Log in or Sign up
Coin Talk
Home
Forums
>
Coin Forums
>
Ancient Coins
>
Estimates for Ancient Coin Auctions
>
Reply to Thread
Message:
<p>[QUOTE="MSG 78, post: 4516478, member: 112660"]As promised, I am opening a new thread to get your thoughts on auction estimates. At CNG we have always tried to estimate coins at what we think is "high wholesale". Over time this is a moving target as the market changes but generally that is what we try to do. The limiting factor on lower valued coins is there are some standard starting points that work with the bid increment system. For example: You will see estimates from CNG starting with: $75; 100; 150; 200; 300; 500... etc. If we think a coin has a wholesale value of $240 it will likely get a $200 estimate placed on it.</p><p><br /></p><p>All lots open at 60% of estimate. Theoretically, this means if you buy a coin at the opening bid you got a real bargain. If you buy at estimate, it is generally still cheap. Then the question becomes "what is the mark up to figure retail?" On low priced coins this might be 100%. This because the cost for a dealer to buy a coin, reticket it, photograph it, potentially post in on their coin shop website, and then package and ship it, is somewhat fixed. I am sure this cost varies by dealer but figure a 50% mark up on lower value coins just to break even on something they may need to hold on to for a while before it sells. Let's call that cost about $30 on low end coins. Thus a coin estimated at $75 or 100 might have a retail value from $100 to maybe $150 if the dealer works on small margins, The price would be higher if they worked on higher margins. The point being, a $75 estimate coin that hammers at near twice the estimate is not all that far from what many would consider a retail price.</p><p><br /></p><p>As the price goes up, the difference between wholesale and retail generally goes down. Fixed costs don't change a lot. So a coin with an estimate of $1,000 might realistically have a retail value between $1,200 and $1,500 depending on how the dealer figures their mark up.</p><p><br /></p><p>So the point is this: We think using a wholesale estimate encourages bidding and "gets the ball rolling". Many European dealers estimate at retail. Some may open bidding at 80% of estimate, others open at 60% of estimate. Some even estimate a retail and this is the opening bid. Experienced collectors have little trouble navigating these different approaches because they know in their mind what a coin is worth before they bid. It's the novices that can get confused. Bidding in a CNG auction, and then switching over to a foreign auction, the opening bid price can mean two completely different things.</p><p><br /></p><p>As I stated earlier, our goal has always been to encourage bidding and get the ball rolling. And if you hit on a coin near the opening (and yes it does happen) you have gotten a true bargain. We have people troll our auctions as soon as they go live and place over 100 bids. All of them are below estimate. The goal: getting the coin that slips through the cracks. They wouldn't do this if they didn't occasionally win a coin or two.</p><p><br /></p><p>So to close, we have talked often about where our estimates should be. Would you rather we keep doing what we are doing or would you rather we raise the estimate up to what we think is retail for every coin? The latter implying that coins will now open at a midlevel wholesale price rather than a very low wholesale price. I would love to get your input.</p><p><br /></p><p>Mike Gasvoda, Managing Director CNG LLC[/QUOTE]</p><p><br /></p>
[QUOTE="MSG 78, post: 4516478, member: 112660"]As promised, I am opening a new thread to get your thoughts on auction estimates. At CNG we have always tried to estimate coins at what we think is "high wholesale". Over time this is a moving target as the market changes but generally that is what we try to do. The limiting factor on lower valued coins is there are some standard starting points that work with the bid increment system. For example: You will see estimates from CNG starting with: $75; 100; 150; 200; 300; 500... etc. If we think a coin has a wholesale value of $240 it will likely get a $200 estimate placed on it. All lots open at 60% of estimate. Theoretically, this means if you buy a coin at the opening bid you got a real bargain. If you buy at estimate, it is generally still cheap. Then the question becomes "what is the mark up to figure retail?" On low priced coins this might be 100%. This because the cost for a dealer to buy a coin, reticket it, photograph it, potentially post in on their coin shop website, and then package and ship it, is somewhat fixed. I am sure this cost varies by dealer but figure a 50% mark up on lower value coins just to break even on something they may need to hold on to for a while before it sells. Let's call that cost about $30 on low end coins. Thus a coin estimated at $75 or 100 might have a retail value from $100 to maybe $150 if the dealer works on small margins, The price would be higher if they worked on higher margins. The point being, a $75 estimate coin that hammers at near twice the estimate is not all that far from what many would consider a retail price. As the price goes up, the difference between wholesale and retail generally goes down. Fixed costs don't change a lot. So a coin with an estimate of $1,000 might realistically have a retail value between $1,200 and $1,500 depending on how the dealer figures their mark up. So the point is this: We think using a wholesale estimate encourages bidding and "gets the ball rolling". Many European dealers estimate at retail. Some may open bidding at 80% of estimate, others open at 60% of estimate. Some even estimate a retail and this is the opening bid. Experienced collectors have little trouble navigating these different approaches because they know in their mind what a coin is worth before they bid. It's the novices that can get confused. Bidding in a CNG auction, and then switching over to a foreign auction, the opening bid price can mean two completely different things. As I stated earlier, our goal has always been to encourage bidding and get the ball rolling. And if you hit on a coin near the opening (and yes it does happen) you have gotten a true bargain. We have people troll our auctions as soon as they go live and place over 100 bids. All of them are below estimate. The goal: getting the coin that slips through the cracks. They wouldn't do this if they didn't occasionally win a coin or two. So to close, we have talked often about where our estimates should be. Would you rather we keep doing what we are doing or would you rather we raise the estimate up to what we think is retail for every coin? The latter implying that coins will now open at a midlevel wholesale price rather than a very low wholesale price. I would love to get your input. Mike Gasvoda, Managing Director CNG LLC[/QUOTE]
Your name or email address:
Do you already have an account?
No, create an account now.
Yes, my password is:
Forgot your password?
Stay logged in
Coin Talk
Home
Forums
>
Coin Forums
>
Ancient Coins
>
Estimates for Ancient Coin Auctions
>
Home
Home
Quick Links
Search Forums
Recent Activity
Recent Posts
Forums
Forums
Quick Links
Search Forums
Recent Posts
Competitions
Competitions
Quick Links
Competition Index
Rules, Terms & Conditions
Gallery
Gallery
Quick Links
Search Media
New Media
Showcase
Showcase
Quick Links
Search Items
Most Active Members
New Items
Directory
Directory
Quick Links
Directory Home
New Listings
Members
Members
Quick Links
Notable Members
Current Visitors
Recent Activity
New Profile Posts
Sponsors
Menu
Search
Search titles only
Posted by Member:
Separate names with a comma.
Newer Than:
Search this thread only
Search this forum only
Display results as threads
Useful Searches
Recent Posts
More...