Is it common for dealers to buy from auctions and sell on the bay?

If one does their due diligence they can find coins on Ebay at reasonable prices. Personally, I'll only buy auction coins on Ebay since buy now prices are almost always significantly higher than most auction prices. Yes, I've made an offer to a seller and they accepted my offer, but in those instances what I offered was in line with recent auction prices. If I can win a slabbed coin in an Ebay auction at a price that I'd pay at a major online auction then I call it a win for me since I don't have to pay a buyers fee and possibly shipping.

 

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With HA in particular it’s not just the buyer’s fee. The shipping charges are much higher than eBay and GC, as it is my understanding that they treat shipping and handling as a profit center. Paying $20 plus on a $400 purchase amounts to an additional 5 percent. It makes it worth paying a bit more on eBay even if the exact same coin recently sold for less on Heritage. Not to mention that eBay shipping is usually much faster and there is a better return policy.

 

For any coin purchase, it’s the TCA (total cost of acquisition) that counts … hammer, premium, S&H, taxes, etc. … all of it should be considered before making a purchase. Comparing hammer price of traditional auction houses that charge a buyer’s premium to auction prices on eBay is apples to oranges.

If you decide that the maximum you can spend on a coin (i.e. TCA) is $500, first deduct shipping and taxes (if any). Say shipping is $15; so that leaves $485. Say sales tax is 8%, and assume it does not apply to shipping. That leaves 485/1.08 = 449. Say buyer’s premium is 20%, then you should bid no more than 449/1.2 = 374.

When it comes to how what I pay is divided: Frankly. my dear, I don’t give a …. I do the TCA in a spreadsheet, which is easy, then decide.

Cal

 

Sounds like arbitrage to me...

 

Hmm.

If you want a great coin at a "fair" price, you go to a trusted, reputable dealer -- one who knows where to find such a coin, buys it at a lower price, and then sells it to you at enough of a markup to make a profit. I don't think most people would characterize that as "taking advantage", but it's separated by a line that's quite fuzzy, IMHO.

Other things scattered around that line:

1) Cherry-picking from a dealer at a show
2) Cherry-picking from a casual seller
3) Cherry-picking from change you receive

 

Mmmm. I like cherries.

 

Dealers buy coins wherever they can find them. Auctions, shows, private sales and of course on ebay. They also sell coins wherever they can and that includes auctions, shows, private sales and ebay.

It is a business like all others. The total cost of purchase and sale is figured into the deal.

 

I think I get your point, but this still reads like a textbook illustration of "begging the question". If you can sell the coins for $X on eBay, then they ARE worth $X, because you can get that for them on eBay.

What you mean, I assume, is that markets composed entirely of knowledgeable buyers and sellers determine the true worth of a coin, and we should ignore eBay because the buyers there don't know what they're doing. But that begs the definition of "knowledgeable", or else cherry-picking wouldn't exist. It also assumes that everybody in those other markets is rational, and I'm not sure that's a reasonable assumption. (For example, I don't know how it accounts for buyers like "Clio" in the ancients realm -- a person or business with apparently bottomless pockets.)

 

This happens a lot on coins I collect. I'll lose out at lets say heritage or stacks and then in a month down the line, same coin is in a well known dealers stock and being sold on their website or on ebay FOR MUCH MUCH more, very frustrating.

 

The bottom line is that when people buy something it's their money, not yours. If I offer a coin for $500 that more knowledgeable people think is worth $200 then they won't buy it. But don't chastise me for selling it to someone willing to give me $500. Whether that person is "knowledgeable" or not shouldn't be a consideration. There may be multiple reasons why they are willing to spend more for it. I'm sure most of us have "overpaid" for a coin that we otherwise would have passed on if we "knew better". Personally, my conscious won't allow me to take advantage of someone due to their ignorance. But, if I feel I'm being totally up front with someone and they still want to pay me more than what I think the items worth, I can live with that.

 

Kind of funny how so many think something is only worth "x" until they try and sell it and then it's all of a sudden worth "y"

 

Some people are willing to pay more for convenience, or to get something that they like that is immediately available to them. Just think of all the crap we pay huge markups for that we could get cheaper somewhere else. Like a $200 cart full of groceries at a premium grocery store chain that we could have gotten for $150 at a lower priced chain, but the shopping experience is more pleasant at the premium chain. Or a nice new shirt for full price at a department store, even though there are similar shirts of the same quality at TJMaxx or Marshall’s for half the price. Why should coins be any different? If you have an urge to buy a coin, you can find an auction ending on eBay at any hour of the day, versus waiting for a weekly auction on GC or Heritage.

 

...and the circle is complete.

 

This is pretty common.

Sad part of eBay is that almost all coins (and other items) are listed at fixed “buy it now” prices.

I miss the days of eBay when it was mostly $0.99 starting (no hidden reserve) auctions.

 

Most if not likely all have no excuse for lack of knowledge when it comes to Cherry Picking. Dealer for 35 years etc. I'll admit some of my best Cherry Picks came from some that have written books on the subject of Cherry Picking.

Also, those TV folks are whale buyers on Ebay at least for modern releases as when I used to play one of us could spot them buying up everything in sight without any concern for price points and thus we'd oblige by raising the prices to see how high they'd actually go. So be comforted knowing they did at least pay up.