Just out of curiosity, has anyone ever deciphered a dealers price "codes" often put on the back of 2x2 holders? These codes are used by dealers to mark each coin with how much they spent on it, allowing them to never lose money on a sale. At the flea market where I occasionally buy coins, I have developed a pretty good business relationship with a dealer. After setting out all of the coins I have purchased from him, it was quite easy to "guestimate" his coding system. I do not exploit this, however it does tell me what his margins are (and give me some extra bargaining room)
Not all such codes represent cost. They can be wholesale codes, minimum asking prices, etc. And even if they are cost codes, it doesn't mean the dealer "never loses money on a sale".
I know the codes to two of the pawnshops I stop at to look over stuff now and then, it can help when discussing a price on my side as I know where his "limits" are. Of course they both know I know their codes so I never go for the throat, they all gotta eat too.
Those codes are usually constructed by devising an easy-to-remember 10 word phrase with each word having a different initial letter. That serves as a mnemonic device to assist in remembering the code. For example "Every Day I Get More Confused About What's Happening Now" would give a code of E=0 D=1 I=2 G=3 M=4 C=5 A=6 W=7 H=8 N=9. In that code $175 would be DWC. As Marc Feld pointed out, the coded amount might be cost, minimum price, or something else.
Most codes are simple enough that with enough examples you can figure out their codes, but other than doing a couple for fun I never saw any point in doing so. I know what the coin is worth to me and I don't really care what he paid for it or how much he is making. If you are making your own code and you want to make it a little more difficult to figure out, you can have multiple letters than mean the same number, or you can include letters that have no meaning at all that you just ignore when you are reading the code. You can also combine the two techniques or even include special characters.
Believe me, some dealers know their codes get cracked and use them to represent something other than their actual cost.
I don't use cost codes. My inventory is always on the small size, I usually know what my cost is without looking it up and I have a print out, in case I need help.
I use codes for cost, retail, grade, and sometimes even one for price guide source. One can be creative and mix up the codes. For instance the name of a city could be your base code and underlined numbers or letters could mean something else. A certain letter can mean 00 and other letters can be dummy letters to confuse the curious sort. Once you use the code long enough its easy to understand sort of like becoming fluent in a foreign language. I don't worry about figuring out some guys code or how much money he's making or not, I just look at the coin carefully (grade) and see if its pirced in a range which will work for me.
That's pretty much my attitude. I did learn that you never use the same dealer for both your buying and selling. I made some money on gold, but the dealer thought I was getting in his pocket. That was not my intent, but the price fluctuation that was good to me hit him harder than I realized. What a dealer paid for a coin in 2006 may not be relevant in 2010. We all want to make a profit but not at making someone else lose. gary
