I met this dealer about 5-years ago & I have probably bought 1 or 2 nice coins from him every year. I never knew for certain, but I’ve just had the feeling that he was treating me fairly. This last weekend, I bought this nice error coin from the guy. I remembered seeing the coin somewhere before so I searched a couple auction site archives and found it. Based upon the realized auction price plus commission & postage, I calculate that my friendly dealer only marked it up 12.5% when he re-sold it to me. On this coin he made 12.5% on his money in one month and I feel good buying coins from an individual like this. Other than rounding off to the nearest $10, there is never much to negotiate with this guy. I just have the feeling that many of the coins I am offered elsewhere have been marked-up 50% to 100% or more. I get this feeling because there always seems to be some room for negotiation. What mark-up do you think you paid on your last coin purchase? Very best regards, collect89
Going to about 2 to 4 coin shows a month I've really gotten to know many of the repeditive dealers there. One thing I found out is the markup %. It appears that most of the dealers mark up coins for shows about 20% of the grey sheet prices regardless of what they paid for coins. Of course most keep records and if a coin goes down on the grey sheet, they just put it aside for a while until the prices go back up. The reason for about 20% is almost everyone that goes to a coin show knows it is a flea market for coins. Some places make it almost like a true flea market too. At one show I saw Indian relics, Baseball/Football cards, knives, etc. aside from coins. Almost any one that does go to a coin show wants to do what is known as bargaining. Chewing down the sale price. The dealers know this too so they raise the prices accordingly. Many dealers start off with I can let you have this one for 10% less than it is marked. Didn't work? OK, OK take it away for 15% off. NO? Final offer is 20% off. You think you stole it for that. He got his price, you paid yours.
What does it matter what percentage over cost a dealer marks up his coins? It's the current value of the coin that should matter. What if the dealer overpaid for his coin. Should he still mark it up 20%? Would that be a good deal for you? What if he overpaid and "only" marked it up 5% but that price was still much higher than current retail value for that coin. Would that be a good deal for you? Likewise, what if the dealer made a great purchase and got the coin for half of what he would normally pay. (Assume he bought it at auction.) Should he only mark it up 20% or should he price it at a fair retail price? To make an analogy . . . Suppose you find a $20 bill on the sidewalk. Your cost for the $20 bill is zero. Shouldn't you sell me the $20 bill for $2.50? Afterall, a $2.50 profit on a zero investment is pretty good. In other words, should your good fortune in a purchase (or a find) mean that you are obligated to sell an item for less than it is really worth?
I havent dealt with a dealer outside of a show in a while, but can say that the one locally that I go to every now and again marks coins up 30% from what he paid provided that cost is in line with the current greysheet ask. If he knows you, he genereally go's greysheet bid or a little under.
Well he probably got it for less than the auction realized price. You just never know. I do know that the dealer I use locally buys off the grey sheet. Then for some of the older coins they do sell after attributing the coin. I have never really worried about the mark up, I just do my best to see if the coin is worth the asking prices. I think some are and some aren't. Then depending who waits on me on the discount I get. When I look at some of their coins I think I could buy them, put them on Ebay and still make some money.
I actually have no idea, I have bought a few coins from CRO who normally has pretty high prices but because of the PQ nature of their coins they also pay much more than any sheet says so I figure I am in the 10% range. I just bought an IHC from Charmy and I doubt she made that much on it.
Not a fair question as the last coin I purchased was a G/VG 1921-D Walker and I bought it for $230, only $10 over what the dealer paid for it only hours before. The rub is that I work for this dealer part-time and he gave me this price as like a "bonus" because he doesn't tend to pay me very much.
hobo, the dealer that I work for doesn't price his coins according to any % mark-up. He sells the coin for a fair price for what it is regardless of what he has in it. He rarely overpays though so he makes money on nearly everything. When he has had a coin for too long, it is generally because he overestimated demand for it. He now prices the coin where it will sell, or as he says "make it go away" so that he doesn't carry any inventory over long periods of time. My point as I rambled on was that he prices the coins at their value regardless of what he paid for them, therefore there is no standard mark-up with him. I think it illustrates your point with a real-life example.
At a show this past weekend I purchased 18 Walking Liberty Halves and 2 Franklin Halves in VG-F condition for $100; at that price I don't care what he paid. I also purchased a 1927-D Peace Dollar in EF condition from another dealer for $20; again what he paid doesn't concern me. Additionally, your single purchase may or may not reflect what he charges on other items.
The dealer's name is Mike & his company is something like "eye appealing investments" or something like that. He sells in the USA Northeast and we frequently see each other walking the floor at the major shows. He specializes in beautiful proof cameos along with some errors & varieties. I bought this 1961 DDR 50C VP-001 from Mike in 2008. I can look for his business card at home & send you a PM if you like. Very best regards, collect89
