When does a cut become a rip?
onthespot
Posts: 165 ✭
The King Farouk thread got me to thinking about this. What is considered a "fair deal" for a dealer, who must make a profit, to make off of a "walked in off the street dummy" when it comes to coins? In dogs and horses 10-15% is considered fair in most cases. What is the number with coins?
0
Comments
onthespot wants numbers; like 5% spread on bullion, 10% on common stuff, 15% on semi keys, 20% on keys, 2% on coins purchased from collectors, 2,000% on coins from little old granny ladys, 10% + T&L on collections handled.
Anyone feel free to correct my numbers, I'm not a dealer and may be a tad off.
The longer a coin is likely to remain in inventory (except for consignment sales, perhaps, since the dealer isn't tying up his/her money in the coin), the more likely a dealer's buy price will be at a larger discount to the price sheets.
IF it's a cut, the original owner only bleeds a little. If it's a rip, his heart will remain broken for life.
somethin' like that, anyway.
``https://ebay.us/m/KxolR5
<< <i>Generally, the more liquid the coin, the lower the spread. Dealers make their money not just by the *percentage* markup, but how many times they can turn over a certain value of purchases in a typical time period. Some coins turn over quickly enough that 10-15% might be sufficient. For less liquid coins, a 25% markup might not be unusual, and for low-priced and less liquid coins, it wouldn't be unusual to be offered about half the price sheet value (i.e. $1 for a $2 coin).
The longer a coin is likely to remain in inventory (except for consignment sales, perhaps, since the dealer isn't tying up his/her money in the coin), the more likely a dealer's buy price will be at a larger discount to the price sheets. >>
I agree with ziggy29. For less liquid items, the dealer might have to hold onto them for a while until a customer can be found.
Re: bullion, 5% doesn't leave much room for price fluctuations. I bought some 90%silver (i.e., bullion) some months ago. Later that day the price went down $1 per ounce. The next day, the price went down another $1 per ounce. What happened to the profit? Gone, now in a loss position.
An authorized PCGS dealer, and a contributor to the Red Book.
NSDR - Life Member
SSDC - Life Member
ANA - Pay As I Go Member
<< <i>There are those head-scratching cases ("I swore someone would really want this one!") where and underappreciated just has got to be discounted. This is a tough game sometimes. You really get a sense for it when you go from buyer to seller. It can get downright brutal and cash can get tied up fast for a long time.
>>
Same thing with dogs and horses. I have been left holding the bag on a horse or two, same with dogs, and the upside of coins from where im standing is they don't eat or poop or dig holes.
<< <i>That last reply reminds me of people that type in "I don't know" when they have nothing to contribute.
onthespot wants numbers; like 5% spread on bullion, 10% on common stuff, 15% on semi keys, 20% on keys, 2% on coins purchased from collectors, 2,000% on coins from little old granny ladys, 10% + T&L on collections handled.
Anyone feel free to correct my numbers, I'm not a dealer and may be a tad off.
Round eye---- you clack me up!
at the time of purchace it seemed like a cut but years later it seems like a rip....
True not every cut or rip hangs around that long but some do.....
onthespot if you haven't figured it out yet, no dealer is going to come on here and tell us how much profit he rips from a collector. coinguy1 is the closet thing we have to an honest dealer around her and even he's vauge & evasive about it.
Since you are comparing dog & horses with coins, perhaps you can answer some questions that have been bugging us??
#1 Is a slabbed horse worth more than a raw horse?
#2 Are some horse & dog certification companies more reputable than others?
#3 Is a gelding considered an "altered" horse?
#4 Do horse collectors prefer crusty original horses over cleaned dipped ones?
#5 If somebody sees the vet leaving your barn are you accused of having "doctored" horses?
#6 Is a paint pony the same thing as a colorized ASE on QVC?
#7 Have you ever been shilled @ a horse auction?
#8 Can you ship a horse by Priority Mail or is Fed-X overnight better?
#9 If you trim your horses hooves is that considered "conserved" and your horse is no longer natural?
#10 If you conserve a horse do you disclose that when you sell him?
And the top question....drum roll please........
What kind of horses does the Coin Posse ride?
<< <i>What kind of horses does the Coin Posse ride? >>
Same kind as ghost riders in the sky.
<<<Same kind as ghost riders in the sky.>>>
On horses snortin' fire?
However, coin dealers have one advantage in that their inventory never spoils and usually appreciates so they might be able to cut it a little thinner while coins are going up. when coins are going down, they're going to have to have a higher markup.
I'm not a dealer, just doing a little analysis.
--Jerry
A.The closest thing to a slabbed horse is probably a slab sided one. They are no good cuz they have a limited lung capacity and don't hold up under hard use. I imagine they would bring killer price, which would make them just about equal to a raw horse...
#2 Are some horse & dog certification companies more reputable than others?
A. oh, abso-FREAKING-lutely! AKC is the accepted "gold standard" of certification in the US, even though they only recognize approximately a third of the breeds recognized worldwide. They also do NO quality control over what they register. Anyone who submits paperwork for the litter from two registered parent dogs gets papers, regardless of quality. That notwithstanding, AKC papers are the most desireable in the US, dont want to slam the "other registries" in descending order...
#3 Is a gelding considered an "altered" horse?
A. No, they are considered "new and improved"
#4 Do horse collectors prefer crusty original horses over cleaned dipped ones?
A.No, cleaned and dipped trumps crusty any day of the week.
#5 If somebody sees the vet leaving your barn are you accused of having "doctored" horses?
A. Mannnn.... if the walls could talk, there has been more money made and lost on doctored horses than was ever made on doctored coins, hands down. And yes, ask the guy holding a cup on a long stick at a horse show about how to catch a cheat.
#6 Is a paint pony the same thing as a colorized ASE on QVC?
A. No, paints are born the color they are and it does not change in their lifetime, unlike appaloosas that can shed out a completely different color and pattern from one year to the next.
#7 Have you ever been shilled @ a horse auction?
A. No, not shilled, but I have had the auctioneer run up my bid a few hunnert before he quit yammering. I dug in my heels and held at my final ACTUAL bid and there were no other "pseudo winners" in the wings so he had to take my real bid.
#8 Can you ship a horse by Priority Mail or is Fed-X overnight better?
A. Fedex overnight or else the package gets pretty soggy by the time it gets there....(whew!)
#9 If you trim your horses hooves is that considered "conserved" and your horse is no longer natural?
A. It varies from breed to breed, for example if you show an Arabian with a toe longer than 4 1/2" you can be disqualitfied, but Tennessee Walkers and such grow a toe nearly twice that long, and people pay EXHORBITANT amounts to the shoer every six weeks to "conserve" all that extra toe...
#10 If you conserve a horse do you disclose that when you sell him?
A. Nah, buyer beware, except for known safety and health problems.
And the top question....drum roll please........
What kind of horses does the Coin Posse ride?
A. QUARTER horses, of course, LOL
Thanks for the fun quiz!
If you ask me, as a dealer, to buy your Lincoln Whitman Folder #2 and they are not uncs in great shape, do not expect more than $2-3.00. I do not care if they were collected from circulation 50 years ago or bought within the last year. They will be scanned for varieties and condition and 95% of them will be dumpped into the 2 cents each bulk bucket. Folder One is always missing the keys so Ditto. The same is true for almost all common series. Do you know a scarce Roosie that is not an obscure variety that few care about anyway?
If you bring me a $1000.00 coin that I already have a buyer for or know will sell quickly I will likely pay you or the little ole lady $900.00. If I think it will sit in my case for a while, I will offer you $500.00 or less. Sorry but I do not care if you paid $5.00 or $1500.00 for it - I am more concerned with what I will be able to sell it for and when.
In my area Morgans are rather plentiful - do not expect premiums for average coins.
Type coins have to be outstanding here for them to get any premium - there just are not enough folks buying the every day stuff.
Above average coins command above average offers. Average varies with each series. Know your series, buy accordingly, and you will not be so disappoited when it comes time to sell. I personally like three cent silvers and I also know that unless the coin is outstanding it will sit in a dealer's case for a long time ($20 value or $200 it does not matter) so I only buy nice ones as a collector so that any real dealer will be happy to buy them if I have to sell them.
Dark side is virtually dead here unless it is Imperial Roman - These I refer to one select almost local dealer
In short 98% of what I am offered when I am wearing my dealer shirt is stuff that I really do not want but will buy so that I can get the 2% that pays the bills. If you are concerned with what a dealer will pay for your new purchase then ask before you buy and remember that with time that too will change because the coin market is always in flux. What is hot today will be tomorrow's "old hat".
I have spent over twenty years on the dealers side of the counter and even more as a collector. The active dealer shirt was put away a little while ago but I still buy and sell coins and stuff from time to time.
<< <i>I think you have to factor in time, if you pay 90 bucks for a 100 dollar coin today and loose it in the back of your safe, pull it out 10 years later and sell it for 200 bucks is it a rip or cut.....
at the time of purchace it seemed like a cut but years later it seems like a rip....
True not every cut or rip hangs around that long but some do..... >>
8% annual appreciation is a moderately decent investment ($200 from $90 in 10 years). But there are enough cases where there are losses to trim that down. Any dealers out there with inventory from just before the last market dump? A lot of folks still haven't made their cost basis back from the peaks.
NSDR - Life Member
SSDC - Life Member
ANA - Pay As I Go Member
<<coinguy1......... and even he's vauge & evasive about it.>>
Dog, give me a breakdown of the type, quality, quantity and approximate value of this hypothetical collection, or at least a bit more information, and I'll be happy to provide a specific answer. In case you don't feel like doing that, however
If the collection consisted of non-bullion coins, were of relatively small size and not a pile of junk, I would likely make my offer such that if I could get my expected sell price, I'd net about 15%. I'd hope to make 10% or more and would feel guilty if I made 20% or more.
As you know, there are many times when a coin's "value" might be largely determined by its certified grade and where the difference in value between two grades can be considerable. In such cases, I might offer the seller a minimum price at the time and financial upside if the coin grades out above what I expect. I might also give the seller the option to have me submit the coin for grading or re-grading and for us to determine the price to be paid to the seller after the grading results come in. That is fairer to both of us.
What kind of horses does the Coin Posse ride?"
"A. QUARTER horses, of course, LOL"
ROFL!!!
42/92
No problem. I pretty much did that when I exampled 5% on bullion, 10% on common stuff, 15% on semi keys, 20% on keys. You know, like what the typical CU board member would have consisting of a complete slabbed Classic series set with a roll or 2 of SAE in Mint tubes.
10% + T&M on collections handled, say like King Farouk, Mr. Pittman, Benson, etc walked in and wanted to sell their collection.
The 2% on coins purchased from collectors, 2,000% on coins from little old granny ladys, was noting more than a factious statement based on what I read on the board…..notice I put the grinning idiot icon in there
However, onthespot said a "walked in off the street dummy" which would not be the forementioned advanced collector but somebody with butter containers & cigar boxes containing what we call “Junk;” several dozen plucked from circulation wheat pennies, Bicentennial Quarters, war nickels, 1964 quarters & dimes, dateless Buffs & a 1938 Buff in XF, a silver JFK, several 40% JFK’s, a Canadian penny & dime, 2 1967 Mint Sets, a put together polished up 1956 birth year set in a capital holder, 3 BU 1886 Morgs in a pretty little Littleton Presentation case, a set of circ Mercs & Lincolns in Whitman folder missing the keys of course, a set of colorized ASE bought from HSN and a 1976 $2 bill that has been carried in a wallet for 30 years. Mrpawn handled that basically with his reply but onthespot wants to hear face x4 on common silver, face x 6 on common circ Barbers, bid on the Morgans & Mint sets, spot on the ASE, 2¢ ea on the foreign stuff that goes in the junk box @ 10¢ ea or 12 for $1 etc etc.
mardi gras tokens has value but the work required to sell these is huge. It's the same with bad
mixes of world coin. If you have 50lbs of mostly Mexican, Canadian, and European minors you can't
sell them wholesale at $4 per pound. You'll be lucky to find a buyer for such stuff and it might be a
door stop for decades.
You run into a similar problem with more desirable coins. Sometimes heirs will divide up an estate
by splitting mint sets or other such sets. What do you pay for half a 1995 mint set when either
half is worth more than 20% of the whole? Who buys half a 1995 mint set?
What about a box full of circ bicentennial quarters? You can get $14 per roll if you ship them but
the effort and cost is substantial and you'll wait for your money. Even taking to the bank is some
work.
Here, lemme open a coin shop so I can make 4 bucks on a $600 gold bullion ounce and be a robbery target every day. Sounds FUN.
If a Dealer buys a common date MS65 Morgan for $75 from a little old lady, and common date Morgans are going for $175, then I would expect to pay $175, the same amount I'd expect to pay if the dealer paid $200 for it.
So I do not think there is a magic number for a markup. This is capitolism at its finest!