I got an education in selling

I've been considering selling my collection for a while now. Up to this point I've been a pure collector/horder. I've sold a few coins on eBay but mostly for the past 8 or 9 years since I entered the hobby, I've been a collector/accumulator.

So I figured I'd see what I could get for my collection if I took it to a dealer. I called a local dealer and told him that I had a collection, would he like to take a look at it and see what he might offer for it. I brought in a sizeable portion of my collection, ie most of the US sets I've completed or am very close to finishing:

--A set of Morgan Dollars in a Dansco, minus the 93 S, most coins in XF-MS63. 94 slabbed in XF-45
--A complete set of Peace Dollars in AU/BU
--A set of SLQs in VF-XF, minus the 1916, 1923 S slabbed in F12
--A complete set of Indian Head Cents in VG-XF, 1877 slabbed in G6, 1909 S in F12
--A complete set of Lincoln cents G-VF, 1909 s VDB slabbed in VF20, 14 D in VG8
--A complete set of Mercury Dimes VG-VF, 1916D slabbed in G4
--A complete set of Buffalo Nickels VG-VF, 1937 3 legged slabbed in VF25
--A set of Barber Halves in VG-VF, minus the 92O, 96S, 97S
--A complete set of Walking Liberty Halves in VG-AU

I had calculated the Red Book value of these coins at around $38k. I know that's pure fantasy and did not expect to get anything near it. I consider myself a prudent buyer, I haggle quite a bit and try to pay between graysheet ask and bid. I actually have invested around $27-28k in the collection. Well I was a little shocked when his initial ballpark offer came in at $16k, or about 60% of what I paid for the collection. He said if I wanted to really sell, he'd take a closer look at the individual coins and the offer may differ. He didn't say it would increase, but I took it to mean he might come up a bit.

This experience really brought home to me what everybody constantly says on this forum: "As a collector, it's hard to make money in coins." It would be a lot of work and hassle, but I'm sure I could do better than that just by breaking the sets up and selling them individually on eBay, even after I took the 9% seller's fee and 3% pay pal fees out.

What say ye with experience in selling coins? Is this a typical dealer type offer? I understand they need to make a profit to stay in business but 40%? Should I take the coins to a different dealer or should I break up the sets and sell them myself?

 

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Race, you might as well face facts. No matter what dealer you take your collection to, you're going to get around the same offer for it. If you are really intent on selling, you'd be further ahead to sell the collection on your own. If you don't want to pay eBay fees, so you can maximize what you get for the collection, I would suggest your local craigslist as a possible venue. Just be careful and never meet a potential buyer at their home address. Always meet in a public place, where there is likely to be people around.

 

dealers buy with the goal of making a profit in a re-sale. You will therefore get a lot more by eliminating this " middle man" and sell directly to a buyer either via ebay, a local coin club, an auction house, or an interested 3rd party.

 

Sort of depends on where you live. If you live in a large metro area where there is an active CraigsList, I would offer ONE set a time, making it crystal clear that the coins are in a safety deposit box at the bank, that you will ONLY meet at the bank, and that payment must be in CASH, to be deposited immediately, with no refunds or bringbacks, etc. CraigsList gives you almost unlimited text and up to 8 pictures, I think; it is not ideal, but it's free, and a lot of collectors read it. You MUST protect your security, and you MUST ignore the many Chinese and Eastern Europe hackers who will try to get information on the most sincere-looking of pretenses.

CraigsList is a real minefield for the amateur, but it will work if you are patient. And if it doesn't work, you have invested nothing but time. If you are more than 25 miles from a major metro area, it's probably not workable. You should also get a gmail address specifically for this venture, and get rid of it when you're through. I have sold a lot of coins on CraigsList; you can toplist every 48 hours. Just an idea. No one is better qualified to sell your coins than YOU.

 

Welcome to the age-old dilemma that is selling coins.

Collector coins are not an investment, unfortunately. If you have patience, I suggest alternative methods. However, I prefer ebay for its simplicity.

 

I see that BUncirculated and I had about the same idea. One other benefit, you find some first buyer with deep pockets, he may buy more later, making the process even simpler.

 

I would add that there is NOTHING "simple" about eBay (I have 2500+ transactions 1999-2009, when I more or less stopped) and EVERYTHING is stacked against the Seller. Plus the ******** at PayPal will raid your bank account on the slightest pretext. I don't sell anything over $50 on eBay now because they are *****. It used to be fun.

 

Nice cartoon, but I don't get it?

 

The problem is you took too many coins at one time. 40% is not a good offer from a coin dealer. But, what he saw a giant pile of coins he didn't have the time to sort through so he lowballed you. He may have been offering say $8 per common date Morgan. Had you brought that same Morgan in alone, he might have offered $20 because he could process how well it might sell and for how much and you both would have been happy. Unless it's common junk silver or generic bullion that is priced by weight, dealers hate seeing large piles of coins walk into their shops and will set a low price every time.
Guy

 

I commisurate with you Race. I am glad you posted though, to give a first hand account to those who still believe coin collecting is an "investment". This buying at retail selling at wholesale kicks you in the pants.

If you ever wished to sell, you could think about approaching dealers who specialize in certain areas with those sets. Taking all of this to a b&m dealer will be the low ball offer, since he most likely does not have clients for most of these coins, and will in turn wholesale most of these out. If someone went to a large show, and knew which dealers specialize in which series, I think you would do much better, (ie sell the morgan set to a morgan specialist, barber, etc, these specialist dealers have large client bases wishing to buy these series, and as such can give you a better offer).

I still believe coin collecting is a great, great hobby. However, ALWAYS make sure you only spend "hobby" money on it, and not "investment" money. I have said it 1000 times, many dealers try to use PCGS price charts, etc to get collectors to buy coins they cannot afford as a hobby as "investments". Its simply a poor "investment" but a wonderful "hobby".

 

+1

 

+2

I have a question for RaceBannon >
Did you calculate the total Gray Sheet value of these coins? I'd be interested to know how that total compares to the dealer's offer.

 

This should clear up any confusion:

 

I'm sure you probably already knew selling to a dealer would be something along these lines, but I do think this information would be very relevant to someone that inherits a coin collection and doesn't know a thing about selling coins.

 

NEVER NEVER NEVER bulk sell an entire collection--you will be lowballed, as the dealer thinks you are desperate for the money. Take selected items and sell certain groups of them at a time. Example--take the Morgans as a set, and see how much prices vary. I have made profits by judicious buying and holding coins long term. It totally depends on how patient you are. The 40% is an extreme lowball.

 

Dealers don't lowball because they think you are desperate, and the ones that do aren't dealers, they're common crooks. They lowball because they simply don't have the time to take apart a set and price and sell that many coins while trying to run a business. They'll pick out the keys and maybe some of the nicer pieces and put those in their cases and then sell the rest wholesale to other dealers or as bulk junk silver.
Guy

 

Race,

If you are not in a hurry to sell your collection, I suggest that you use E-Bay to liquidate your collection if you have good photography skills. I am doing it right now and am basically breaking even with my purchase prices despite the E-Bay and Paypal fees.

One of the problems that I see with your coins is that you have a huge number of lower graded coins which means an awful lot of work for the dealer to recoup his investment if he buys your collection. He probably knows that it will take him forever to sell that many coins and plans on selling them wholesale to other dealers. As a result, you are essentially being charged the profit margin for two dealers rather than one. I think if you walked into his shop with a box of 20 worth $25K, you would get a much better offer than 40%.

As it stands, you will probably realize much better prices if you sell the coins yourself. As a warning, selling on E-Bay can be a lot of fun, but it is a lot of work and you have to be on top of it everyday. Some days it is very much like a job.

Good luck!

Paul

 

Thanks a lot for everyone's responses. Very good information passed by all. I just want to clarify a few points.

His offer is approximately 60% of what I paid for the lot. The 40% I refer to at the end of the post is the profit he would make if he sold the coins for what I paid.


To answer collect 89's question. No, I don't have a current Gray Sheet, but I should invest in one and calculate the greysheet prices. I'm sure it would come close to what I paid for the coins, which were mostly assembled individually.

Some more info, to save time, he priced the coins as sets. In the greysheet it lists price for complete sets by grade. I noticed he undergraded the sets. Most have coins in varying conditions but he'd invariably use the greysheet price for the lowest quality of coins in the set, ie the Lincolns in Good while many were VG, or the Merc Dimes in VG while many were fine ect.

Bottom line, I think the takeaways are:
1. Don't sell to a dealer if you want to minimize your losses/maximize your profits.
2. Don't sell in bulk if you can avoid it.

3. Coin collecting is a great hobby, a great investment...not so much unless you've got a lot of time and knowledge.


Well, at least I've done OK on bullion. I'll probably sell off some of that in the near future as well, as I think the bull market may be reaching the end of its run. Either way it's been a fun ride and I've enjoyed the process. For me, selling is part of the learning process too.

 

Or I would say Race could try to sell some collections here if he wished. I know there aren't a ton of deeper pocket buyers here, but a few of us at least have more than a couple of nickels to rub together.