becoming a coin dealer

I've dealt with a lot of coin dealers, and they're all over the map with experience, integrity, and customer service. I don't know how many times I've said to myself, "Geez, I could do a better job than that."

Of course, I only continue to deal with the ones who have integrity and good customer service.

So it got me to thinking, I wonder if I could try my hand at being a coin dealer. I don't have the capital of many of the large dealers, but I could open up a table at a local coin show, for example. There's some coin shops in the Sacramento area that I like, and I've thought of asking some of them if I could help out.

So I was wondering if anyone else here wants to be a coin dealer or has already started a small coin business. I'd like to hear some of your advice and experiences.

Thanks.

Steve

 

Log in or Sign up to hide this ad.

Some have, but not me. AJ and the Penny Lady - I do not believe it is as easy as you make it sound. I do think in most cases anyone can setup(or rent a spot) a table at a coin show and go at it. Not me - I like collecting and could not part with the good stuff. My local dealer says he can't afford to collect since this is how he makes his living. He said if he collected a lot of the really rare coins would be kept and he can't afford that. I would get to know the local dealers and maybe they will let you help at some point. I personally think I could buy coins from my dealer and sell them on ebay for a profit. I just do not think that would work at a coin show. Just my opinion.

 

This topic has been discussed here several times. You should do a search of CoinTalk for something like "become dealer" and read those threads.

 

Yeah, its been discussed many times. And I think it is something most of us have thought of, because what better job could someone who loves coins find than working with coins every day. However, it is much easier said than done. And you mentioned not having much capitol yourself. I think that is a major factor. This is a definitely a case of you have to have money to make money. And you'll have to do very well not to lose money.

 

Can anyone suggest or link to a previous thread? I've tried seaching hobo's "become dealer" key words and a few other variations of that but came up empty handed. If you know a thread or link exists, please locate and post the link, really expedites things. Thanks.

 

Well I never considered becoming a coin dealer, but I guess it would be an option if I ever decide to leave the casino industry (voluntarily or involuntarily). On a related note, my boss asked me today why I don't play poker professionally. My response was that I wouldn't enjoy it if it was my job. I really hope she wasn't dropping a hint.

 

You don't have to be a recognized "dealer" to sell coins.

Have you sold any of your stash ? Try it. See what you think. It's very, very important to sell coins, even if you have no intention of being a dealer. Only by selling do you learn if your buying skills are any good !

 

Hint:
Buy low, sell high.

[that ought to start a bunch of responses.]

 

True, it's good to know both sides of the coin... know what it's like to buy and sell. I also suggest this for eBay, all should try being a Seller and a Buyer. If that was a eBay policy requirement, I bet there would be a different sense about buyer vs. seller issues on that venue. :rolling:

 

You bein' an insta-gator?! :mouth: :mouth: LOL!

 

At one coin show I go to I started talking to one dealer where him and his wife worked a table together. Did a lot of talking since both are Cancer survivors. They are rather on the smaller side of dealers but are at that same show all the time. Most of thier items are Proofs and/or Uncirc's in 2x2's and they do fantastic buisness at these shows. And they found you don't have to be rich to start. What they do is order large amounts of Proof sets from the Mint, break them open, place each coin in a 2x2. As for the Uncirc's, they know someone in a bank that gets them rolls of new coins and those also go into 2x2's as Uncirc's. They have a small amount of other coins that is slowly growing but thier main selling is those proof and uncirc coins. Now think of it. They get the Uncirc's for face, throw in the cost of the 2x2 and now sell each one for a profit.

 

Maybe start with Ebay?

 

Since I have not been on this forum very long, I haven't seen the other posts on this question, so I don't know if my advice is redundant. However, here is how I got my start, and perhaps you will pick up something new.

I got my start at dealing in coins by helping out my mentor dealer at some shows when he would come to Southern California, so he could show me the ropes so to speak. I learned all the coin lingo, watched him wheel and deal, buy and sell over the table, how he kept track of his inventory, sales tax issues, what kind of people to watch out for, how to treat/not treat customers (he could be cranky at times!), what reference materials I should have, what "equipment" I should buy, not to mention he taught me how to grade properly, how to see hairlines, determine cleaned coins, etc. He always introduced me to other dealers and told me what they specialized in, whether they were honest, etc. I have to say I learned so much from this man, and he was incredible to take me under his wing. We are still good friends to this day.

When I was ready to do it on my own, I then hooked up with a more local dealer who let me rent space at his table, which I really preferred since he was there to help me if I had any questions. Eventually, I went out of my own completely, and really and truly enjoy being a coin dealer.

The hardest part to me, besides having enough money to create a decent inventory, was learning how to buy from other dealers, and even collectors who came in the door, particularly collections or sets. You need to learn to buy "right" in order to make enough of a profit to stay in business.

The most important thing to me, however, is your integrity. To me, integrity and honesty are the key to making a go of any business, but especially the coin business. You won't retain your customers, and they won't refer others to you, if you don't treat them right. There will always be issues or problems that come up, especially if a customer isn't happy with their purchase, so how you treat them will determine whether they will keep giving you business. I have found that each case is different so you can't necessarily have a set in stone policy, you need to adjust how you handle problems depending on the circumstances.

Let me add, that some of the most difficult situations I've encountered have been with other dealers. Most of them are good people, but there are a few who are arrogant, condescending, think they know everything and you know nothing, and will simply try to rip you off if you're not careful. Don't be intimated by anyone, even the most highly thought of, high end dealers - they are just a business person like you, and you deserve the same respect as the guy who has been doing this for 50 years.

I wrote an article for the Fly-In Club newsletter several years ago on how I got into this business and it is posted on my website if you care to read more (www.thepennylady.com).

Good luck, and don't be afraid to jump in! I am continually learning something new and get a great deal of enjoyment being a dealer. I'm sure you will too!

 

When you decide to become a "DEALER" rather than a collector who buys and sells coins, your TAX ramifications change substantially. It is an area that you need to consider heavily.

 

Keep in mind - once you make what you do for fun your job - then what you do for fun becomes work.

 

generally that's so, but you could divide the aspects of your hobby from what you sell, say collect a specific coin(s) or note(s) and sell everything else so the two don't cross over. it's an attempt at some balance within what you do for fun and for business.

 

The Penny Lady

Great advice and a neat history too. Thanks for sharing this.

 

Sure it becomes "work" but if you love what you're doing, then even work can be fun - and it's definitely that way for me. I was a paralegal working for lawyers for over 35 years, but when I began dealing in coins at first part-time for several years, while still holding down my paralegal job, dealing in coins became much more enjoyable than my paralegal work.

And when I began doing this full-time, I couldn't believe the difference in my attitude, stress level, and just plain happiness. I am now doing what I really love, and am able to make money at it too. Who could ask for more.

Oh, by the way, I still am a collector as well. Sometimes it is hard determining whether to keep or part with a nice coin, but if it fits in my set, it goes there first. And if it improves on a coin I already have, then I simply put the other coin in my inventory for sale. I am lucky as a dealer that I have the opportunity to see many many coins come across my table, so I get more opportunity than most collectors to "cherry pick" the ones that I will keep for my own set. So being a dealer has this huge advantage/fringe benefit for me as a collector as well!

 

Good question, many answers, many thoughts!

I think most "coin dealers" end up there by default. By that I mean they were either collectors or accumulators and drifted to selling their material because there was profit to be made or excess to be sold. That or their interest grew to the point that became the next logical step.

I got into selling coins because I got hooked on doubled dies and the first one I found was a quarter from change worth $1200. Made Coin World twice and was introduced to some of the top die variety specialist such as Wexler, Crawford and Potter.

Now making a living off that kind of success, or luck is not at all realistic. But you can, and I do make "some" money selling coins but I also loose some money selling coins. Yes sometimes we loose. Anyone that does not tell you this is not being totally honest as making mistakes an taking looses is part of life.

Now if you think the above is "hard to swallow" info get ready for this: It takes most folks a minimum of 5 years to learn enough to carry on a simple conversation with a seasoned coin dealer. That is if they buy all the books, read them, get Coin World and Numis News, read them, study, study, study and look at 10's of thousands of coins.

It's then takes another 5 years to hone their skills and network enough to make contacts and start getting confertable in doing limited buying and selling.

Now I run the longest running coin show in the nation each month and know many dealers. The most successful dealer I know both works very hard and had some great luck and is always consistent. He buys at 10 to 15 % back of GreySheet and sells at ask depending on material of course. He spends up to 80 hours a week at it and does many shows each month. He caters to his clientele and generally buys whatever is presented to him and pays better than others. He attempts to always make at least 10% across the board and of course sometimes makes more. For his first 15 years he put every dime back into buying and then got the chance of a lifetime with a gem set of Buffalo Nickles and precisely the right time.

Many dealers always say "you make your money buying not selling coins".

One things for sure there are three things you must know backwards and forwards even in your sleep to be a successful coin dealer.
1. You have to know every series from 1792 to date pretty darn good.
2. You need to know the key dates of same.
3. You need to know the current market values both retail and wholesale for same.

But go set up at a show and have fun. In 10 or 20 years you may have a full page ad in Coin World, it's (as always) "up to you"!!!

 

What?

Coin dealers should know how to spell both 'nickel' and 'lose.'

Giving computer lessons to a dealer took me inside the 'game' for a time, and I learned about buying and selling coins and bags of coins. I even got to see a hoard of UNC Morgans, still in bags. They were in a basement full of them. I asked the owner ever sold any, and he said, "Yes, just two bags. One paid for a house for my son, the other for my daughter."

I believe he will be 'well-to-do' for a long time. LOL

I'm still waiting for that mint-sewn bag of Flying Eagle cents, which remains my dream.