How does a new coin dealer establish himself as an upscale dealer, and not some average Joe dealer?
Longacre
Posts: 16,717 ✭✭✭
I always wondered this about the new guys who start out as dealers in numismatics. How exactly do they establish themselves, from the start, as “upscale” dealers, rather than just an average Joe dealer who is just starting out? We all know that once someone is pegged as a particular type of dealer, it is hard to shake it. For example, although I have no experience with the two-page advertisers in CW, I assume that they have always been a two-page advertiser-type dealer, and at this point, it is virtually impossible for them to be considered a high-end, upscale dealer.
What can a new dealer do to establish himself as a white shoe dealership? I assume that they can just refuse to handle generic coins and only deal with upscale inventory, but is that enough? Does it matter which clients they have? If they have one or two very prominent clients, can they ride that wave to show that they have what it takes to deal with the big boys, and thus other big clients will come? How do you balance the need to survive (and pay the bills) with the desire to be known as an upscale dealer among your peers?
What can a new dealer do to establish himself as a white shoe dealership? I assume that they can just refuse to handle generic coins and only deal with upscale inventory, but is that enough? Does it matter which clients they have? If they have one or two very prominent clients, can they ride that wave to show that they have what it takes to deal with the big boys, and thus other big clients will come? How do you balance the need to survive (and pay the bills) with the desire to be known as an upscale dealer among your peers?
Always took candy from strangers
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
0
Comments
<< <i>I wouldn't have much confidence in a dealer who jumped into business dealing exclusively in "upscale" coins. >>
Why not? There is always the possiblity of outside funding. Legend is an example of that model.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
Why not? There is always the possiblity of outside funding. Legend is an example of that model.
I might be wrong, but I think that Laura did her share of buying and selling rolls of generics before establishing herself as an upscale dealer who works with moneyed clients. A dealer who begins his or her business by dealing in nothing but "upscale" coins -- which Longacre hasn't defined, but I take to mean expensive rarities -- likely lacks the breadth and depth of experience necessary to form sound opinions on those coins. I don't want to rely on a dealer who relies on the plastic.
Ray
Rob
I believe my other guess would to be...have Lasik done and market yourself as upscale dealer with super powers!
4/123
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Invested $216.76
Return on Investment $0.68
Found but keeping $.15
If I was doing it I'd apprentice under a "upscale" dealer I respected and possibly take over his/her
business when they retired or move out on my own.
Adrian is a better example, but he didn't need the money and was only doing it part time to start with. He has certainly gained more experience, always had a great eye, and now has Brandon and is very much involved full-time.
Most new starts do not have the advantages that Adrian had.
It definitely takes time and experience to establish yourself as an upscale dealer!!
I firmly believe in numismatics as the world's greatest hobby, but recognize that this is a luxury and without collectors, we can all spend/melt our collections/inventories.
eBaystore
Of course this won't give you any insights into 2-digit buffalos or moderns.
There are a lot of dealers now days that have a different face for different venues and
most dealers maintain some sort of web presence.
(b) Own some great coins and registry sets, e.g. Legend.
(c) Have a good website. For example, I find it very difficult to navigate Legend's website but every easy to navigate Anaconda's website.
(d) Have a name similar to a numismatic luminary, e.g. Albanese Rare Coins (coinace.com).
Provide some service or product other companies cannot.
or
Make everyone elses attempt at providing that service or product look like they do a pathetic job at it
I think you need to go above and beyond, pay premiums for quality, and - most importantly - convince your clients to pay that premium
Heavens, no!
To be upscale, IMO, one needs three of the following: high-end inventory, a track record/reputation, excellent capitalization, access to the high-end collectors, expertise in a specialty area/niche, and a cool name (Pinnacle, Legend, Anaconda, etc.).
The most important is the capitalization. If you can continue to outbid the majors at auction, you will end up with the expensive coins, and the high-end collectors will follow, irrespective of whether or not you know what you are doing.
Trot shows and buy all the high numbers you can.
Never buy raw.
Add price to your cost.
Offer what you scarfed up for sale.
Repeat.
Edited to add: Don't do it unless market is obviously gaining to bail you out.
<< <i>I think you need to be able to: Provide some service or product other companies cannot. >>
I think this hits the nail on the head. But what service or product can a coin dealer offer that other dealers do not?
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
<< <i>
<< <i>I think you need to be able to: Provide some service or product other companies cannot. >>
I think this hits the nail on the head. But what service or product can a coin dealer offer that other dealers do not? >>
Is this a theoretical question or are you thinking of quitting your day job?
<< <i>
<< <i>
<< <i>I think you need to be able to: Provide some service or product other companies cannot. >>
I think this hits the nail on the head. But what service or product can a coin dealer offer that other dealers do not? >>
Is this a theoretical question or are you thinking of quitting your day job?
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
Most brick and mortar coin shops carry run-of-the-mill coins at run-of-the-mill prices with few exceptions. Collectors who spend LOTS of money don't want that.
They want the TRUE rarities and the EXCEPTIONAL pieces. Few companies can acquire these on a regular basis. The successful companies acquire either:
BIG BIG numbers (IE Heritage)
or
AMAZING items (IE Anaconda)
You can either make money off of high ticket items with large premiums (Anaconda - breath taking pieces)
or
Make your fortune off the 15% auction house fee on billions of dollars worth of other peoples materials (Heritage - HUGE)
But what is even more interesting is people's perception of who the "big boys" really are. I go through coin world on a regular basis and the people you would think are the "major players" based on their public appearance are sometimes also the same companies that request other dealers to hold their check for a few days before cashing them.
I guess it goes to show you how important perception is in business. But, smoke and mirrors are sometimes just that, smoke and mirrors.
Want to establish yourself in this business?
Satisfy your good customers, treat them fairly, take time to educate them, be an authority in the field in which they are interested, make them money on the coins you suggest to them, gain their trust, and work smart with your advertising budget. Never overextend yourself.
Most people agree that Heritage is one of the most well-established coin companies, yet they handle more generic coins than anybody. So I don't think refusing to deal in generic coins is the way to establish yourself as player with major rarities.
Having a bunch of overpiced rarities for sale is not the way to go either, nor is having a couple of wealthy clients whose money you use to buy bad deals.
By playing the back nine with Boiler, Lakesammman, and TDN.
<< <i>It's funny, with all these responses, that nobody mentioned what most businesses should consider absolutely essential to experiece growth and establish themselves.
But what is even more interesting is people's perception of who the "big boys" really are. I go through coin world on a regular basis and the people you would think are the "major players" based on their public appearance are sometimes also the same companies that request other dealers to hold their check for a few days before cashing them.
I guess it goes to show you how important perception is in business. But, smoke and mirrors are sometimes just that, smoke and mirrors.
Want to establish yourself in this business?
Satisfy your good customers, treat them fairly, take time to educate them, be an authority in the field in which they are interested, make them money on the coins you suggest to them, gain their trust, and work smart with your advertising budget. Never overextend yourself.
Most people agree that Heritage is one of the most well-established coin companies, yet they handle more generic coins than anybody. So I don't think refusing to deal in generic coins is the way to establish yourself as player with major rarities.
Having a bunch of overpiced rarities for sale is not the way to go either, nor is having a couple of wealthy clients whose money you use to buy bad deals. >>
I couldn't have said it better myself. Brokering only expensive coins is often dependent on the seller's finances and not on experience or previous success. The size of a seller's inventory is not a valid gauge of their abilities (or lack of).
Is a "high end" dealer financially secure by default? You'd be surprised how often those guys need extended terms or need to borrow cash from other dealers to pay for their purchases.
Authorized dealer for PCGS, PCGS Currency, NGC, NCS, PMG, CAC. Member of the PNG, ANA. Member dealer of CoinPlex and CCE/FACTS as "CH5"
<< <i>Brokering only expensive coins is often dependent on the seller's finances >>
It's all that's required to get started in the high end market.
I mean if you can also look at more than one high numbered plastic and get someone else's opinion on which looks better.
The rising market will bail out the mistakes.
I'm not talking longevity here. Just how to get started and cadge some bucks and make a "name."
Big money makes the process very quick.
Corraling the coins gives you a leg up. The "eye" will develop as you discover mistakes.
A few big dumb "funds" in your pocket will REALLY do the job.
<< <i>Anaconda appears to be a dealer that jumped in on the high-end. I do not know how financially successful he is (they are), but he certainly has increased his presence on the show circuit, at auctions, and in the numismatic publications over the last few years. >>
So it is only a matter of time before Brandon branches out on his own or becomes partner.
what happens to the rest ;-)
I give away money. I collect money.
I don’t love money . I do love the Lord God.