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Flipping eBay Flippers

49 posts in this topic

First off, I have nothing against someone making a profit on a coin. However, it seems like prices have been going up sharply here and I can't help but wonder what percentage of it comes from people buying and flipping at two or three times the purchase price.

 

I guess I just get frustrated when I would have been the top bid only to have lost to a reseller who then post the same coin I wanted at 2x+ original price.

 

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I have sold some to them, and see them 2-3 times my sale price. And then after a few months, they find a bigger sucker to buy it from them...

 

 

you just have to snipe higher the first time, since you missed out at one price, there would be no reason to buy it soon after for twice as much.

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First off, I have nothing against someone making a profit on a coin. However, it seems like prices have been going up sharply here and I can't help but wonder what percentage of it comes from people buying and flipping at two or three times the purchase price.

 

I guess I just get frustrated when I would have been the top bid only to have lost to a reseller who then post the same coin I wanted at 2x+ original price.

 

I'm not sure that I understand the logic here. If you really want the coin then bid your maximum. If your maximum bid (i.e. the maximum amount that you're willing to pay theoretically) isn't enough, then why should you care who buys it and what it is resold for? Also, the fact that he or she asks for 2x the original hammer does not mean that he or she will get it. Asking prices are meaningless. For all we know, you both could be overbidding on the coin and with you out of the picture (i.e the first under bidder), the coin could sell for less.

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First off, I have nothing against someone making a profit on a coin. However, it seems like prices have been going up sharply here and I can't help but wonder what percentage of it comes from people buying and flipping at two or three times the purchase price.

 

I guess I just get frustrated when I would have been the top bid only to have lost to a reseller who then post the same coin I wanted at 2x+ original price.

 

I'm not sure that I understand the logic here. If you really want the coin then bid your maximum. If your maximum bid (i.e. the maximum amount that you're willing to pay theoretically) isn't enough, then why should you care who buys it and what it is resold for? Also, the fact that he or she asks for 2x the original hammer does not mean that he or she will get it. Asking prices are meaningless. For all we know, you both could be overbidding on the coin and with you out of the picture (i.e the first under bidder), the coin could sell for less.

 

Yes, and different venues and different pictures attract different buyers and different prices.

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I used to be able to buy a lot of coins on Ebay and flip for a profit....I bet I don't even win 5 coins a month now due to the reason the Op mentioned. I am not mad about it but I can't see how it's healthy for the hobby.....reselling I get but trying to make 500% profit on every coin with high BINs just seems like a totally crappy business model and one prone to failure....

 

I guess in the end I should thank them because my auction results are strong weekly because most are true auctions where the market gets to decide what the coin is worth vs....BIN's with huge asking prices :headbang:

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I'm new to the online market so please excuse me if my question seems naive...

Are you saying that these guys who are "flipping" are they enhancing the coin in anyway? Are these coins typically graded or raw?

How can they charge a 500% markup if its blast white like all other coins?

Sorry either I'm missing the whole concept or its absurd or both.

 

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no change in coin

 

example would be buy a NGC slabbed coin for $50

 

and then relist it for $150 with ?better description, picture, or location"

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The eBay model is corrupt (not that sellers and buyers are corrupt - just eBay itself). Therefore, do not use it to draw any conclusion about "market prices".

 

A TRUE auction -- not the eBay model -- tells you the truth about where prices should be.

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The eBay model is corrupt (not that sellers and buyers are corrupt - just eBay itself). Therefore, do not use it to draw any conclusion about "market prices".

 

A TRUE auction -- not the eBay model -- tells you the truth about where prices should be.

 

Can you elaborate as to why the eBay model is any more corrupt than any other auction?

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White coins don't suffer as much as do the toned coins. Since each coin us unique its whatever someone is willing to pay. The only problem is without much experience it can be hard to price them.

 

I agree Shane, I buy coins even with above fair market premiums if I like the coin enough. The last coin I bought I felt had a FMV at $350 but I gave the seller $400. Partly because they overpaid at $500 and I know I'll be keeping the coin for several years.

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I don't understand the OP's complaint. A free market will dictate market prices. I always bid my top dollar, and if someone overbids me, then that's fine. Sniping simply eliminates weak bidders.

 

Seems simple to me.

 

 

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The eBay model is corrupt (not that sellers and buyers are corrupt - just eBay itself).

 

Can you elaborate as to why the eBay model is any more corrupt than any other auction?

 

Oh that is just James being James, for years he has made it clear on these boards that he is against ebay and dislikes PayPal more than beets. He never gives us evidence as to the why ebay and PP are worse than the alternatives. Please provide evidence and please be aware that many on these boards including Krypto, Broadie, me, to name just a few, have successfully worked with ebay and PP and believe it is a sound place to buy and sell. Show us the better alternatives and don't just say 'Scotsman, we are perfect', yet again. Honestly, I think it is bad for Scotsman's buisness model for you to be bashing competition here on these boards. Seems like a huge conflict of interest. I don't see Heritage or Goldberg or Stacks employees doing this - I can't imagine why......... (tsk)

 

Best, HT

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I've never sold anything on ebay, but have bought a lot of things, including coins. Ebay is the largest garage sale in the world. You can find so many things to buy and if your astute and patient, get them for below market value. Market value being retail prices for brand new items in unopened boxes that you would have to pay higher if bought from other sites such as Amazon. Market value for coins is much more complicated.

 

I've been disappointed to lose a coin that I wanted and was sniped at "the bell", but that's just one of disadvantages of buying via auctions. I still like using ebay.

 

 

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A TRUE auction -- not the eBay model -- tells you the truth about where prices should be.

 

 

I get a better sense of market prices from Ebay sales then I do from the big auction houses because of the lack of buyer fees....plus the amount of items being sold daily far surpasses what you see even at Heritage. Couple that with the fact that there are millions of lower priced items under $50 being sold on Ebay that you would never see sold at the big auction houses due to the lack of value and higher cost of fees....I think Ebay is a far more accurate reflection of the market then most want to give it credit for....

 

I sold at least 20 coins last year on Ebay that were the highest prices realized for the date and series and some of these where white coins and all were sold via normal auctions....I believe it's simply a case of a larger buying pool hm

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A TRUE auction -- not the eBay model -- tells you the truth about where prices should be.

 

 

I get a better sense of market prices from Ebay sales then I do from the big auction houses because of the lack of buyer fees....plus the amount of items being sold daily far surpasses what you see even at Heritage. Couple that with the fact that there are millions of lower priced items under $50 being sold on Ebay that you would never see sold at the big auction houses due to the lack of value and higher cost of fees....I think Ebay is a far more accurate reflection of the market then most want to give it credit for....

 

I sold at least 20 coins last year on Ebay that were the highest prices realized for the date and series and some of these where white coins and all were sold via normal auctions....I believe it's simply a case of a larger buying pool hm

 

Lets not forget that you still hold the ALL TIME record w/ that Kennedy you sold for me (thumbs u

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For past prices I use Heritage, Teletrade, Greatcollections and Ebay. I get a good feel for the coin I'm researching from them. Also, don't understand how Ebay's model is corrupt? Been there 15 years and don't see it.....

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I'm guessing James_EarlyUS at some point had a run in with PayPal. PayPal is owned by E-Bay and since that relationship shuts out any competition, that in itself goes against a free market philosophy embraced by so many.

 

What I can say is that I seldom leave much cash in my account for 2 reasons.

 

1. If you type in MS (I like coins in slabs) the vast majority of coins are sold only using "Buy it Now" and prices typically begin at twice Gray Sheet bid. Often they are much higher. Accordingly, I rarely can buy anything from E-Bay Consignors.

 

2. A quick Google search will reveal that PayPal has frozen or confiscated funds belonging to their customers. This is frustrating, scary and is tolerated almost no where else in society. I'd never have a good thing to say if they froze my account either.

 

That said, E-Bay does have some impact upon the fair market value of coins sold in various conditions. In a true auction (like Shane's) there's less to argue about the actual value of a really eyecatching coin. His customer base sets the bar week in and week out for things I look for. Some coin series in the Coin Dealer News are almost wishful thinking type prices. Just far too low. Rarely high.

 

The "Buy it Now" does nothing in this regard since when a coin is sold at an inflated price it's not like they send out a memo. I'd hazard a guess that 99% of overpriced BIN coins go unsold.

 

 

 

 

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It is a free market so people are free to flip. I would guess most of my ebay buyers are either not losing any money or are making money on my items. I sold a 1913-s type II 5c in AU58 that was all there for around $500 this week as well as a 1914D 1c VF35 for $400, both NGC and conservative for grade. I could see them upgrading elsewhere.

 

I sold two Washington quarter sets (83 coins) with key dates certified for $550 and $450, both customers were happy. I had a Mercury dime set, with key date certified get returned. Sets are not easy to sell and make money especially if they are nice and you have to pay top dollar for them.

 

I would like to see a number of numismatic auction houses merge to compete with ebay and offer buyers and sellers a numismatic edge over the dime store stuff that makes up a good bit of feebay's material.

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[quote=

I would like to see a number of numismatic auction houses merge to compete with ebay and offer buyers and sellers a numismatic edge over the dime store stuff that makes up a good bit of feebay's material.

 

I believe the way ebay does business dooms them mostly dime store material, as you so accurately put it. If I am looking at buying another mid 3 figure or higher priced coin from a dealer, I'll go to the dealer's web site. I'm sure you will agree, once we have eliminated the ebay fee and also the PayPal fee, it gets much easier to give the buyer a discount.on their purchase.

When the fees got too high, the "good" business moved on. Such is the penalty ebay pays for greed.

Regards,

 

Doug D

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A TRUE auction -- not the eBay model -- tells you the truth about where prices should be.

 

 

I get a better sense of market prices from Ebay sales then I do from the big auction houses because of the lack of buyer fees....plus the amount of items being sold daily far surpasses what you see even at Heritage. Couple that with the fact that there are millions of lower priced items under $50 being sold on Ebay that you would never see sold at the big auction houses due to the lack of value and higher cost of fees....I think Ebay is a far more accurate reflection of the market then most want to give it credit for....

 

I sold at least 20 coins last year on Ebay that were the highest prices realized for the date and series and some of these where white coins and all were sold via normal auctions....I believe it's simply a case of a larger buying pool hm

 

I will agree with you largely, but will also note that your sales are not necessarily representative of the larger eBay market. First of all, your photography is superior even to that used by larger houses such as Heritage. Second of all, your integrity is unimpeachable and you are well known as a honest dealer. This has created a following that I believe in many cases can lead to higher prices than one would see from a larger auction venue or the run of the mill eBay seller.

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The eBay model is corrupt (not that sellers and buyers are corrupt - just eBay itself).

Can you elaborate as to why the eBay model is any more corrupt than any other auction?

Your question doesn't logically follow my statement, because eBay is not an auction. I only meant that the eBay business model -- whatever it is -- tells us much less about the state of the market than a true auction (model). They are different models.

 

I never, ever go to eBay to get a sense of market value for something, but do look at past auction results from Heritage, Stacks, Goldberg and our own, just to name a few.

 

Oh that is just James being James, for years he has made it clear on these boards that he is against ebay and dislikes PayPal more than beets. He never gives us evidence as to the why ebay and PP are worse than the alternatives. Please provide evidence and please be aware that many on these boards including Krypto, Broadie, me, to name just a few, have successfully worked with ebay and PP and believe it is a sound place to buy and sell. Show us the better alternatives and don't just say 'Scotsman, we are perfect', yet again. Honestly, I think it is bad for Scotsman's buisness model for you to be bashing competition here on these boards. Seems like a huge conflict of interest. I don't see Heritage or Goldberg or Stacks employees doing this - I can't imagine why......... (tsk)

EBay is not Scotsman's competition. You didn't post anything sensible for me to respond to, and I have no idea why you are attacking me on the boards.... yet again.

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A TRUE auction -- not the eBay model -- tells you the truth about where prices should be.

 

 

I get a better sense of market prices from Ebay sales then I do from the big auction houses because of the lack of buyer fees....plus the amount of items being sold daily far surpasses what you see even at Heritage. Couple that with the fact that there are millions of lower priced items under $50 being sold on Ebay that you would never see sold at the big auction houses due to the lack of value and higher cost of fees....I think Ebay is a far more accurate reflection of the market then most want to give it credit for....

 

I sold at least 20 coins last year on Ebay that were the highest prices realized for the date and series and some of these where white coins and all were sold via normal auctions....I believe it's simply a case of a larger buying pool hm

 

I will agree with you largely, but will also note that your sales are not necessarily representative of the larger eBay market. First of all, your photography is superior even to that used by larger houses such as Heritage. Second of all, your integrity is unimpeachable and you are well known as a honest dealer. This has created a following that I believe in many cases can lead to higher prices than one would see from a larger auction venue or the run of the mill eBay seller.

 

I believe it's wrong to lump a venue with so many different sellers in it under one heading, such as Dime Store. I prefer to think of ebay as a website, and the vendors on it as individual companies that do business in the manner they individually see fit...because that is what they are.

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Exactly. That is exactly why I specifically said in my first post that the eBay business model is corrupt, but not the buyers and sellers themselves (necessarily). (I guess HardTimes chose to ignore this while preparing his attack on me.)

 

Someone might be able to take a slice out of the eBay model and make reasonable assumptions about that corresponding slice of the market, because there are honest buyers and sellers out there, for sure. But as a whole, I have not gotten any data that I would trust from eBay in at least four years.

 

Prior to that (in other words, before PayPal/buy-it-now/etc. destroyed whatever integrity was left in the business model), I DID use eBay -- FREQUENTLY -- as a gold mine of data.

 

Edited to add: Incidentally, just for the record (and HardTimes will not be able to handle this, I am sure), I have from time to time advised folks coming into the shop not to sell certain items to us, and instead to give eBay a try. There are definitely items for which the eBay business model works to a seller's advantage over a true auction.

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I would be interested in hearing how ebay is not an auction. I feel that within the advancement of technology it is layered a little different but the underlying result is that of an auction. Logistics are different of course but thats like saying Amazon isnt a store like Woolworth's was.

 

I too think ebay has its problems though. But at the end of the day the other auction houses have gotten too greedy to offer an alternative. I would never sell at any of those places under the current fee schedule. That being said they do eliminate some of the problems with ebay but couple the bad pictures as a disservice to the seller and I just dont see the advantage.

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I would be interested in hearing how ebay is not an auction. I feel that within the advancement of technology it is layered a little different but the underlying result is that of an auction. Logistics are different of course but thats like saying Amazon isnt a store like Woolworth's was.

EBay is not a TRUE auction. But some aspects of eBay may have characteristics of an auction.

 

I'll put it this way. Here are some aspects of a true auction that I think do not apply equitably to eBay (note I am speaking only of coins, as I've never visited any other part of eBay):

 

1. "true auction"

In a free market, a "true auction" means the opening bid is zero, and there is no reserve. Thus, the offered item WILL SELL no matter what, to whomever is the highest bidder. That most accurately reflects the TRUE market, as it shows the most somebody is willing to pay for something.

 

2. Returns

Typically, all sales are final with an auction house. After all, if you didn't really want it, why did you buy it? Paypal corrupts this aspect because as I understand it, it's easy for buyers to return items, and it happens frequently.

 

3. Payment method

I know of no auction house that won't readily, and preferably, accept cash or a personal check, as well as credit cards. Paypal corrupts this aspect as the ONLY payment method endorsed by eBay.

 

4. Starting bid

I never go to eBay specifically at all, but am sometimes led there by links in various online venues (including the boards). When I do go there, it appears to me that "buy it now" is all over the place, and hardly anything seems to be set up as a true auction.

 

If I take a normal cent out of my pocket and list it for sale on eBay at $99,000, how does that tell someone anything about the true market? Is it worth $99,000? Or only $10,000? Or only $37.50? Or only 1cent??

 

5. Competition

In an auction venue, you generally know who you are bidding against -- another bidder or the house. Of course, online bidding can make it difficult to "see" who you are bidding against. On eBay, all other bidders are always completely anonymous.

 

Contrary to whatever got HardTime's dander up, I NEVER stated that auction houses are "perfect". I have no idea where he got that from (guess he made it up). Rather, I compared eBay to a "true auction" model, which means in effect a free market system, and eBay is indeed vastly corrupt compared to a pristine system.

 

But let's not be unrealistic, here. To cut right to the chase, the "auction house" model today is NOT free from corruption, either. Taking a sizable amount of the sale in terms of a "buyer's premium" (15%, 17.5%, whatever) does in fact corrupt the true free-market model, and the larger that premium, the more corrupt that model becomes.

 

However, at least in the "auction house" model, you can manage the number of parameters prone to corruption of the model. Pretty much the buyer and seller premiums are the only way an auction house can manipulate the model (provided they do everything else legally). The eBay model has many more factors: Paypal, buy-it-now, returns, rampant shill bidding,

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Let's see what eBay has to say about eBay. This is from their page entitled Who We Are":

 

"With more than 100 million active users globally (as of Q4 2011), eBay is the world's largest online marketplace, where practically anyone can buy and sell practically anything. Founded in 1995, eBay connects a diverse and passionate community of individual buyers and sellers, as well as small businesses. Their collective impact on ecommerce is staggering: In 2011, the total value of goods sold on eBay was $68.6 billion -- more than $2,100 every second. For the latest stories about eBay, including recent financial performance, visit our ... "

 

I do not see "auction" anywhere, either implied or specific.

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eBay decided around 5+ years ago, they want to be bigger than Amazon or Wal-Mart.

 

They changed their pricing structure so that online 'stores' could have a large virtual presence and still be cheaper than renting space in many shopping malls.

 

Although in the coin section there is still a good deal of 'true auctions' (what I would call absolute with no reserve) - many have noticed that there are many more fixed listings or starting prices already at retail.

 

There can still be bargains found - like when people place their Morgans in the diaper section or have a BIM that is less than half retail (besides the cherry picks in regular auctions).

 

The only way to say the true value is found from auction IS if their are at least a couple bidders willing to pay true value - which frequently is not the case at any auction, except possibly the very specialized and well publicized auctions.

 

Of course Ebay is an auction site in competition with Scotsman, Heritage, Stacks, Greatcollections, Teletrade - but BARGAINS can occasionally be shown at any of those sites.

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Thanks for the answer James.

 

I agree with some of what youre saying but most of your list is logistics. Its a matter of technology advancement. I can buy a car online. Does that mean buying a car is no longer buying a car because it used to be that I had to go to the dealer and talk to a salesman?

 

What difference is there really if you start a 1000$ item at 99 cents or 0?

 

They dont call themselves specifically an auction house because they are in fact a marketplace in that they offer many other formats. Think of it this way. The listings that are auctions, are no different than your regular auction house except there is one lot per auction.

 

Your stance reminds me a lot of an online poker analogy. Is online poker still poker in your opinion? You cant see people, you can play many games rather than just one et cetera...there are many similarities in that comparison but at the end of the day you get 2 cards, you bet money an you win or lose.

On ebay you see any item. You decide whether you want it and at what price, and if no one else wants it at a higher price you win it. Thats an auction in my book.

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