Has NGC Gone Insane? 1 1

[gmarguli]

NGC and NGC Ancients Announce Revised Services and Fees

• Unlimited Value WalkThrough tier – fee changed to $350 + 1% (Was $300 + 1%)
• WalkThrough tier – fee changed to $250; Maximum Value changed to $25,000 (Was $150 and max value $100,000)
• Express tier – fee changed to $100 (Was $65)

Therefore:

• Any coin valued $3,000+ will cost $100 to grade.
• Any coin valued $10,000+ will cost $250 to grade.
• Any coin valued $25,000+ will cost minimum $600 to grade ($350 + 1% which is a minimum $250).

Clearly NGC has a much better insight into its business than I do, but I gotta say, NGC I think you're f***ing insane!! I'm flat out offended at those fees.

And reducing the max value from $100K to $25K for the WalkThrough tier... Fees go up "due to inflation", but the value limits stay the same or go down. 

Greed will open up the market to competition. History has shown this over and over again. 

[Joydeep]

Due to the enormous delays, I grew skeptic as to what the thinking and strategy was. I sincerely hope this was not the plan all along. I see even the Early Bird Tier has been already updated to $38 from $35.

 

 

[RWB]

Businesses make their decisions based on present and anticipated outcomes. Consumer's make similar decisions, but each entity is an individual. Capitalist markets.

[World Colonial]

Do they provide an authenticity guarantee on ancients?  My understanding is that they don't. 

I don't collect ancients but don't see much point to paying to have the coin in the slab without it.  If the marketability is really that much better without it, not sure why.

As for fee increases generally, I have said for a long time that the TPG business is eventually going to mostly price itself out of its market.  Pricing has purportedly improved recently but I don't believe it will last (if it even applies now) to enough lower priced coins where volume will grow.  I expect it to shrink over time as an increasingly poorer collector base = (mostly) stagnant market = grading fees exceeding or representing a disproportionate percentage of the coins most collectors submit.

[Henri Charriere]

[This is why I have always felt it was cruel to dismiss an unreceptive and intransigent member with the dismissive suggestion, in substance, Well, why don't you just send it in and when you get the results post them here for all to see.

Submissions for formal grading or a coroner's report, costs money.  Lots of money.  Much more money than your average collector realizes. (I suspect the new Services and Fees schedules may become yet another factor in longer than usual turn-around times since they are obviously not reflected on the Submission Forms distributed at the beginning of the year.  I also feel the pandemic and the financial burden it placed on TPGS was and continues to play a part in residual delays.)

I have heard many different figures cited to discourage the routine submission of plainly common coins.  I guess we will all just have to see how this plays out. The sad sorry truth is on the continuum of all coins ever minted, encapsulation does not make financial sense.]

[EdG_Ohio]

Well, they do have a new building to pay for.....but in the same breath I'm not no where near the level of numismatics as many here and the fee change seems drastic when it comes to those. I recently renewed my membership so I have another year to ponder all of this or until I use up my "credit" with them.
Life, ain't it funny.

[GoldFinger1969]

It might be a good sign that NGC is raising prices, just like the private equity investment in CU/PCGS.

It means that demand for grading services is increasing.  I know that those of you who actively submit are not happy, but it's a potential inflection point that we might look back on in a few years and say "Hey, in retrospect, it was a bullish sign for gold and/or coin prices."

Time will tell...........

 

[GoldFinger1969]

Is that "Maximum Value" per coin or to each group of coins you submit in total ?

Edited May 14, 2021 by GoldFinger1969

[Henri Charriere]

@GoldFinger1969 I must say I admire your eternal optimism.  I have a sneaky suspicion that if there is an undisclosed ulterior motive here, it may be to encourage the public to buy already encapsulated coins. Funny how collectors will pay $200 for a $100 encapsulated coin but will pay $100 for a coin they already know will probably have to be certified, for another $100.  Very interesting hobby.

[World Colonial]

12 hours ago, Quintus Arrius said:

have heard many different figures cited to discourage the routine submission of plainly common coins.  

Can you elaborate on this extract from your last post?

A PNG dealer where I live (ATL Metro) told me Heritage changed their fee structure to discourage consigning lower value coins; his claim below $250.  I don't know if this is true but this makes some sense if the margin on it is much lower.

12 hours ago, Quintus Arrius said:

I guess we will all just have to see how this plays out. The sad sorry truth is on the continuum of all coins ever minted, encapsulation does not make financial sense.

The second sentence is exactly my prior point in discussing this subject.  The problem for the TPG business model when comparing it to auctions is that, a coin can and needs to be sold repeatedly.  Conversely, resubmitting the same coin over and over again is a complete waste of money.  With the some coins since the "hobby" has been financialized, it's become necessary to do it due to changing grading standards, "+" grades and maybe some other factor but this is purely financial.

I already know that NCLT represents a noticeable percentage of volume but that's low margin. 

Volume of potential US classics of any meaningful value?  I read conflicting accounts.  Going by PCGS Coin Facts, it's still noticeable but doesn't seem material for TPG revenue.  Lower priced US classics it's mostly a complete waste, especially if dated prior to 1955 with the higher fee.  Same for US moderns.

World coinage?  The volume doesn't exist and most collectors outside the US don't like it, at least yet.  The overwhelming percentage isn't worth enough to make it worthwhile and the overwhelming probability is it's going to stay that way.  Ancients is even less volume than world.

[World Colonial]

10 hours ago, GoldFinger1969 said:

Is that "Maximum Value" per coin or to each group of coins you submit in total ?

It's per coin.

[World Colonial]

11 hours ago, GoldFinger1969 said:

It might be a good sign that NGC is raising prices, just like the private equity investment in CU/PCGS.

It means that demand for grading services is increasing.  I know that those of you who actively submit are not happy, but it's a potential inflection point that we might look back on in a few years and say "Hey, in retrospect, it was a bullish sign for gold and/or coin prices."

Time will tell...........

 

What you are describing is part of the financialization of "collecting".

Since I infer you have never submitted, let me give you an indication of the cost.  This afternoon, I'm sending my first submission to NGC in several years.  Two coins under the World "Standard" tier @ $38 each and six coins for conservation, one which I have requested to be regraded.  (It appears to have developed a spot in the holder.) 

For these eight coins, about $400 to grade three and conserve five.  I want to see the conserved coins first before I have it graded because any "details" coins are possibly worth less in the holder.  But if I had the five graded now to avoid duplicate postage, add another $110 @ $22 each under the World "economy" tier.  So basically, in the vicinity of $600 when the coins are worth $4000 to $5000.  Without conservation, still around $400.

In 2005 when I first submitted, World "economy" was $15 with a 10% discount for Collectors Society members.  That's a 60%+ increase.  Somewhat less for World "standard".  Yes, I know TPG expenses have gone up but most coin prices have increased a lot less (if at all) during this time.  I don't submit as many coins as I did partly due to this reason and I don't think I am an outlier either.

The point I am making is that it's a noticeable proportion of the value of the  coins most collectors buy.  The coins they own aren't going to be appreciating substantially either anyway.  Very few collectors proportionately own Saints (or coins in that price range) as a collectible.

Edited May 14, 2021 by World Colonial

[GoldFinger1969]

14 minutes ago, World Colonial said:

A PNG dealer where I live (ATL Metro) told me Heritage changed their fee structure to discourage consigning lower value coins; his claim below $250.  I don't know if this is true but this makes some sense if the margin on it is much lower.

I'm not surprised, as the old 80-20 Rule might apply and it might even be 90-10:  90% of the value from 10% of the coins/consignments.  You can probably quantify this from all the weekly auctions they have as the numbers range from a few hundred to a few thousand.  While lots of lower-priced stuff adds up, they are much more labor and time-intensive.

I myself never did anything other than Ebay up to about 2 years ago.  I suspect many are learning about HA and GC and maybe even other sites.  It's fun...it's easy....saves time....you can easily justify the higher prices/commissions if you find the exact coin that in the past would have required half a dozen trips to the LCS's or Coin Shows.

[Hoghead515]

Wonder what will happen if u already have coins scheduled to be graded during this change? I have some and have already been charged that have been scheduled to be graded. Do you reckon they will go back and charge more?

[GoldFinger1969]

7 minutes ago, World Colonial said:

What you are describing is part of the financialization of "collecting".  Since I infer you have never submitted, let me give you an indication of the cost.  This afternoon, I'm sending my first submission to NGC in several years.  Two coins under the World "Standard" tier @ $38 each and six coins for conservation, one which I have requested to be regraded.  (It appears to have developed a spot in the holder.)   For these eight coins, about $400 to grade three and conserve five.  I want to see the conserved coins first before I have it graded because any "details" coins are possibly worth less in the holder.  But if I had the five graded now to avoid duplicate postage, add another $110 @ $22 each under the World "economy" tier.  So basically, in the vicinity of $600 when the coins are worth $4000 to $5000.  Without conservation, still around $400.  In 2005 when I first submitted, World "economy" was $15 with a 10% discount for Collectors Society members.  That's a 60%+ increase.  Somewhat less for World "standard".  Yes, I know TPG expenses have gone up but most coin prices have increased a lot less (if at all) during this time.  I don't submit as many coins as I did partly due to this reason and I don't think I am an outlier either.  The point I am making is that it's a noticeable proportion of the value of the  coins most collectors buy.  The coins they own aren't going to be appreciating substantially either anyway.  Very few collectors proportionately own Saints (or coins in that price range) as a collectible.

Thanks WC, very informative.   I was under the impression that the actual cost per coin was much lower -- basically, around $15-$20 for the slab itself and maybe the same amount to grade.  Clearly, it's alot more.  Maybe dealers sending in hundreds weekly get a volume discount but that wouldn't apply to individuals.

[gmarguli]

11 hours ago, GoldFinger1969 said:

It might be a good sign that NGC is raising prices, just like the private equity investment in CU/PCGS.

It means that demand for grading services is increasing.  I know that those of you who actively submit are not happy, but it's a potential inflection point that we might look back on in a few years and say "Hey, in retrospect, it was a bullish sign for gold and/or coin prices."

Time will tell...........

 

CU was purchased for the sports card business. Supposedly they have a multi-million card backlog of cards waiting to be graded.

I'm sure demand for coin grading has increased during the pandemic as coin prices increase. And I'm sure this was a well thought out, calculated decision where NGC figures (knows?) PCGS will again adjust their pricing so they are both in line and NGC believes the marketplace values their services enough to justify these prices. I have no problem paying for services that bring value, but when you feel like you are being taken advantage of it is much harder to do business with that company. 

[GoldFinger1969]

Just now, gmarguli said:

CU was purchased for the sports card business. Supposedly they have a multi-million card backlog of cards waiting to be graded.

Agreed....and those cards have to be mostly moderns (post-1980) as I would suspect classic cards were already graded.

[Morpheus1967]

6 minutes ago, Hoghead515 said:

Wonder what will happen if u already have coins scheduled to be graded during this change? I have some and have already been charged that have been scheduled to be graded. Do you reckon they will go back and charge more?

No, they shouldn't charge you more.  Whatever was on your initial invoice is all you should be charged.  

 

Plus the fact that the new prices do not go into effect until June 15th.  

[World Colonial]

1 hour ago, GoldFinger1969 said:

Thanks WC, very informative.   I was under the impression that the actual cost per coin was much lower -- basically, around $15-$20 for the slab itself and maybe the same amount to grade.  Clearly, it's alot more.  Maybe dealers sending in hundreds weekly get a volume discount but that wouldn't apply to individuals.

Yes, volume discounts for bulk submitters.

My costs would be lower if not for the conservation but postage both ways has also increased a lot.  It can be reduced somewhat with higher volume submissions but I don't buy enough coins to do that anymore.  When the coins come back from conservation, I'll some or all back with an additional group for grading.

[World Colonial]

1 hour ago, GoldFinger1969 said:

I myself never did anything other than Ebay up to about 2 years ago.  I suspect many are learning about HA and GC and maybe even other sites.  It's fun...it's easy....saves time....you can easily justify the higher prices/commissions if you find the exact coin that in the past would have required half a dozen trips to the LCS's or Coin Shows.

I don't buy many coins anymore and seldom sell.  I used to do both a lot more but both what I see and read about eBay indicates that it's not nearly as good of an auction venue anymore.  I see mostly fixed price listings.

It's not the primary reason I changed what I collect but even if I collected something else, it's noticeable enough to change my buying behavior.  I'm not interested in buying a larger number of predominantly lower priced coins I don't even like that much and then taking a noticeable "haircut" at resale.  

This is my description of most collectors, though they may not admit it or aren't aware of it until they (try to) sell.