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I got slammed by a non-customer last week. Your opinions?

19 posts in this topic

Here's a scenario that I would like to get your opinion on. It is true in essentials, though I've simplified details to clarifiy the math.

 

I have a coin in stock on my website, and priced at $1350. Let's assume that I paid $1000 (net including buyer's premium) for it in a Superior auction.

 

A customer calls wanting the coin, but thinks my price is too high. I explain that I need to make about a 10% margin to stay in business and make a reasonable profit. I further explain that I generally start my coin prices at 15% above my cost, expecting to be negotiated down some 5%. The customer then whips out "prices realized" for the auction and says I'm a liar and a cheat because 10% would be only $1100, and I'm asking $1350, which is 35%. He then rudely hangs up with a parting shot that coin dealers are all alike: scum.

 

What do you think? The thing he must not realize is that, in addition to buying the coin, it cost me $1000 to travel to that show, eat lunch, stay in a cheap motel, and pay for the table. Isn't it fair for me to distribute those costs into the cost of the coin too?

 

PS: This guy is not a current customer (that I know of), and I was completely polite during the conversation.

 

James

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I think you set yourself up for it by quoting percentages. Either don't quote firm numbers or, if you insist, say you mark it up that much after allocating your show overhead to the coin.

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James, it's obvious that he is not a customer. If he had wanted the coin so bad, why didn't he bid it to $1100 or so? If you have "Caller ID", get in touch with him and politely explain to him what you have described, here. Try to get his name, address, etc. However, if he still won't listen to reason..... tell him to drop dead! At least you'll have some pertinent information so you can block him from your site, if need be.

 

Some people just can't be pleased, no matter how hard you try!

 

Chris

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I'd ignore him and forget about it.

 

He doesn't know if you purchased the coin directly from the auction. You could have purchased it after the auction for more or less than the selling price.

 

Your profit margin is of concern to no one but you. If you're still selling the coin at a fair price, what does it matter if you're making 5% or 500%. And yes, all of your costs associated with obtaining that coin should be built into the price you want for it.

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I agree that quoting margins is probably not necessary. And customers, myself included, often forget that dealers have overhead beyond the mere purchase price of a coin. I usually hear a dealer speaking in terms of how much money they have in the coin instead of how much they paid.

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When a potential customer starts quoting prices without seeing the coin in hand, in general, he/she will not be buying your coin. From experience.

 

 

 

TRUTH

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I agree and wouldn't worry about it.Obiviously this person's business isn't worth it if he's going to get all mad at you just because you can't go any lower on a coin.

 

Although I'm starting to get a little ticked,off since you still won't let me have that 1853 half dime for $225. even thought it's an AU that you whizzed and then sent to Jom for a paint job. sign-rantpost.gif

 

 

-Hayden 27_laughing.gif

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Your mistake was even trying to bring the details of your markup into the conversation. This is of absolutely no business for the customer, and you should not have to parse your pricing in such a manner.

 

You may have bought the coin post-auction, you may be cost averaging the trip into the coin, you may be doing any number of things and the one thing that these all have in common is that they are immaterial to the price of the coin.

 

If someone thinks a price is too high, tell them what you can do and leave it at that.

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James,

 

I'm with Tom. I've had folks ask me what my cost was before as part of the negotiation, and I've always been of the mind I was entitled to a fair price if my basis was zero and the item for sale had been left to me in an estate. Fair markup based on cost might be a disservice to all, but fair price based on market is meaningful. JMO

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If the coin was valued at $750 but the winning bid was $900 but with the juice the coin's at $1000. If the selling price is at $1350 and it actually sells, what's the coin worth now? $900 or $1000 or $1350? If the coin went back up for auction, it's unlikely it would fetch that much especially when the original high bidder/winner of that same coin is not bidding and of course the end result would be less and closer to what the bid was of that underbidder in the first/recent auction. I realized that it's at the bidder's expense to pay the 15-20% buyer's fee but what is the coin's value after all that? This non-custumer does not have all these other costs to factor into the buying this coin and the coin is only worth $900 or $1000, the price of the coin won at auction.

 

Leo

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I'd ignore him and forget about it.

 

He doesn't know if you purchased the coin directly from the auction. You could have purchased it after the auction for more or less than the selling price.

 

Your profit margin is of concern to no one but you. If you're still selling the coin at a fair price, what does it matter if you're making 5% or 500%. And yes, all of your costs associated with obtaining that coin should be built into the price you want for it.

 

--------------------

- Greg, Official Message Board Ambassador™

 

Post Extras:

 

 

 

Poster: TomB

Subject: Re: I got slammed by a non-customer last week. Your opinions?

 

Your mistake was even trying to bring the details of your markup into the conversation. This is of absolutely no business for the customer, and you should not have to parse your pricing in such a manner.

 

You may have bought the coin post-auction, you may be cost averaging the trip into the coin, you may be doing any number of things and the one thing that these all have in common is that they are immaterial to the price of the coin.

 

If someone thinks a price is too high, tell them what you can do and leave it at that.

893applaud-thumb.gif893applaud-thumb.gif893applaud-thumb.gif893applaud-thumb.gifthumbsup2.gifthumbsup2.gifthumbsup2.gifthumbsup2.gifthumbsup2.gif

as per both of the above i could not have said it better myself

 

sometimes you cant please someone no matter how hard you try

doesnot matter what you paid for a coin it has to do with your feelings of pricing it for value and current market conditions the person can buy it ir pass it is a luxury item

and with coins it is in the eye of the beholder

 

in my opinion no good deed goes unpunished

 

be kind and good and you will always get your reward

 

makepoint.gifSCREWED devil.gif

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It sounds like most of the comments are basically that I shouldn't be discussing my margins with potential customers. Admittedly, that is true, although I didn't bring up the subject in this instance; it was the "customer" who was probing for information.

 

Thanks for the great comments. I learned some key points here.

 

James

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I don't care if James offered the coin in question for $10 Million. That is HIS business and some customer calling him "scum" is just stupid. If a customer doesn't like the damn price don't buy the coin. And quit WHINING! mad.gif

 

Of course, if James continues to over price coins he'll never sell any. So in the long run the MARKET will decide and he'll probably have to sell eventually at the prices discussed. Again, this has NOTHING to do with being "scum". It has to do with a reasonable agreement between KNOWLEDGEABLE people. Again, if you don't like the price, go elsewhere. Sometimes I think these insufficiently_thoughtful_persons just want to call up just to make accusations. Kind of reminds me of a certain coin message board. [#@$%!!!] like this just pisses me off... mad.gif

 

jom

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I only have a few experinces with sellers/dealers in the nickel department. I have a whole list of coins and their owners and how much they paid for them. Those instances when I've been snipped and the coin's back up on ebay with a BIN price substantially more then what the guy paid, I laugh when 2-3 months go by and sure enough, that coin hasn't gone anywhere! I'll see the same thing with coin's coming off Teletrade and showing up on ebay at a higher price. There are times I may be hurting to buy something but I'm not hurting that bad to shell out extra for a relative easy coin. I think I have gone crazy with bidding on two coins in my life, a 1939 T2 medium frosted proof and a 1950-D 6 stepper. In those two instances, it was bid away and don't look back! 27_laughing.gif

 

Leo

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You are in business, you wouldn't be (or wont be for long) if you didn't make money. Tell him the lowest possible price you can accept for it and thats all. If he asks why it is so much just tell him "that is my pricing structure, thats as low as my business expenses will allow me to go and still stay in business" if they don't like that answer and want more details (like your margins) then you just tell them "I am sorry, but I guess we just can't do business, have a good day" and hang up the phone. If he really wanted the coin he would have bought it.

 

Sure it sounds rude, but I gaurantee you that if you call any other business and ask about their margins you will be hung up on much faster and much less polite than that.

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The caller was just nutty in expecting an exact mark-up over your paying price. Your asking price is your price. If he does not like it, he can go try to find it from another dealer. What if you got the coin for $500 in auction while the normal price would have been $1000? Then 10% over your price would be too low. You made the effort to go to the auction, look at the coins, determine which were the best to bid on, and made the final high bid. After the coin is yours, you can set your own price.

 

The only time a buyer would have a set price over your price is if you were acting as his agent in the auction.

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((("that is my pricing structure, thats as low as my business expenses will allow me to go and still stay in business")))

 

GP, that's brilliant! I'm going to use that!

 

(((with the juice the coin's at $1000. If the selling price is at $1350 and it actually sells, what's the coin worth now? $900 or $1000 or $1350?)))

 

Leo, that's a great question, and one I hadn't considered. I guess the answer would depend on the time and place of a potential sale.... If the greysheet or Trends were based on transactions like this, which number would they use?

 

James

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I am not a dealer and don't ask a dealer what he/she paid for a coin. I ask will the price and offer (in this case) maybe $100. less, expecting a counter offer. What the dealer paid for the coin is irrelevant. What is relevant is, do I want the coin and what is it worth to me.

 

Besides, had I wanted the coin at auction, I would have bid on it.

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am not a dealer and don't ask a dealer what he/she paid for a coin. I ask will the price and offer (in this case) maybe $100. less, expecting a counter offer. What the dealer paid for the coin is irrelevant. What is relevant is, do I want the coin and what is it worth to me.

 

Besides, had I wanted the coin at auction, I would have bid on it.

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As a collector myself, I feel you hit it right on the head OT3, and I also think it’s just plain rude and really bad form for a buyer to try negotiate a deal for a coin in that manner. screwy.gif

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