Question for all the veteran dealers!!!

Hi everybody...as you can see I am new to the forum and to coins as well. I have recently (within the last 3 months) come into a large (very very large) sum of money. My friend (who's got his own money) and I have been considering a coin dealership. We have been looking into it for a couple of weeks (I just bought my first couple of coins this weekend.) and we are having trouble with one area in particular.

The problem we are having is that we want to make sure that we are paying a price for coins and collections that are fair to the current owner but are priced so that we make sure we are making the proper profit. In other words we want to be fair to the people we are buying from.

Is there any guide or publication that will help with this aspect of buying. Thanks again in advance.

 

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Im no veteran nor do I own a shop but I would think it be wise to study up on coins a great deal and to also buy a Red book before jumping into a buisness such as this.

 

Fresh Meat..........:devil:

 

Get a grey sheet bid price. A lot of dealers use it and its basically what you should pay per coin for each grade. As long as you know how to grade, it should work out fine

 

Dealers pay at least 10-20% below CDN bid prices.

It sounds like you don't really know what you're doing (sorry). Becoming a coin dealer is not just something you jump into without a ton of experience and knowledge. If you have enough money and you don't have to work anymore, I suggest befriending a dealer and asking him for help.....maybe even tell him you'll work for free if he is willing to mentor you. Without this experience, you could quickly watch your money evaporate by making huge (and costly) mistakes.

Good Luck!

 

I hope you're not serious. But if you are I'd say it's a terrible idea and you will lose your shirts.

Spend 20 years studying coins and learning the business and then reconsider it.
Lance.

 

I don't advise it without the requisite knowledge. If you can't grade coins, have no idea what would be a fair price to pay or charge, know nothing about spotting problem coins, have no idea what would constitute investment-worthy coins for the growth of the business then you are surely bound to lose a lot of your investment.

Chris

 

How many years experience in coin collecting do you have? If you have less than 10 to 20 years STAY OUT OF THE COIN BUSINESS. It will eat you alive.

 

This may sound mean, but I'm just being honest. If you have to ask is there a price guide for coin buying, you're definitely not ready to open a coin shop. To run a coin shop, you really have to know coins, certainly the CDN (Coin Dealer Newsletter, or greysheet) can help you price coins, but if you can't accurately grade coins, it really isn't much help, especially considering the difference between a single grade can be huge. Then you have to worry about fake coins, fake slabs, altered coins, etc... . Imo, there's just way too many aspects of the coin business a person new to the hobby doesn't know to successfully run a coin shop.

If you're truly interested in opening a coin shop, I recommend doing what BadThad said, really get to know the business before diving in.

 

Like others have said, you dont just "buy" your way in, and then become successful. I know my dealer(s) for the most part started their business after a good 15 years of collecting, at the ages of 35+. There is sooooo (stress "so") many things necessary to know to be a successful coin-dealer. You have to be able to grade coins, detect counterfeits, know just about everything there is to know!!

But that beng said, if you still want to be a dealer I'd suggest you start to actively collect coins, study them, and then after you know everything possible there is to know.... then begin to consider the idea. The difference between success and failure is knowledge and experience.

BTW, I far from an experienced dealer....

 

One thing no one has asked. Does your friend really really know coins? (I'm considering the possibility that the friend is the brains and the OP is the bankroll.) But if you are asking us and not your friend I kind of assume he probably isn't ready either.

We really are trying to be helpful. We don't want to see you end up like the old joke How do you become a coin dealer with a million dollar inventory? Start with two million dollars.

 

I wish you the best of luck , but it takes alot of knowledge personal time, besides the money. I had a website store for almost 7 months
and I did not nearly have the responsibility as both of you had . I'm still a newbie my self, there is alot of knowledge on this site, I myself
had to set back and think of reply's I received on questions . We are all to help each other , please take evereyone's comments under consideration.
Again wishing you the best whatever you decide.
Sandy

 

If youse guys gotta ask, better get another investment scheme. You're doomed to failure. Coin investing/dealing is not to be taken in the trivial sense. That is to say that nobody walkin' off the street is going to prosper from it. It takes years of study. You don't pick up the knowlege in a weekend or on a social networking site.

 

Check out this thread. There's some good advice.

http://www.cointalk.com/t172427/

I particularly like post #3.

 

DOUBLE POST -I wish you the best of luck , but it takes alot of knowledge personal time, besides the money. I had a website store for almost 7 months
and I did not nearly have the responsibility as both of you will have INS. bonded etc. . I'm still a newbie myself there is alot of knowledge on this site, I myself
had to set back and think of reply's I received on questions . We are all to help each other , please take evereyone's comments under consideration.
Again wishing you the best whatever you decide.
Sandy

 

Most young folk will go ahead & say "whatever, old man" the try to prove us all wrong. So assuming this to be true, here is my advice.
Open up a cash for gold place. Shop around & see what they're paying. Try to keep your bid around 70% of spot(most pay much less). Instead of working with a refiner who may give you 85%, sell everything for spot in your shop or online. It won't be easy, but you should see enough nice pieces come in to start your "hands on" education. Keep the refiner on standby because you'll get plenty of scrap too. Don't take any plated or electronic scrap. You'll need various test kits(acid), scales(good ones), & a great location.
Good luck!:smile

 

LOL...I guess I should have been more specific with our intentions. We are in the process of working a business plan. My friend and I are both we'll educated and experienced in business so we are approaching this in a tried and true method. Our expectations are to have a virtual store shortly before the holiday season 2012 and a B&M store within one year of that.

We recognize and acknowledge that we are taking a risk but neither of us are averse to risk. We are in the knowledge and experience gathering stage of our development at this time (which is why I posted the question in this post. We are already scheduled for several coin shows and events in the near future.

As for those who are sure we are doomed to failure I can only say that that is an incredible assumption given that you know nothing about our situation such as our intelligence, ingenuity, determination, capital position or anything else.

A side note for Green18...How is asking a question dooming anyone to failure? The first step of any endeavor is the acquisition of knowledge and the keystone of the acquisition of knowledge is of course inquiry....odd that I would have to explain that to someone quoting Milton and Churchill.

 

My advice would be that you NEED education. I would offer to work cheaply for a local dealer and learn the ropes. Nothing in the world will prepare you to be a coin dealer than actually BEING a coin dealer and learning from an experienced one. Nothing will teach you to grade better than grading thousands of coins, and nothing will teach you to negotiate better than being around hundreds of negotiations.

I wish you luck WarriorPoet.

Chris

 

Take a trip around the world or spend a month in Europe or London. Probably you will be happier at the end of that time and STILL have money to live on. Never start a business about which you know nothing!

 

I'm not at all a dealer, but I will give you a few pieces of advice. Unless you can employ a team of experts who are extremely knowledgeable about coins, and are willing to put the time in to learn yourself very soon, this is a bad idea. It's not just about what's a fair price for buying and selling, it's also about being able to spot fakes. There are A LOT of really really good fakes of higher value coins floating around right now. Unless you can identify them, you're going to get yourselves in trouble. And I don't just mean losing money or your business, we're talking a felony here.

Honestly I'd advise you to sit on the idea, become an expert in coin collecting, and then consider opening a business. I'm not trying to ney say on your dream, I just don't want to see you get yourselves in trouble is all.