Starting a coin store/buying and selling silver???

[Panda Man]

Hey to all,

My father in law and myself are thinking of starting a coin business, and would like to hear from someone in the business on some ideas or advice.... We have a pretty large collection of coins ranging from modern to Morgan CC dollars etc... Is this a good time to do this??? What would be a estimated start up cost??? Any opinions welcome......

 

Sincerely

 

Shane

[ldhair]

I would start by figuring out the cost of a great location. That will probably be your largest on going cost. Safes, cases, alarm and signs will cost a lot as well.

 

Don't forget, you will need lots of cash to buy with. In my city, I would guess 300K to get the doors open and 300K to operate on.

[JStull]

I just gave this advice on another thread of someone thinking of starting their own coin business:

 

Invest many years in studying grading of coins. If you can't grade coins, you won't have a successful business.

 

Welcome.

[Raisethis2]

If you open your business in a heavily populated older neighborhood you'll get walk in's wanting to sell anything they can to survive. The bulk of your time is spent buying from these walk in's. If you're in a new development the residents may never have seen a Morgan Dollar before.

 

Be prepared to warehouse things you buy for 30 days or more. The cops will require this to ensure the things you buy aren't stolen.

 

Some communities have huge fees for companies buying/selling gold. Look before you leap. As a Dealer you'll have a fair number of transactions with other Dealers also. Friends in the business is a huge plus.

 

On the numismatic side you'll get some regulars trying to fill want lists. If you're resourceful and fairly priced, they might even come back. You'll live on the computer once you get going. You'll need to hunt for things you need and communicate with other Dealers and the like daily.

 

[Bugmann1974]

I have heard in the past, "If you want to make a small fortune in the coin business you need to start with a large fortune"

[truthteller]

Hey to all,

My father in law and myself are thinking of starting a coin business, and would like to hear from someone in the business on some ideas or advice.... We have a pretty large collection of coins ranging from modern to Morgan CC dollars etc... Is this a good time to do this??? What would be a estimated start up cost??? Any opinions welcome......

 

Sincerely

 

Shane

 

Unless you have worked together with your in-law in the past, I would avoid it. Business tends to make a bad combination with relatives.

 

The coin shop business is on the decline. I know of several long time coin dealers who have closed up the physical location and moved exclusively to the internet.

 

Then, there are the ultra scams of fake everything walking though the door.

 

Then, there are the criminals who will shoot you down in the store.

 

But, if you insist on a B&M, make sure you are well capitalized and have a ready outlet for bullion.

 

 

TRUTH

[Dcoin]

I saw a great system that this guy had going. He had feeder storesfronts that wer small and run by one person behind glass. Low overhead and just for buying.

 

Then they would all feed into a selling store in the nice part of town. It really worked for him.

[CyberspaceVoid]

I saw a great system that this guy had going. He had feeder storesfronts that wer small and run by one person behind glass. Low overhead and just for buying.

 

That actually sounds like high overhead to me ... all those rents and salaries! It might be profitable, however, if they only bought bullion and the employees were smart, honest, motivated, and trained enough to recognize the good from the bad ... but at minimum wage I doubt it

[Panda Man]

Thank you for all the replies, it is very helpful. Is there anywhee I can go to learn more about the coin business? Also, someone mentioned 300K+ another 300K, I think that is a bit high, unless I was in New York City...Please keep the advice coming, we haveanothe partner who is in the uction business and does quite well and he will be in this with us.

I feel their is a great opportunity for buying and selling gold and silver at least right now.

I would really like to get into the business even if it means working for a reputable dealer for a few years to learn the ropes a little more....

[physics-fan3.14]

Lunar, I don't really know you, as you don't post a whole lot over here. However, I would STRONGLY caution you on the business side of the coin hobby unless you have been deeply involved in the hobby for a long time - learning the ins and outs, learning how to grade, learning about various market segments, learning about the intricacies of certain series. Unless you want to specialize in modern coins, I highly recommend you read at least a couple of books on each series you intend to deal in - the knowledge you gain will save you tremendous amounts of money.

 

Most of us on this board are collectors, so we cannot give you the real information you need. I would go to numerous coin shows and talk to the dealers there - build a network, build a reputation, build a knowledge base. It might seem like fun to become a coin dealer, being a cool hobby and all - but this hobby has an extremely high learning curve, and you must have a very high level of knowledge to be a good dealer (or you could just deal in plastic, like many dealers). I have a friend who recently retired from where I work and opened a coin shop, and he's been pretty successful - but he was involved in the hobby, and the local coin club, and has been a vest pocket dealer for many years. Its been a challenge, but it may be worth it if you are willing to put in the time and the effort.

[PerryHall]

Suggest that you get a job working for a coin dealer to learn the ropes if possible.

[JStull]

Suggest that you get a job working for a coin dealer to learn the ropes if possible.

 

+1

[coinman_23885]

Start online first to test the water, and if you are making enough profits, continue until you can bank enough money to start a brick and mortar shop (if you decide that you want one).

 

Edited to add: With the poor economy and the inherent security issues in maintaining a brick and mortar shop, I would hesitate to have an open store front personally, unless you made appointments for purchasing coins and used the building solely to store/secure your inventory. Even then, there would be issues. My preference would be to start an online business. In fact, I'm contemplating doing the same thing myself.

[Conder101]

Also, someone mentioned 300K+ another 300K, I think that is a bit high, unless I was in New York City...

I actually think that is quite conservative, and in New York City you would probably need considerably more than that.

[Conder101]

Sorry double post

[TomB]

Also, someone mentioned 300K+ another 300K, I think that is a bit high, unless I was in New York City...

I actually think that is quite conservative, and in New York City you would probably need considerably more than that.

 

I agree. My first thought was more like $1M.

[coinman1794]

Thank you for all the replies, it is very helpful. Is there anywhee I can go to learn more about the coin business? Also, someone mentioned 300K+ another 300K, I think that is a bit high, unless I was in New York City...Please keep the advice coming, we haveanothe partner who is in the uction business and does quite well and he will be in this with us.

I feel their is a great opportunity for buying and selling gold and silver at least right now.

I would really like to get into the business even if it means working for a reputable dealer for a few years to learn the ropes a little more....

 

I would not recommend getting into the business just because of a temporary opportunity in buying gold and silver right now. If you still need to learn about the coin business, it is NOT time for you to go into business. This is not a business you can jump into. Working for a reputable coin dealer for a few years, and also learning how to grade, is an excellent idea.

[Bruceswar]

From someone who is working in a brick and mortar shop, there are a few things I can tell you.

 

1. You need to have cash(or check for large purchases) on hand because you never know what will come into your doors.

 

2. Buy scrap gold and silver. It pays the bills if you do it right.

 

3. Bullion is a must in this time frame. You need to find a buy and sell spread where you can be fair to the customers but also make some money. Running a shop is not free.

 

4. Stay away from anything you do not know about even if that means you losing out on some coins. If you are not 100% sure then pass on it.

 

5. The customer is always right. If you remember this you will make many happy people. If a customer grades the coin totally wrong try not to be abrasive and brash. Educate him and them make an offer you feel comfortable with.

 

6. Treat others as you would want to be treated.

 

7. Keep want list and call people when you get things in. Customers like that. Bullion also falls under this category.

 

8. Flip Flip Flip... Keep that cash flow coming as much as possible. Coins sitting in your case are making you no money. The ones selling are. No matter how cool a coin is there is always a sell price.Some cost more than others.

 

9 People buy what they can see. Try to display as much as you can. It helps sell coins and bullion.

 

10. I cannot stress this enough. Make store hours and keep to them. Nothing worse than traveling to a coin shop that should be open only to find it closed.

 

 

If you can follow those 10 steps you will be pretty well off on the right track.

 

 

Oh one last thing... Ebay, Heritage, etc are your friends. Do not be scared to look up a coin that comes in and is unusual.

 

 

Few books to have on hand; Greysheet is a must. You will not make it without it.

 

Red Book

 

Currency Book of some sort.

 

World Coin Books

 

 

 

 

Good Luck!

[bochiman]

Bruceswar hit it on the head with his post.

I have walked away when I felt I was treated rudely. I don't like when coins are hid in the back....I like to look and then ask to examine what I see that interests me.....if you don't have room to display them, at least have lost/notes that folks can see in order to ask to see certain coins.

[Bruceswar]

Also I forgot to add.. Make an offer on everything even if you do not want it. Put an offer where you know you can flip it to the next guy should you need to right away.

 

If you have 20 1885 CC Morgans it might be in your best interest to offer a bit less on the next one coming in... Supply and demand... Ask your customers what they like and try to stock it...

 

One last thing I forgot to mention... The most collected series is the Morgan Dollar. That will also be your best seller so learn it well. Silver Eagles are the 2nd most collected.

[e1cnr]

Are you still in Bradenton. FL ?

 

 

I would suggest renting a table at some local smaller coin shows, to get practice ->

 

1- working with father-in-law

2- pricing items for sale

3- making offers of stuff to buy

4- networking with other dealers in general area to see how they

-- move silver

-- get material for stores (if they have one)

-- what they move as far as buying and selling

 

 

You did not say if this was a

- semi-retirement gig

- something to do cuz unemployed

- career change

or your combined income requirements

 

and how much business experience the 2 of you have

 

you need to consider location / size / employees ....

 

many small businesses turn into a bad job with low or negative pay

- you don't want that to happen

[Panda Man]

it is a retirement that i am after..... With combined experience we have 30 plus years....