I'm thinking about, when I go to coin shows, putting out a set buy/sell spread on "junk silver" (90% dimes, quarters, halves, and silver dollars) for my first time ever. What I'm considering doing is buying it at 82% of spot, which likely beats what other dealers pay by a small margin, and selling for 94-95% of spot for small amounts and 92% for $10 face or more. It likely sounds as a ripoff to the average at first, but considering how much money has to go into silver, I consider it at least somewhat fair. What would you do in the given situation?
What does it cost to get a table at the shows you attend? I'm thinking it's on the order of $100 per table for the smaller shows here, but the big annual show starts around $300. At that price, you'd need to turn over almost $3000 worth just to break even. I know a couple of dealers at our shows will squeeze their margins down to a few percent for gold, but I think they'll always be a good bit higher for silver. I don't remember the buy and sell prices for any dealers at the last show (mid-June), but most of them were basically saying "you don't want to sell silver to me right now". In the past, I've generally figured local dealers were being fair if they offered a couple of percent below the big online dealers' buy prices and sold for a few percent above those same dealers' offer prices. The local dealers don't get the benefits of scale, but I get the benefits of immediate cash or immediate metal. Under those circumstances, I'd rather sell locally.
The actual percentage isn't nearly as important as the spread. I as the seller would hope for a bit higher percentage. I as the buyer would expect to pay spot, but be happy with a few percent back. Realistically, if you can sell everything you buy on the same day, or within a couple percentages of spot in the next few days, you'll do fine. Beware though - sometimes people are buying, and sometimes they're selling and you might get stuck with it.
You need to figure the costs you incur to figure out what prices are to cover those expenses so you make money.
