Dealing Coins

If you are going to be a coin dealer, where do you find the coins you are going to sell?

 

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anywhere and everywhere.

 

A lot of dealers started out as collectors, and accumulated a fairly large collection (inventory?) before entering into the business of selling.........

 

I'd hate to sell my collection.

 

Me too, but sometimes it's necessary to do so......especially if you're after something that's elusive and lack the disposable funds.

 

I wonder if there is much money in dealing coins.

 

For the savvy guy who knows his market and trends, the sky is the limit. For schmoes like you and I? We'd likely be wearing a barrel.......

 

I was going to put together a 20th century type set and try to sell it on eBay, but I was told that eBay is a rough (to say it mildly) place to do business.

 

I hate to steal someone else's quote about starting to deal coins, but someone said "To make a small fortune selling coins, you first have to start with a large fortune" I'd be a terrible coin salesman since I'd want to keep all the inventory.

 

Just a little vauge.

 

My guess is this is the first thing that will cause you to loose money. A dealer needs to NOT fall in love with his inventory. It is product. You can make money on it or not. I farm for a living and one thing I have learned is that you can't fall in love with that head of lettuce or bag of oranges. You have to move the product. At least with coins they don't "spoil" so you have to throw them away (well they could be damaged or stolen) but it ties up your money in inventory with no guarantee that it will increase in value. Buy smart, move product, if you have a looser, well, lose it and move on. if you have a piece you want in your collection, well that is taking profit out. That's ok, but you aren't making $$

 

Hit up a medium sized (regional) multi-day show. This weekend's TNA show in Arlington, TX as an example.

Friday afternoon at 3pm

Find a couple dealers who are /a/ not busy and /b/ selling the kinds of coins you want to sell - i.e. not the 10K top pop for registry collectors.

Ask them... talk to them about the business. If you can find a local B&M talk to the owner, maybe offer to help him as an unpaid intern for a couple months.

Treat it like any other business - research, research, research before spending that 1st dime.

 

Yep, but it is correct. It takes time and work wherever you look.
Ebay, time to look through all the other dealers trying to sell retail and finding that one worth biding on and trying to not overbid
yard sales - footwork, driving, and searching
estate auctions - time to find the one that has product and try not to overbid
beach combing / metal detecting - time time time
adverting "we buy coins" - cost and time waiting for someone to call, and not over spending
inheritance - yea, well....
pocket change - ask anyone in the coin roll hunting section about how much you make compared to the time it takes.
The US Mint - they do have a volume rate but they you have to sell that.
set up a retail shop - GREAT way to loose a lot of money on rent and payroll, a few make it work but you have to move a LOT of product to pay the bills and you have to wait for people to bring you product and... yes... not overspend
coin shows - you and a thousand other people trying to buy low and sell high. A few make it work
Buying large lots, but then trying to move all that product and make a profit
I'm sure there are other ways, but all take time. and don't forget the old adage, "you make your money when you buy."
and don't forget to keep REALLY accurate records for tax time, just in case you do make money.

 

I've been told coin shows are a retail event. Can you buy coins there and sell them for a profit?

 

First if you want to be in any business become an expert in it. Work for a coin shop and read a lot visit many shows.

Second you may need to really understand the net / net margins - they are low after all is said and done if your talking brick and mortar. I would guess 5 or 10 % net/net profit. net profit after all is said and done.
(Taxes , insurance , rent or mortgage , cost of goods , advertising etc , etc , etc.)

Imagine selling 400 k of merchandise in a year and after its all said and done walking away with 30 k in real net landed profit. The coin you just paid 500 bucks for you sell a year later for 650.00 and paid cost of the credit line , cost of storage and insurance on the coin and the overhead. 30% margin for retail coins is close to normal. bullion far lower in the single digits. Consider 60 or more work hours a week to land that net profit. Book keeping , taxes , research , etc all take a lot of time.

I would suggest sell as a online dealer and specialize in an area you have a lot of knowledge. Become known as a fair buyer and high standards as a seller. You wont be the lowest price as a dealer and wont be the guy for a bargain every-time but could develop into a dealer that offers quality in the area you specialize in.

Sell on eBay and shows and the buy and sell forums here and another popular forum. Coin and gun shows offer exposure to a diverse group of collectors.
Buy select coins from other dealers become known as a guy who buys fair and pays fast it will go a long way for any dealer working to become established.

buy the very best for grade coins at shows and sell them for a small mark up too get some traction and work on reputation and quality in your sales.

Burton offered the very best advice and I can only echo that suggestion , find a dealer and learn from that dealer offer to work as a intern of sorts in return.

 

Yes you can find good buys at shows. It all takes Time... if you take the time and find the deals. But that's the point, ebay, shows, and most sources are trying to sell retail. You will have to sell retail to people who are wanting to buy low.

 

I don't think the saying belongs to any one person. I've heard a couple versions like, "If you want to make one million bucks selling coins, you have to start with two million bucks."

Chris

 

I watched one of the best in the business on Friday. She's known in the industry for having an amazing eye and not overpaying. So having her show up at your booth, going through your stuff and wanting to buy some of your inventory is validation for the dealer. Ego boost time...

Then she tells you what it's worth and what she will pay for it. When she told him "I can't help it if you overpaid" I thought he was going to cry...

But as a retail buyer, I know their stuff is good quality and fairly priced. And now I've seen the sausage being made.!

 

No matter the product you must first learn it inside and out. You have to know all the answers before the questions are even asked. Assuming that you have a general knowledge of coins just pick a series that you are most familiar with. The one that you love inside and out. If you don't already know details, then learn. Learn the price points at every grade level. Learn this from the 'GraySheeet'. Know that you must pick a popular series. Doesn't matter how cheaply you buy if your merchandise doesn't sell. Learn to spot varieties. This will make you a lot more money. And for goodness sakes... LEARN TO GRADE CORRECTLY!