A dealer's time is valuable-- should they require retainers if you want to use their services

Longacre · February 24, 2006 2:01AM

Just like a good lawyer, a good coin dealer is pretty hard to find. A dealer has a business to run, and does not have a lot of time to devote to useless searches or servicing want lists from noncommittal customers.

Should the "upper tier" dealers start a trend of asking potential clients for a retainer fee in order for the dealer to work with the client?

For example, say a client has a want list for some fairly esoteric, or highly valuable coins. Searching for the coins or trying to make contacts with the owners of the highly valuable coins will take some time. And of course, a good dealer will know the ropes of the business and market and know how to find those sought after pieces. In order to ensure that the dealer is not wasting his time (and admittedly the dealer's time is valuable), should the dealer ask for, say, a $5,000 retainer in order for the client to ensure that the dealer will be available when the client needs services?

What would be a reasonable retainer fee? As a collector, would you be willing to "have a dealer on retainer" in case you need his services in the future?

Merc · February 24, 2006 2:12AM

Some dealers already do this. They will charge a finders fee for hunting down a coin. Sorry, I don't know the fees. They usually deal in coins that cost more than my new car.

RYK · February 24, 2006 2:17AM

I disagree with your premise. Many sales transactions are such that there is no fee to the buyer until the item is purchased. I wasted some time of the salesman at the car dealer last week, and he got nothing. We have been working with a real estate agent for two years looking to buy a house, and so far, she has nothing to show for it. This is the nature of the coin business, and I doubt that most collectors would accept such an arrangement. However, since you are tal;king about "upper tier", this may already be happenning without my knowledge. (I am more of an "upper middle tier" type

)

chabot510 · February 24, 2006 2:23AM

AS a dealer myself, I do the following when dealing with a want list. Keep in mind I deal with coins genereally at $5,000 or below.

If a client fills out a want list, and I find a coin that meets his criteria, I send the coin to him on approval or after his payment has been accepted. The client then has 5 days (the length of my return policy) to decide whether he wants to keep the coin or not. If he decides to pass, I provide them with return shipping for the coin. By doing this, clients are more likely to deal with me in the future. The clients have nothing to lose with this policy.

If they decide to pass on the coin, I generally just add the coin to inventory. Most of the times the coins are pretty special and have a lot of eye appeal, so they sell pretty well.

This might work a little differently with coins upwards of $20K, since the collector base is much thinner at that price level.

kiyote · February 24, 2006 2:36AM

<< Some dealers already do this. They will charge a finders fee for hunting down a coin. Sorry, I don't know the fees. They usually deal in coins that cost more than my new car. >>

What kinna car did ya get, Merc?

291fifth · February 24, 2006 2:47AM

Dealers quickly size-up potential clients. They will spend time on clients they think have money and want to spend it.
There is no reason for a serious collector with money to spend to pay a "retainer."

High end numismatics is business. If you have money to spend, the dealer will not want to let you get away.
The day they think you are putting the brakes on spending, however...

LeeG · February 24, 2006 2:49AM

<< (I am more of an "upper middle tier" type)

>>

As a "Bottom Tier" Collector Type

Who enjoys quality coins at fair prices, I would hope these types of things can be handled on a case by case basis. If a coin I need took a Dealer a long time, and alot of work to locate, we could discuss these details, and fair payment, at the time of the transaction.

Elcontador · February 24, 2006 2:53AM

I am a CPA. The only things I have to sell are my time and expertise. I can quickly size up who is genuinely interested in using my services, and who is not. I can't imagine other people in my situation being much different than I am.

CTcollector · February 24, 2006 2:59AM

finders fee - yes, special requests - yes, retainer - no

Julian · February 24, 2006 3:01AM

I have never asked for or received a retainer for my professional services. If I find a coin for a client, I make a commission. If I purchase a coin for a client at an auction, I receive a commission.

I do charge for written appraisals and for long consultations, not for casual questions. I freely offer my opinions knowing that I will probably get future business.

I do not see the necessity for retainers.

Gator5220 · February 24, 2006 3:01AM

I completely disagree. The customer's time is just as important. The dealer's job is to find me the coin I want. If he does, and the price is right I will purchase from him.

Doesn't customer service factor into this somewhere? If two dealers can find me a coin, but one wants to charge me for his time, then the other will get my business.

chabot510 · February 24, 2006 3:03AM

<< I completely disagree. The customer's time is just as important. The dealer's job is to find me the coin I want. If he does, and the price is right I will purchase from him.

Doesn't customer service factor into this somewhere? If two dealers can find me a coin, but one wants to charge me for his time, then the other will get my business. >>

i fully agree with this!

MORGANHUNTER2 · February 24, 2006 5:46AM

A retainer? not the kind you have glued to your teeth right?
Gee for a moment I thought i heard a lawyer in that comment.

I charge a fee for my service when rendered to a client, but then again- my fee is not cheap, and its not by the hour.

tmot99 · February 24, 2006 5:52AM

A retainer? You gotta be kidding. Isn't that why they mark up a coin? Isn't the markup their fee? Their payment for tracking down a coin? Maybe I should ask my employer for a retainer in order to keep me around. Oh that's right. I work, then get paid.

RYK · February 24, 2006 5:58AM

Longacre,

I think that you should rescind your suggestion...or risk getting lynched by the CU Forum Posse™.

coynclecter · February 24, 2006 6:22AM

I don't know about a "retainer" and 5000 seems quite steep but I do think more upper end transactions should be based on compensation for time spent rather than just a fat commission if the dealer finds a coin he can convince me to buy.

Let's say I want some proof gold, 100K worth. The dealer goes out and spends 15-20 hours finding the right pieces, getting them on consignment and presenting them to me. Now if Im anal and I want a high end coin for cheap, the dealer has wasted his time. On the other hand, if Im not too knowledgable, the dealer might recommend a second rate coin because he can make a bigger $$ on it. Frankly I want a dealer I can trust who will put my interest above his commission. ( and don't compare to RE Agents, they are totally selfserving)

I would have no objection to telling a dealer that I expect him to make no money on the coins but I would pay him 50-80 bucks an hour plus expenses to work as my agent. Then I would expect him to give me honest recommendations I can count on without feeling he needs to"sell me something" to cover his time.

Of course if he doesn't come through with anything nice, Im out a little and I tell him I no longer need him but if he comes through with some nice material I can probably save some $$ on the deal and he can know he didn't waste his time.

Now all I need is 100K for the proof gold

relayer · February 24, 2006 6:47AM

A dealer shouldn't have to waste his time where there are plenty of people they can be screwing over

ColonialCoinUnion · February 24, 2006 6:53AM

I'd pay someone a retainer if they were worth retaining.

nolimitz · February 24, 2006 6:58AM

As in most businesses, if a dealer/sales agent does'nt set the hook when the fish is on the line, it's his loss.

ziggy29 · February 24, 2006 7:02AM

If a client is good enough and gives them enough business, that IS their "retainer."

There's a reason why dealers don't want to deal with people who pass on most of the stuff they find...and winding up spending $100 (for a $10-20 dealer profit) when they finally do buy something. THOSE are the type of customers for whom a retainer might make sense.

But someone regularly spending five and six figures per year on coins don't need to pay retainers. Dealers would love to have their business without it.

Gator5220 · February 24, 2006 7:23AM

I am in business, but not the coin business. There's three things I must do to earn a customer's business, both today and in the future:

1.) Find the product that the customer wants
2.) Offer a price the customer is willing is to pay.
3.) Provide that customer service which is superior to my competitors, but during and after the sale.

Retainers fail to deliver on all three.

Longacre · February 24, 2006 7:47AM

<< Longacre,

I think that you should rescind your suggestion...or risk getting lynched by the CU Forum Posse?. >>

Troublemaker.

I'm just watching out for the dealer crowd and making sure they get just compensation.

TommyType · February 24, 2006 8:02AM

Question on the whole concept of "retainers":

Isn't the general arrangement such that it is actually CHEAPER to have a lawyer on retainer, assuming frequent "use", than it would be to pay per hour/action?

If so, it might be a step down!

(Obviously, I've never had a lawyer or coin dealer on retainer.....thankfully, very few of either actually know my name.)

mrearlygold · February 24, 2006 8:31AM

Depends on who the customer or potential customer is.

coinkat · February 24, 2006 9:32AM

Retainers... Has it really come to that? Oh please...

majorbigtime · February 24, 2006 9:34AM

I don't mind paying a dealer a reasonable hourly fee for advice--most do it for free, looking for future business,

ColonialCoinUnion · February 24, 2006 10:10AM

<< Also, I highly doubt any dealer is going out of their way to look for a highly esoteric coin. >>

If its not a' highly esoteric coin', I highly doubt I'll need a dealer to find it for me.

A dealer's time is valuable-- should they require retainers if you want to use their services

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