Taking Apart Mint/Proof sets

I want to start off by saying I would never do this with old sets, but I noticed that with the bicentennial silver proof set, the individual coins sell for more than the combined proof set. Have you guys ever heard of people taking apart proof sets and selling them piece by piece? And do you guys think its a bad thing to do?

 

Log in or Sign up to hide this ad.

It's a very common practice how do you think people get graded proof coins or coins for album sets?

 

Magic?

 

I don't, especially in cases where one or some of the coins are superior to the others.

 

I would only take them out if I were to sell them now, otherwise I'd leave them encased, they can be taken out anytime, but if you take them out and in a few yrs a set is worth more than the single coins youd be hitting yourself

 

It's kind of like GSA Dollars huh? They are now worth more with the original packaging then without.

 

Busting sets goes on all the time. If you can make enough to make it worth the time, do it. I have a lot of busted sets because I pulled out one coin. That one coin sold for more than the whole set was worth.

 

It's been forty years already. I think the market has stabilized.

I imagine a lot of Bicentennial sets got broken up during the 1980 silver spike, and a lot more during the 2011 spike. Even after that, though, they're still common and cheap -- they can probably be had for less than the $12.00 issue price, although they're usually listed for more than that. Figure $6 melt for the dollar, $3 or less for the half, $1.50 minus a bit for the quarter -- and 40% silver trades at a discount to melt. I don't think the dollar or half command significant premiums, although I think the quarter still does.

 

The reason the individual coins list for more than the whole set is because of the extra the dealer has to charge to make up for the headache of having to hold them and make individual sales. Selling the one set means finding one customer, making one sale and handling one set of paper work. Selling the three coins individually means he will probably have to hold them longer while he finds three customers makes three sales and has three times the paperwork. That is extra time, effort and costs. He needs to be compensated for that and the way that is done is by charging more for the individual coins.

 

I know two dealers who had a nice run cherrypicking all of the sets and rolls on the local show circuit. They would buy the sets with at least a couple nice coins, send off the good coins to be graded and then sell them. If you are buying the sets at $6-8 ea, sending off a couple hundred coins for $5 bulk grading and selling the product for $15, 20, 25 even 50... all it took was some capital and a good eye. But one has moved on, he's been through every set for sale in a 3 state area

 

Mike Mezack of HSN infamy calls the busting up of proof sets "the dirty little secret of coin dealers" while he is selling the 60-99 sets at hundreds more than available on eBay. He regularly throws out figures of how much more they go for as individual coins.

The obvious question would be: "Then why don't you break them up, Mikey?"

 

My guess is they go through hundreds of sets at a time and pull out all the sets with a very nice cherry coin and varieties. This will be about 10% of the total. Then they go through again and pull out every single one with a cull which will account for another 40%.

They fill their needs of singles from these first half then they sell what's left with the best boxes from the other half of the sets. The Gems go in for grading and the culls go into circulation.

Their customers actually get pretty nice coin in good boxes but without Gems or varieties.

 

The simple fact is most mint and proof sets are worth far more dead than alive. There just isn't much demand for intact sets but there is a continuing demand for modern singles.

What most people don't realize is the bulk of the sets are gone now. It's a disposable economy and most of the the sets are just gone.

 

But the supply that's left still exceeds demand, as you say.

 

I don't think Mezack spends time going through anything when he can multiply by two and find the suckers ready to buy his crap.

He likely assembles dirt cheap sets that already have been picked through for singles.

 

I don't know about PCGS, but bulk grading at NGC is NOT $5 per coin and it is higher for a PF70 or MS70 coin than one graded lower. You would think they would be the same price, but they are not. Then add in shipping to and from. NGC and PMG never ship regular mail. It's always FedEX if you have an acct. or registered mail insured which isn't cheap either.

 

Yes, exactly.

There is very small demand. A few people collect sets and a few people collect sets of denominations but most are just sold retail as singles to the general public. The attrition on these is extremely high since most people don't value them very much.

If you need a single coin from a set it's often cheaper to buy the set and just spend the coins you don't need. All these forces conspire to assure that there are fewer and fewer sets every year. Many of the ones surviving are now starting to tarnish because the packaging isn't stable and this is bringing more sets on the market and suppressing mint set prices even more as the singles continue to go higher.

 

I believe he's an actor. I don't know.

But they can't ship inferior product or it will be returned. When you're dealing with large mark-ups the last thing you want is returns. Somebody has to go through these sets and pull out the culls because this is the way they come wholesale. It's easy enough to just yank the culls while you're removing the good coins.

When there are more sets on the market than demand for the singles then there is supply for this type of promotion. Remember though that he's getting retail prices for the sets which isn't that much less than he can get as singles. It's just a matter of moving product and keeping it from coming back.

I'm not privy to their business plan but this is the way to maximize profit. These guys consume a lot of supply as sets and singles and are an important part of the market. Keep in mind though that their customers really are getting "better" quality and they are getting some break on price compared to buying the singles from HSN or one of the big retailers.

 

Keep in mind that each and every person who buys a coin item from HSN gets screwed in the neck. All one has to do is look up what they're selling on eBay for ironclad proof. Their buyers don't know enough about coins to return them within the specified time frame.

 

If you are doing bulk submissions Registered is actually quite cheap. To do bulk you have to have at least 100 coins. Say we have 100 coins worth $100 each. That's a $10,000 package which can be sent Registered for around $30 or a little less. That makes your shipping and insurance cost 30 cents per coin.

Considering most of their sales are probably to people that don't know coins they probably can ship stuff we would consider inferior and not get returns. The people getting it don't know it is inferior unless it is horribly bad.