Any Words of Wisdom for a Potential new Dealer?

Discussion in 'Coin Chat' started by Devyn5150, Jul 10, 2020.

?

To Deal or Not to Deal that is the question.

  1. Heck Yeah.

    33.3%
  2. Hell no.

    66.7%
  1. juris klavins

    juris klavins Well-Known Member

    You need to have a seller history on eBay before you can start a store - take advantage of the free listings offer and try selling a dozen or more small, inexpensive items & wait for the positive feedbacks to accumulate - once you have a positive feedback history and get your eBay sales, payment and shipping routine set up, you can expand to store level.
    Keep good records, note what sells well and adjust your offerings accordingly.
    Read the eBay rules and regulations, ask questions in the sellers' forum, etc.
    Good luck with your new enterprise :)
     
    Last edited: Jul 10, 2020
    rosethe and Devyn5150 like this.
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  3. GoldBug999

    GoldBug999 Well-Known Member

    As a CPA with over 30 years of experience working with small businesses, I think the number one thing that any business needs to do is make detailed projections of all income and expenses for at least 3 years, and preferably more.

    The second thing you need to do is set up an excellent bookkeeping and accounting system.

    As a coin dealer, you will need to have an inventory system that allows you to track the cost of everything you buy, and determine the amount of gross profit you have on each sale. Gross profit is the profit made from sales of your inventory, and net profit is determined after subtracting all your expenses from your gross profit.

    You can expect of have expenses like rent (if you are brick and mortar), shipping, business insurance, office supplies, coin supplies, displays and travel if you will attend shows, a good safe for high value coins, advertising, web presence, telephone, etc.

    Depending on what you sell and where you sell it, you may have to collect sales taxes, file sales tax returns and pay the sales tax to the relevant States monthly, quarterly, or annually. That can take a significant amount of time, and should be factored in to how much you will make per hour.

    When estimating how much you will make on your sales, and what expenses you will incur, err on the side of low sales and high expenses. I have had several clients that would have saved a lot of money if they had seriously analyzed their income and expenses before they started their business. They may have realized that they would end up losing money, or perhaps make about $5.00 per hour (or other small amount) for all their time and trouble.

    Dip your toes into the water before jumping in!
     
  4. Devyn5150

    Devyn5150 Well-Known Member

    Thank You. Yeah I went through the entire process of reading everything, registering and creating listings but, yeah, can't be verified is the error message. Funny thing is, eBay wants feedback on the "help" i've received... lol, they haven't done zippity dodah, so, waiting a little longer before I leave any comments. Thanks again.
     
  5. Devyn5150

    Devyn5150 Well-Known Member

    Awesome tips, thank you!

    Yup, I already have a projected profit spreadsheet which is changed and updated with the things i have been learning and as inventory comes in. My purchase history collecting and inventory is already set up.

    If I hadn't been in the online business course for the past number of months, I probably wouldn't be asking for advice. I've done much research and studying but, sometimes you just need to ask the advice of those have done this for awhile... things I might not have thought about.

    I've got my Canada Post Business account, PayPal Business account, CRA BRO number etcetera...

    Thanks again.
     
    lordmarcovan likes this.
  6. Devyn5150

    Devyn5150 Well-Known Member

    I guess it would depend on one's perspective. A black cat crossing my intended path can be seen as an omen. Having coffee spill on your tie, stepping on a crack, etcetera etcetera. Should I not act because, well, maybe it won't work?
     
  7. Devyn5150

    Devyn5150 Well-Known Member

    Well, I guess I just won't look then, forget it, right?

    MS70... Obviously... What I was trying to discern from the original comment was what they meant which didn't make any sense to me.
     
  8. Lehigh96

    Lehigh96 Toning Enthusiast

    My experience on E-Bay is that my monthly sell rate fluctuates between 5-10% of my total inventory. So let’s say my inventory is valued at $20K, that means my sales are $1K-$2K per month. My profit margin ranges from 3-5% meaning I can expect to earn anywhere from $30-$100 per month. E-Bay & Paypal on the other hand get near 10% of my sales.

    The basic E-Bay store subscription with a monthly renewal is $28 per month but your FVF drop from 10% down to 6%. In order to break even to cover the additional cost of the store, you need to sell a minimum of $700 each and every month.

    In the end, you need either a massive inventory or a high profit margin to make a living selling coins online. If you had the money for a huge inventory, there are many other businesses with higher inventory ratios that could make you more money. In order to generate a high profit margin, you need a source where you can obtain coins at extremely cheap prices. I have neither, and consider the money I make a hobby bonus, and the real reward is that I get temporary ownership of some really nice coins
     
  9. Devyn5150

    Devyn5150 Well-Known Member

    Covid... Bitcoin... etcetera yeah, who knows but I ain't gonna know anything if my feet ain't moving.

    My business quote...

    "it is better to do fair business than to get rich quick once"

    One thing I won't be doing... charging $10 for a 50 cent coin worth 50 cents and adding $30 shipping.

    Radio killed the video star but shipping kills coin collecting.
     
  10. Devyn5150

    Devyn5150 Well-Known Member

    This is the type of information I was hoping for, actual experience with facts and figures, thank you!
     
    lordmarcovan likes this.
  11. Devyn5150

    Devyn5150 Well-Known Member

    Any business venture is a risk and the reference to brick and mortar has escaped me.

    If I had a passion for drugs, maybe i'd be selling them. If I had a passion for catching mice to sell to python owners i would be doing that. Gotta go with my passion.
     
  12. longshot

    longshot Enthusiast Supporter

    This. I pretty much quit selling on ebay, the fees eat your profit.
    Not to be a downer, give it a try, but expect to spend a lot of time for small returns.
     
    NSP, ewomack, Devyn5150 and 1 other person like this.
  13. charlie123

    charlie123 Well-Known Member

    I see you're in Canada. You're displaying modern Canadian and American coins. The American 2009's Formative Years have pretty much run their course for price increases. The strongest '09 was the skeleton finger whose price last I looked has gone steadily down. A guy named 'Pitboss' over at CU cornered the market on these. Had tons of the best errors. Maybe shoot him a PM over there for his take.

    Check the Canada reddit- "Collector and numismatic Coins" discussion thread. It focused on moderns. Over 60,000 comments. Couple of years ago there were 25-40 very active posters, I witnessed some posters there open online coin stores. Now there are maybe 5 posters, none have online stores. The dwindling few posts a week are about foreign commemorative coins. No Royal Canadian Mint (RCM) talk, except to knock RCM and say there is no money to made from their releases.

    The once very active Canada reddit coin thread is a deserted wasteland.

    Sorry, not a great idea.
     
    Last edited: Jul 10, 2020
  14. masterswimmer

    masterswimmer A Caretaker, can't take it with me

    Very succinctly put, you'll be an employee of feebay. They'll earn the lions share of any potential profit with you as their investor providing them with your inventory, your warehousing costs, your shipping and your marketing abilities (how you list your product). You will make so little after your expenses you'll wish you could turn back the clock and take the advice of what seems to be the consensus of the 'experts' you're consulting here.

    Whichever way you go, best of luck. Truly!
     
    Charles Riley likes this.
  15. Mike Thorne

    Mike Thorne Well-Known Member

    I had a part-time mail order coin/stamp business for 10 years from the late 70s to the mid 80s. Believe it or not, I made a profit that I paid taxes on every year. My secret, for what it's worth, was to give the absolutely best service imaginable. Virtually ever order I received left my post office within 24 hours. I never held a check pending clearance, although I did occasionally call the bank on which the check was drawn to see if the account was legit and had enough money to cover the check. I only did this for new customers who sent an expensive first order.

    The real secret to making money in mail-order coins was to buy right and to be very, very strict with grading. This was before certification, of course, and before digital photos. I also put my price list inside a newsletter that my long-term customers really liked. The newsletter was about me and my family mostly. Also, my family occasionally visited and spent the night with some of my better customers when we were in their area. I mostly enjoyed the whole experience immensely, but I eventually realized I could make as much or more money writing about coins, and the writing took a whole lot less time.
     
    NSP, philologus_1, -jeffB and 3 others like this.
  16. Devyn5150

    Devyn5150 Well-Known Member

    Yup I realize Americans have little appreciation for Canadian coinage and of course I spelled out my entire business model and my every move is already known. Of course as a Canadian I'm only going to sell Canadian and fail. Thanks. I gather nobody will want any of the other world coin I've got in my inventory built up neither. Awesome> Words of wisdom... don't try, can't fail Canada sucks anyways. lol
     
  17. Devyn5150

    Devyn5150 Well-Known Member

    Thank you.

    I've gotten some good deals on my growing inventory and it has been cheaper to buy from some other countries versus buying from America.

    I have a direction and through my business coach, a decent handle on what is necessary. I wanted to ask all of you much sooner for your expertise but pretty much knew the outcome. I am not surprised in the slightest at the replies.
     
  18. thomas mozzillo

    thomas mozzillo Well-Known Member

    Best wishes to you in starting your new business. I truly hope you are very successful in your venture.
     
    Peter Economakis and Devyn5150 like this.
  19. Devyn5150

    Devyn5150 Well-Known Member

    Thank you for the best of luck wishes. I was hoping folks would be kind enough to highlight some of the possible pitfalls, maybe save someone some headache through their experience. I understand it is a risk, everything is and yes, I have heard some dissatisfied sellers on eBay... is success impossible? Is everyone on eBay making nothing? I have heard much from the group on both sides of the fence but, as I recall, no one has offered an alternative to eBay... eBid, Amazon etcetera.

    In hindsight, I probably should have mentioned... I didn't wake up yesterday and decide to be a dealer. I haven't put all my eggs into this one basket... it is something I want to try and I do see a need in this part of the world even if America doesn't... I've been taking an online business course which I am also using the knowledge I've gained for my original music production, I have a passion for collecting and a greater one for music and I said it before... I go with what I am passionate about.
     
  20. Devyn5150

    Devyn5150 Well-Known Member

    Sometimes this is all a person needs... encouragement.
    Thank you, one of the better responses I've received today!
     
  21. thomas mozzillo

    thomas mozzillo Well-Known Member

    If you read Coin Talk's rules, there's a certain time that you will be allowed to sell coins on this site. I think it has something to do with how many times you post here, but I'm not sure.
     
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