Coin Market Slow - Numismatic Coins Weak

[Houston Investor]

Many Dealers I have talked to in addition to my own opinion seem to confirm that due to the slow economy Coin Sales at shows and online are very weak.

 

The consensus of opinion seems to be as expressed by one dealer at a show next to me at a recent show "If I can't get more than 90% of Bid for this stuff on Ebay I am not offering more than 50-60% of bid to walk up sellers. Let them sell it somewhere else" This is an extremely bad time to be trying to sell coins unless its Bullion or some hot US Mint Issue. I don't think the Stickering Gimmicks are even going to sell slow moving big ticket coins or coins with black sports are tab toning that look like they have been run over by a truck. Most buyers prefer coins which are brilliant with nice luster and back away from toned coins especially with those with black spots sticker or no sticker. I will not buy coins with black toning or spots and I dont care who's sticker or plus sign it has. I only buy coins that are nice in terms of what my customers will buy, that make the grade according to my standards, and which I can purchase at an amount which allows me to make my busines ROI goals.

 

What say ye? Do you think the market is really weak? I am talking about the real coin market (not the constant CDN Hype or the market for rich people).

 

 

[Walkerfan]

I definitely think that it's a buyer's market. Rare key dates continue to peform well but others don't as much. I agree with most everything that was said. I have seen alot of stickered garbage (ugly toning and poorly struck stuff). Buyers do prefer mosty white coins that are lusterous. Toning is GREAT just as long as it is colorful and not too dark or splotchy. Nice colorful toning that is non all-encompassing will command a premium. The market is not unhealthy but I DO think that it will rise and improve down the road. I surely don't expect prices to go DOWN any more than they already are. Bullion is certainly outperforming rarities at the moment. IMHO.

[physics-fan3.14]

Absolutely a buyers market - unfortunately, fresh coins are drying up. Would you want to sell into this market?

[leeg]

I feel a truly nice coin will sell in any market. I'm not talking big money coins either. If you bought the coin at the right price you can sell at a fair price so as not to lose your britches.

 

As a case in point, I was going to sell some coins here on the Money Market then backed out because my sell situation changed. I had numerous PM's and even emails requesting prices for some coins in my collection.

 

I'm also a fan of toned coins and feel they do well in the market:

 

 

 

 

[ron consults-migration]

in general i've found that if you can get 80% of a coins "value" you are doing well...i currently buy "cheap" stuff via a newspaper ad - old collections, piggy banks, coffee cans of indian cents, buffalo nickels, wheaties, etc....put them in lots(baggies+stickers+index card w description)...hire an auctioneer @ 15% and off you go.....i've made way more doing this than i ever made trying to turn over higher end coins....although i once bought the 1995 Eagle set for $1350 and didn't do too bad...sold for $2400....if you do this as a business you must be good at spotting opportunity when it arises (example-when the gov first started making the "states quarters") Heck you did not even have to do any marketing as the gov was doing it all for you to the tune of $300 million!! I've collected since 1964 at age 12 so i've lived through a lot of changes in numismatics, and i know i have not seen it all yet....

[Dcoin]

This is what I my interpretation of his quote....

 

"The public is no longer a sucker on two legs that will buy anything behind glass. Customers are more selective about the eye appeal of their coins. Unless you are specializing in modern 70’s or 90%, a dealer is going to have to bring their A game when buying. Can you please pass the ketchup?”

 

Did I hear right?

 

[Hard Times]

If you buy rare coins, not the common stuff that almost every seller on the bourse or ebay sells, problem free, good or great for the grade examples are hard to find at present. Alot of dreck or common is out there, and you folks say they don't sell well right now. That might be, but the coins I collect, which I would like to think are of the former variety (rare, quality for the grade), I win at auctions right now from just above wholesale ask, to well above MV in the established pricing guides. Folks still want these and bidders go strong. At the Houston Money Show, when I would find such examples on the bourse, dealers were never close to being at a 'low price' of MV, and in some cases multiples above MV. Bid, as you call it, was a pipe dream for such quality. I found the prices so high I can't believe anyone was buying and I did not. I will just bid my time, find quality at auction and see what values they reach. Coins find their price, if you can't sell dreck or common at 80% bid, well they ain't worth that. Apparently most numismatists are now astute and experienced enough to have figured this out. Unless there is a flood of newbies with money to burn in the nearest or farthest future, that ain't a going to change. Quality sells, common, dreck don't. Best I can tell anyway is why many are having trouble selling what they have to sell.

 

Best, HT

[DirtyGoldMan]

I just sold some coins from my core collection on the BST ATS and nearly everything sold at my price and very quickly. Nearly everything was CAC-stickered, and most were NGC and PCGS graded gold coins. I guess people are avoiding the dreck.

[Hard Times]

I gotta start looking BST ATS more often, congrats Sage!

 

Best, HT

[michael]

 

in general terms as there are exceptions to the rules

 

 

1--great eye appeal coins

2--PQ/strong for the ngc/pcgs slabbed grade

3--with other superlative/outstanding qualities for the specific coin in question

4--really scarce to rare coins

5--pre-1880 good ; pre-1860 better (thumbs u; pre-1840 best pre-1807 even better coins

6--fresh to the market coins

 

coins are in strong demand $$$$$$ with money waiting to buy RIGHT NOW!!

 

and yes a cac sticker might help demand if the slabbed coin has most all of the above 1-6 cant hurt to have another set of eyes verifying your coins and principles of the stickering service posting thousands of buy bids on coinplex and the cce for stickered coins

 

 

the other 95% plus or minus of the market

is soft

 

at many times a discount sometimes a HUGE discount to greysheet bid prices with some problematic coins sometimes having no market at all; at times

 

 

what makes the market soft is the fact that buyers be it flippers/dealers/collectors etc. that bought coins in the other 95% of the market are worth less to much less currently compaired to what they paid

 

 

market can become strong for everything

 

AT NEW PRICE LEVELS which of course many refuse to accept

 

how long will this go on??

 

 

time will tell

 

remember have fun with your coins

[Houston Investor]

At present I am mainly a buyer in this market as it may be a great time to buy. I sell if the price is right and generates positive P&L. If your selling I would recommend against letting it go at no reserve 99c on Ebay or something like that.

 

My major focus at shows is finding nice better date coins which are solid quality. I have had to pay a lot for them but sometimes but this is a given unless the price is really unreasonable. I agree it is tough to find really nice "good stuff."

[Hard Times]

At present I am mainly a buyer in this market as it may be a great time to buy. I sell if the price is right and generates positive P&L. If your selling I would recommend against letting it go at no reserve 99c on Ebay or something like that.

 

My major focus at shows is finding nice better date coins which are solid quality. I have had to pay a lot for them but sometimes but this is a given unless the price is really unreasonable. I agree it is tough to find really nice "good stuff."

 

I just finished my last two auctions on ebay before closing down my store - I was very successful and did well for this past year, but shut down because my day job takes alot of time. I gotta say, these two last auctions were characteristic of how I operated my ebay store - quality for the grade certified coins, high resolution images, and the customer first. Both of these coins, started at no reserve 0.99c, went for over the market values listed in Coin World, Numismedia, and PCGS price guides. I consider that to be pretty darned positive and shows it is a great time to sell, if you sell honestly and quality. If folks see this, folks will bid strong on what you have to sell. If on the other hand, you sell dreck and common stuff, with bad images and a reputation of not caring about the customer, then maybe you are right, not the time to sell......

[Houston Investor]

When people aren't buying coins at a show or online, etc. the reason almost always is lack of money. And I think Augustus has a really good answer why people aren't buying coins in this economy.

 

Running an ebay store is inexpensive. Its only $15.95 a month fixed cost and I can even manage mine from work on my I phone. I don't believe putting coins out at 99c or 9.95 is the way to go unless its really cheap material below $50. I like the idea of BIN or make offer with the computer automatically rejecting offers below the seller specified minimum offer amount. I usually set this between cost and retail (assuming this is in an acceptable ROI range) and have had good success.

 

I have had some people buy Gem BU common rolls of dimes from me at the BIN (about 25-40% above melt) which I put up for auction at 92% of melt (I refuse to start these at 99c or 9.95). I have been liquidating a lot of this as it was in the 4-5x cost profit range. Good photography and description helps.

[jom]

Running an ebay store is inexpensive. Its only $15.95 a month fixed cost and I can even manage mine from work on my I phone.

 

I can see that eBay does have a fixed cost there but do you really think eBay's absurd fees make the whole thing "inexpensive"? Just curious about your thoughts on this.

 

jom

[Houston Investor]

Jom -

 

I believe it can be inexpensive compared to the cost of coins shows - table fee, travel, lodging, ones time etc. Plus I work full time as a financial manager in the O&G industry. While I set up at shows occasionally to buy, its an expensive variable cost to set up which if not supported by adequate sales gets allocated mostly to the cost of inventory purchased. I treat coin show expenses as a variable cost allocable based on sales and purchases. Example: Recent show expenses (table fee, parking, etc) were $300 at a recent show. I had approximately $3000 in sales and $2000 in purchases. Consequently $180 ($3000 x 6%) went to variable selling expense and $120 were allocated to the cost of inventory purchased ($2000 x 6%). Many of the purchases were from walkup customers bought at a price which works for my business model in terms of what I an sell it for now. This does not take into account my time spent at the 2 day show. Its all realitve to what kind of show you would have. An out of town show your looking at $1000 in costs before you sell a single coin or banknote.

 

From the variable cost side an Ebay store (final value fees, listing, and shipping costs) it is basically 15% of sales (at least for me). It costs 20c per item (per month) to list an item (good till cancelled) so 50 items listed will cost $10 selling expense. In addition paypal adds another 3% to costs. I do agree with you their fees are steep (once all are summed to arrive at total variable cost for that month) and this is a challenging hurdle for the small businessman when contrasted against the nature of the coin market and competition from big money operators. However, the site draws more traffic than any other online sales venue I know of so its simply a matter of marking up items accordingly which have been bought right. It takes cost plus at least 40% to make it in the coin business. I keep fixed costs under $1000 (ebay store monthly fee, books, subscriptions, supplies) and I am able to make at least a 15% ROI or more.

 

Ebay can be expensive in selling Bullion Material sometimes too. If your going to incur 15% variable cost on a 1984 $10 Olympic NGC 69 coin selling it on the Bay but only realize a tad over melt (say 5% if that much) you can probably can do better selling it at a shop that say offered you 97% of melt like one I occasionally visit.

 

It takes knowing your market and being able to price coins.

[Chris1976]

I dont personally see why so many people have issues with the fees that paypal/ebay tack onto items sold through them to be honest. Every retailer out there knows that processing a credit card transaction, debit card transaction and even fund transfer processing involve fees of some sort by the financial institutions. It's part of running a business plain and simple.

 

Yet those same people that have issues with the fees from ebay as a seller dont tend to have the same ill feelings towards the "buyers premium" charged by other auciton sites when they are the purchaser, when in fact most of those fees are much higher than the sellers fees on ebay. Only difference really is that the fees fall on to the sellers when ebay is involved (same as any buisness transaction in a retail scenario) and the fees fall onto the buyers when other auciton sites are involved (think of it has a very high membership fee just to spend your money with those companies).

 

I cant see the logic myself which is why I continue to do business with ebay and the other sites without complaint. But for the most part, I only sell items though local clubs and when purchasing I either deal directly with the owner or through standard online retail shops where there is no additional fees other than the cost of shipping.

[Houston Investor]

One has to look at the total costs and overall big picture in considering a particular venue in relation to their situation. What works for me as someone with a full time good paying job may not be the best choice for someone else.

 

One day, If I am retired with nothing to do but travel to shows I may find I prefer the show circuit.

[jesbroken]

Ebay became popular for the average person who wanted to buy something without instore hassles, no traveling involved and almost no expense at the time. Once it become evident to the owners that a large fortune was to be made with the venue, the costs associated with selling went up, slowly at first, but once they realized that people would continue to pay due to the extremely large customer base, they became more aggressive with their fees. Anyone selling on Ebay that complains about their fees, should figure the costs of a B&M or the associated costs previously mentioned for show exposure, but they don't, they just know it is higher than it used to be and Ebay is making a lot of money. That truly bothers a lot of folks. No one using a venue should complain about the costs associated with that venue when they are known before the auction is started. Then this is just my opinion.

Jim

[mtnstyne]

There was an attempt a while back to make Freebay but it never got off the ground. Seems like with the way social media makes it's money through marketing firms it would be easy to accomplish these days.

 

You could easily have no transaction fees and reduce the cost of doing business to the Paypal or other processing costs.

[Walkerfan]

From the buyers perspective, Ebay has changed alot as far as it's quality is concerned.

 

There used to be ALOT of good stuff before, early on (1995-2003ish) before all the scam artists started taking up residence there.

 

I will never buy raw there anymore but you can still find some good certified stuff, periodically, but it is really like a scavenger hunt and takes ALOT of time....still worth it, though. IMHO.

[Houston Investor]

I really have no complaint about the ebay costs vs other venues like a shop for instance. I do agree they have increased their fees over time probably due to their increased participation in the process.

 

When I first got on the bay in 97-98 it was really super place to retail stuff compared to many shows I set up at where there was so much competition from the big boys and shops who could sell at bid bc it walked in cheap. I did not even have to use pics to move it on the bay in those days. I made a tremendous amount of money with currency I bought at shows and online (no currency TPG's at that time). My stuff was properly graded and one of my mentors was a grader at CGC. Doing this period I develeped a considerable skeptcism of coin collectors and their TPG A is better than TPB B mentality when the currency I was selling did not even have TPG grading. At this time I was developing a considerable inventory and expertise in US Currency after being primarily in coins the previous decade. When something did have a pic they were all over it. It was obvious these people had never seen this stuff before. I have strong business, computer, and quantative skills which fit well with the online mode of operation coupled with strong show experience. There was no paypal then (and their 3% fee) and I took payment via check or money order (payment had to clear before shipping). Then when the big boys got on it things started to slowly become more difficult as more material flooded the ebay marketplace at wholesale prices.

 

At the time I first got on the Bay (97-98) a Chicago Coin shop was liquidating a large currency collection (many high quality Nationals) that probably walked into the shop at next to nothing then flipping it on the Bay. I won a lot of these notes at good prices bc I was bidding against people who really had no idea for the most part how to price currency unless it was someone like Don C Kelly (the NBN guru). These notes have been since sold (at good profit) but my favorite was an 1882 $10 Brownback in AU. It was a beautiful note and that series remains one of my favorites to this day. I remember winning a nice Choice VF large size Frost NB of San Antonio NBN on the Bay at $175. The next week at a show a NBN collector walked up to my table, looked it at it but backed off on my $350 price trying to argue about greensheet and the usual Cheap A BS spiel. I told him to go find one then. He came back about 45 minutes later and laid the $350 on my table and took the note. Its probably worth much more than that now.

 

 

[e1cnr]

December is usually a lower time on eBay for final values of stuff sold, and most items pick up to November values by the middle of January.

 

I would guess smaller and local shows would be comparable.

 

 

My thoughts are that this is due to the Christmas/Holiday season where 'extra' money is spent on gifts for loved ones rather than coins for self, and this is a repeatable seasonal trend.

[Houston Investor]

I agree flipping coins for quick profit is not easy, especially considering the costs involved in a coin business. You cant make much money if any buying and selling at wholesale (sheet prices) although I have shared tables with wholesalers who are constantly hustling the bourse flipping their material.

 

In addition, coins do not pay interest or dividends and are subject to market risk. The 1990 crash is proof of this. A coin business has to maintain cash flow so moving items quickly is a priority. The reality is many items will linger in inventory for the long term. This can drag down the business. What I have found is the people who have shops where its walking at x allowing them to buy it right can go to a show and flip it at y and make good money assuming there are people set up or walking in the door and buying those coins.