principles of inventory turnover, while still applicable, are probably a lot less so here than in most cases. While turnover is indeed very important, it does not necessarily provide answers to the most profitable business model because the margins are not constant across all products being sold. If you only make 2% on bullion, you'd have to turn 10 times the amount what you would selling common decent generic rare coins over the same period.
Doesn't matter. Ultimately the most efficient model is the highest turnover model. Thin margins may cap your max yield. But even high margins are going to be more efficient eith higher turnover.
That is only true if margin and turnover are uncorrelated. In most cases, they are going to be negatively correlated, so there should be a theoretically optimal turnover rate.
For the OP, what is your average gross margin per coin? What is your turnover rate? Can you change the mix of your inventory to increase either of those numbers?
You run a business. It does not matter how unique your inventory is. The principles of business and inventory management still apply.
@FSF said:
There's no question that most of the advice and comments made in this thread have been thoughtful and mostly accurate. However, I think that the principles of inventory turnover, while still applicable, are probably a lot less so here than in most cases. While turnover is indeed very important, it does not necessarily provide answers to the most profitable business model because the margins are not constant across all products being sold. If you only make 2% on bullion, you'd have to turn 10 times the amount what you would selling common decent generic rare coins over the same period.
Doesn't matter. Ultimately the most efficient model is the highest turnover model. Thin margins may cap your max yield. But even high margins are going to be more efficient eith higher turnover.
That is only true if margin and turnover are uncorrelated. In most cases, they are going to be negatively correlated, so there should be a theoretically optimal turnover rate.
For the OP, what is your average gross margin per coin? What is your turnover rate? Can you change the mix of your inventory to increase either of those numbers?
You run a business. It does not matter how unique your inventory is. The principles of business and inventory management still apply.
The beauty of quick turnover is the lessening of risk from declining values. Scan Ebay and see loads of modern gold commems that traded for $1500-$2000 dollars a decade ago that are hovering near melt now. One sees the same coins appear at inflated prices over and over again as the market erodes.
I was fortunate to avoid most of that as most of my business (when Ebay was viable for high volume sellers) was no reserve 7-10 day auctions.
Seems if you have no expenses you are fine. If you need cash you can liquidate or take on debt. Is a business that generates sporadic surge of income a business?
If you are the employee/owner would rather get paid once a year or have lucrative predictable cash flow...
WTB... errors, New Orleans gold, and circulated 20th key date coins!
Every time I hear my business is special....> @ErrorsOnCoins said:
@shorecoll said:
You have $300k inventory. If you kept the next $30k that sells in cash, would it hurt your business, would anyone notice?
If you think it would hurt you and people would notice, keep building. If not, do that.
If I kept the next 30k that sells in cash, no It would not hurt my business. No one would notice either.
But, In my mind, it would hurt what I am trying to build. I am still building my business. I want to grow my inventory. I would want to put that 30K into new inventory working for me. Cash does me no good, except for peace of mind. By putting that 30K to work, now my retail inventory value be above 300K, thus growing.
Sounds more like hoarding?
WTB... errors, New Orleans gold, and circulated 20th key date coins!
Doesn't matter. Ultimately the most efficient model is the highest turnover model. Thin margins may cap your max yield. But even high margins are going to be more efficient eith higher turnover.
That is only true if margin and turnover are uncorrelated. In most cases, they are going to be negatively correlated, so there should be a theoretically optimal turnover rate.
For the OP, what is your average gross margin per coin? What is your turnover rate? Can you change the mix of your inventory to increase either of those numbers?
You run a business. It does not matter how unique your inventory is. The principles of business and inventory management still apply.
You are correct. That's an added layer of complexity I was trying to avoid.
All comments reflect the opinion of the author, evn when irrefutably accurate.
@shorecoll said:
You have $300k inventory. If you kept the next $30k that sells in cash, would it hurt your business, would anyone notice?
If you think it would hurt you and people would notice, keep building. If not, do that.
If I kept the next 30k that sells in cash, no It would not hurt my business. No one would notice either.
But, In my mind, it would hurt what I am trying to build. I am still building my business. I want to grow my inventory. I would want to put that 30K into new inventory working for me. Cash does me no good, except for peace of mind. By putting that 30K to work, now my retail inventory value be above 300K, thus growing.
Sounds more like hoarding?
What's odd is that his big fear is that his coins are "unique" and "irreplaceable". If that were true, why is the inventory GROWING? It sounds more like it is easier to buy new inventory than move the old inventory.
All comments reflect the opinion of the author, evn when irrefutably accurate.
For me I want fewer slabs but no reduction in that inventory amount and focus on gold coins close to melt, Classic Commems, and CC coins. Material most other dealers may not have where possible. I have about 1200 pieces of Currency both US and World about 100 graded. They are no problem storage, high margin, make case look nice, sprinkled w stacks slabbed silver bullion coins, mod Commems at shows , the currency’s stacks nicely and light weight. The other case higher end slab inventory plus stack of graded US Currency inmiddle (I put nicest, most valuable note at top of stack). I avoid debt and maintain strong cash position (for stuff like walk up and estate deals).
Frankly with the costs of being in the business beyond what it would take to fill ones cases at a show (see above), forced competitive low margins, stagnant / decreasing bids, confirmed lower pop of collectors (retail buyers), I see no reason motivating me to have more inventory. Just a lean and mean smash mouth offense playbook for this team.
@ErrorsOnCoins said:
Can anyone name the top five major US error coin dealers on one hand?
1)
2)
3)
4)
5)
You
Yew
U
Ewe
Yoo
No, not at all. I was serious about that list. Please complete the list honestly.
I left out a super important item yesterday, that is the OP should have read "Dealers, Where is the Sweet Spot between Inventory, Marketing, Cash on Hand and Debt?
I am not an accounting major nor inventory management major.
Sold inventory is likely better marketing.
As long as people see you selling great looking unique items it will attract buyers. If people see you have a huge inventory of great items that sits there for years it won’t have the same result.
Buyers at shows learn quickly which dealers have cool new items regularly with fair prices, and which ones have large inventory’s of overpriced items that they aren’t willing to deal. People thinking they will miss out in a great coin because your inventory turns over quickly will check back more often.
I can see that a quality inventory has some value added and an indicator of what the dealer is about. Still, when I see same items for sale month after month it makes me wonder if they are priced right or somewhat glad I didn’t buy items as nobody else buying them either at that level. For me, turnover is a nice indicator to watch before pulling the trigger.
BTW, all three have substantial Inventories with many coins sitting there for quite some time.
BTW, there are a lot of U.S. dealers with substantial inventories and many coins sitting there for quite some time...you hear people on these boards complaining about them all the time.
All comments reflect the opinion of the author, evn when irrefutably accurate.
@ErrorsOnCoins said:
Can anyone name the top five major US error coin dealers on one hand?
1)
2)
3)
4)
5)
You
Yew
U
Ewe
Yoo
No, not at all. I was serious about that list. Please complete the list honestly.
I left out a super important item yesterday, that is the OP should have read "Dealers, Where is the Sweet Spot between Inventory, Marketing, Cash on Hand and Debt?
I am not an accounting major nor inventory management major.
@mustangmanbob said:
I LOSE money on some things. I paid too much, I misread the market, it was not all that great after all, whatever, but that is part of my opportunity costs. I RISK many things that will have a few fails, because otherwise, I have not risked enough. I admit it, sell it at a loss, move on, and chalk it up to experience.
I have come to the conclusion that if I'm not losing money on some stuff, I'm missing out on opportunities to make money on others. The challenge is to avoid passing the point where I'm so aggressive in buying that I'm losing more than winning.
I felt that way about the stock market...until I started losing more than I was winning. LOL
Stocks held are not seen as inventory. And with coins and stocks, I buy with conviction. I borrow with confidence.
@Nysoto said:
An economic order quantity model is needed, along with just-in-time deliveries, to balance inventory holding costs and average ordering costs:
Actually, I don't know the answer, but you are building a great error coin business!
Dude, exactly how I felt yesterday, LMAO. Thank you!
I know my strengths and I also know my weaknesses.
@mustangmanbob said:
I LOSE money on some things. I paid too much, I misread the market, it was not all that great after all, whatever, but that is part of my opportunity costs. I RISK many things that will have a few fails, because otherwise, I have not risked enough. I admit it, sell it at a loss, move on, and chalk it up to experience.
I have come to the conclusion that if I'm not losing money on some stuff, I'm missing out on opportunities to make money on others. The challenge is to avoid passing the point where I'm so aggressive in buying that I'm losing more than winning.
@jmlanzaf said:
I felt that way about the stock market...until I started losing more than I was winning. LOL
Never tried the stock market. I leave that to the guys managing my 401k.
@Nysoto said:
An economic order quantity model is needed, along with just-in-time deliveries, to balance inventory holding costs and average ordering costs:
Actually, I don't know the answer, but you are building a great error coin business!
Makes me eager to get in the coin business
I manage money. I earn money. I save money . I give away money. I collect money. I don’t love money . I do love the Lord God.
@ErrorsOnCoins said:
Upon more reflection, I realize that I am right about my business model, that is why I had / have a cash reserve.
I Buy any coin that fits my inventory and if I am building (business) cash then I am not Finding the inventory that I need to buy, that is how rare the material is that I deal in.
What about building customers ? That is the ultimate requirement .
So how are you doing that ?
Yes, I have a very good and growing client base as in repeat clients.
Some very good clients buy coins from me before I get a chance to list them in public. They really appreciate that service as do I. I am helping them to build phenomenal collections that I am jealous of
My inventory brought me those clients.
Good for you .....keep developing the clients...... and with your knowledge of error coins you'll be fine.
I manage money. I earn money. I save money . I give away money. I collect money. I don’t love money . I do love the Lord God.
There is a lot of great information in this thread. Very useful, insightful and practical information about how to run a profitable business. However, some businesses - especially, many small businesses - are run for enjoyment and to make a reasonable profit. While there may be ways to maximize the profit potential, successful businesses can be run for less profit and more enjoyment. To each his own. I know the OP requested specific information but there is no one size fits all answer. I have twice left very profitable growing businesses to go smaller, enjoy it more and make less.
I suppose if you’re Inventory mix/ offerings were at a high margin then I would be inclined to have a robust inventory. If you could really blow out all your inventory in one week at cost you’re probably in good shape. I’m a huge fan of niche businesses
mark
Walker Proof Digital Album Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
I actually bookmarked this thread because I love some of the simple examples given. Hopefully it does not get nuked because it has some very valuable business lessons.
I have a question for the OP.
Let's say you started your business with $50,000 of your own collection and you now have $300,000 of inventory. Did the additional $250,000 come from the profits of selling your original collection and then reinvesting and buying/selling more inventory or did you add more personal savings or a side job or your spouses earnings to primarily grow that inventory?
My guess from what you have said is that you are actually turning your inventory at an acceptable rate with a healthy gross profit margin allowing you to grow your business. If this is the case, you are actually making a strong case that your business is following the advice given by @mustangmanbob and @jmlanzaf .
@Justacommeman said:
... I’m a huge fan of niche businesses
mark
"There are riches in the niches"
Now, Ive always heard that niches get stitches.
Some good advice given here, but this whole thread seems a little self serving. The OP already knows exactly how he wants to run his business and is in a constant state of self promotion.
Dead Cat Waltz Exonumia
"Coin collecting for outcasts..."
Comments
But that is exactly the point. You state that the principles of inventory turnover is not important here and then show how it is important by performing some simple turnover analysis based on the business and margins, presumably coming to the conclusion that rapid turnover is not important in this case. One needs to analyze inventory turnover for their business/inventory/model and try to draw conclusions. The advice is not that every business should have the same turnover rate. But rather understand your turnover rate and act accordingly.
There seems to be some confusion that understanding inventory turnover means quickly turning over inventory. That is not at all the case.
The original question was about using debt to finance inventory. So naturally the conversation steered to inventory turnover. If you can sell an item in 10 days for 20% margin, yeah, debt makes sense. If it is going to take you 24 months to sell it for a 20% margin, then maybe it doesn't make sense.
I suppose one could start a thread on here and talk about themselves all the time. That in some folks mind might draw in customers. 😊
IMHO, 2 very dangerous thoughts expressed there:
1) My stuff is different. Everyone believes their stuff is different, and even art. Even "art galleries" follow basic business models because, they sell widgets. A widget is anything offered for sale, be it physical (Like any coin, an error coin, Rembrandt Painting, PVC pipe, Collie Dog, or non Physical (song, business concept, stolen baseball coaches' hit and run sign, etc.)
I have looked at your coins before, and, yes, they are widgets. You call them Art, that is fine, but even Art sells things, unique, and they are a widget. Cloud your mind that since you call it art, the basic rules of life don't apply, is neither a wise course of action or a sustainable plan. Will you succeed? Maybe. But ignoring basic concepts since your ART is different and esoterically phenomenal that other can't comprehend it, is recipe for disaster.
2) When you build your business plan with one of the foundation stones etched "I will not lose money on (fill in the blank)" you set yourself up, again, with a myopic vision of a success vector that basically creates the situation that if you buy something that turns out not be something you can make money on, rather than bite the bullet and sell at a loss, you revector it into either permanent dead inventory or "slide" it over into your collection, as obviously, no one recognizes the gem that it is.
I LOSE money on some things. I paid too much, I misread the market, it was not all that great after all, whatever, but that is part of my opportunity costs. I RISK many things that will have a few fails, because otherwise, I have not risked enough. I admit it, sell it at a loss, move on, and chalk it up to experience.
Without going into my background, that might seem pompous, I worked in semiconductors creating new microchips. My area of focus was something called Quantum Trenching, basically, trying to create transistors at the atomic level. The smaller the transistor, the faster, and less power. Lots of ideas were tested and failed. Things that had promise, crashed and burned. Even when it worked, yields were poor as we worked up the learning curve. This was true art, manipulating silicon, boron, phosphorus, copper, gallium, oxygen, etc. to create something that had never existed.
Even when it worked, it lived on the the ragged edge. One device was so complex, manufacturing so difficult, that 99% were scrapped. Yet, that 1% that made it were 1) So far off the charts is performance, it blew everything else out of the water, and 2) at 1%, was wildly profitable.
As an inventor, Edison made 1,000 unsuccessful attempts at inventing the light bulb. When a reporter asked, "How did it feel to fail 1,000 times?" Edison replied, "I didn't fail 1,000 times. The light bulb was an invention with 1,000 steps."
I hope you are a huge success in your error coin business.
Am I missing something? This seems to be like one of those threads where a poster posts a piece of PMD and asks if it is a rare variety. When numerous knowledgeable readers explain, some at great detail, the answer to the question, the OP repeatedly ignores and deflects the explanations.
Doesn't matter. Ultimately the most efficient model is the highest turnover model. Thin margins may cap your max yield. But even high margins are going to be more efficient eith higher turnover.
All comments reflect the opinion of the author, evn when irrefutably accurate.
The sweet spot is when the tax bill is zero.
IMO
I have come to the conclusion that if I'm not losing money on some stuff, I'm missing out on opportunities to make money on others. The challenge is to avoid passing the point where I'm so aggressive in buying that I'm losing more than winning.
I felt that way about the stock market...until I started losing more than I was winning. LOL
All comments reflect the opinion of the author, evn when irrefutably accurate.
Never tried the stock market. I leave that to the guys managing my 401k.
That is only true if margin and turnover are uncorrelated. In most cases, they are going to be negatively correlated, so there should be a theoretically optimal turnover rate.
For the OP, what is your average gross margin per coin? What is your turnover rate? Can you change the mix of your inventory to increase either of those numbers?
You run a business. It does not matter how unique your inventory is. The principles of business and inventory management still apply.
The beauty of quick turnover is the lessening of risk from declining values. Scan Ebay and see loads of modern gold commems that traded for $1500-$2000 dollars a decade ago that are hovering near melt now. One sees the same coins appear at inflated prices over and over again as the market erodes.
I was fortunate to avoid most of that as most of my business (when Ebay was viable for high volume sellers) was no reserve 7-10 day auctions.
Seems if you have no expenses you are fine. If you need cash you can liquidate or take on debt. Is a business that generates sporadic surge of income a business?
If you are the employee/owner would rather get paid once a year or have lucrative predictable cash flow...
That’s true... but if I made $100 million I would be ok with taxes, less enthused if I had $0 tax liability on $35K
Every time I hear my business is special....> @ErrorsOnCoins said:
Sounds more like hoarding?
You are correct. That's an added layer of complexity I was trying to avoid.
All comments reflect the opinion of the author, evn when irrefutably accurate.
What's odd is that his big fear is that his coins are "unique" and "irreplaceable". If that were true, why is the inventory GROWING? It sounds more like it is easier to buy new inventory than move the old inventory.
All comments reflect the opinion of the author, evn when irrefutably accurate.
Of course, we won't discuss my "business model". I just packed 3 stamp sales that totaled $7 - with free shipping!!! LOL
Oh, and that's 3 DIFFERENT buyers!
All comments reflect the opinion of the author, evn when irrefutably accurate.
Can anyone name the top five major US error coin dealers on one hand?
1)
2)
3)
4)
5)
For me I want fewer slabs but no reduction in that inventory amount and focus on gold coins close to melt, Classic Commems, and CC coins. Material most other dealers may not have where possible. I have about 1200 pieces of Currency both US and World about 100 graded. They are no problem storage, high margin, make case look nice, sprinkled w stacks slabbed silver bullion coins, mod Commems at shows , the currency’s stacks nicely and light weight. The other case higher end slab inventory plus stack of graded US Currency inmiddle (I put nicest, most valuable note at top of stack). I avoid debt and maintain strong cash position (for stuff like walk up and estate deals).
Frankly with the costs of being in the business beyond what it would take to fill ones cases at a show (see above), forced competitive low margins, stagnant / decreasing bids, confirmed lower pop of collectors (retail buyers), I see no reason motivating me to have more inventory. Just a lean and mean smash mouth offense playbook for this team.
You
Yew
U
Ewe
Yoo
No, not at all. I was serious about that list. Please complete the list honestly.
I left out a super important item yesterday, that is the OP should have read "Dealers, Where is the Sweet Spot between Inventory, Marketing, Cash on Hand and Debt?
I am not an accounting major nor inventory management major.
Inventory is marketing.
Sold inventory is likely better marketing.
As long as people see you selling great looking unique items it will attract buyers. If people see you have a huge inventory of great items that sits there for years it won’t have the same result.
Buyers at shows learn quickly which dealers have cool new items regularly with fair prices, and which ones have large inventory’s of overpriced items that they aren’t willing to deal. People thinking they will miss out in a great coin because your inventory turns over quickly will check back more often.
My Ebay Store
I can see that a quality inventory has some value added and an indicator of what the dealer is about. Still, when I see same items for sale month after month it makes me wonder if they are priced right or somewhat glad I didn’t buy items as nobody else buying them either at that level. For me, turnover is a nice indicator to watch before pulling the trigger.
Fred
Mike Byers
I assume auction houses don't count?
All comments reflect the opinion of the author, evn when irrefutably accurate.
No auction houses sell everything they are not a specialty dealer ...
I will add one, name two more.....
1) Fred Weinberg
2) Mike Buyers
3) Jon Sullivan
4)
5)
BTW, all three have substantial Inventories with many coins sitting there for quite some time.
That's about as far as I can go. I leave it to the others to finish the list.
All comments reflect the opinion of the author, evn when irrefutably accurate.
BTW, there are a lot of U.S. dealers with substantial inventories and many coins sitting there for quite some time...you hear people on these boards complaining about them all the time.
All comments reflect the opinion of the author, evn when irrefutably accurate.
Other than Fred I have no idea.
Stocks held are not seen as inventory. And with coins and stocks, I buy with conviction. I borrow with confidence.
``https://ebay.us/m/KxolR5
An economic order quantity model is needed, along with just-in-time deliveries, to balance inventory holding costs and average ordering costs:
Actually, I don't know the answer, but you are building a great error coin business!
Dude, exactly how I felt yesterday, LMAO.
Thank you!
I know my strengths and I also know my weaknesses.
during a recession, you definitely want more cash on hand. I think we will be in one sometime in the next 18 months
Makes me eager to get in the coin business
I give away money. I collect money.
I don’t love money . I do love the Lord God.
Good for you .....keep developing the clients...... and with your knowledge of error coins you'll be fine.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
There is a lot of great information in this thread. Very useful, insightful and practical information about how to run a profitable business. However, some businesses - especially, many small businesses - are run for enjoyment and to make a reasonable profit. While there may be ways to maximize the profit potential, successful businesses can be run for less profit and more enjoyment. To each his own. I know the OP requested specific information but there is no one size fits all answer. I have twice left very profitable growing businesses to go smaller, enjoy it more and make less.
I suppose if you’re Inventory mix/ offerings were at a high margin then I would be inclined to have a robust inventory. If you could really blow out all your inventory in one week at cost you’re probably in good shape. I’m a huge fan of niche businesses
mark
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
Why not establish the market? Establish a buy/sell spread sliding scale for errors. Create the market and support it?
I am actually being a market maker for a few error types now
I use to market make other errors but have given those up. Depends on the coin, error type, but especially eye appeal.
I am kinda being a market maker on any major error coin with insane eye appeal in my price range.
"There are riches in the niches"
Whatever happened to Ken Potter? Wasn't he an error expert?
I actually bookmarked this thread because I love some of the simple examples given. Hopefully it does not get nuked because it has some very valuable business lessons.
I have a question for the OP.
Let's say you started your business with $50,000 of your own collection and you now have $300,000 of inventory. Did the additional $250,000 come from the profits of selling your original collection and then reinvesting and buying/selling more inventory or did you add more personal savings or a side job or your spouses earnings to primarily grow that inventory?
My guess from what you have said is that you are actually turning your inventory at an acceptable rate with a healthy gross profit margin allowing you to grow your business. If this is the case, you are actually making a strong case that your business is following the advice given by @mustangmanbob and @jmlanzaf .
I guess what th> @Davideo said:
Now, Ive always heard that niches get stitches.
Some good advice given here, but this whole thread seems a little self serving. The OP already knows exactly how he wants to run his business and is in a constant state of self promotion.
Dead Cat Waltz Exonumia
"Coin collecting for outcasts..."