WYNTK: What does a dealer really pay for a coin?

[James_OldeTowne]

NOTE: You may view the PDF version (21Kb) of this article on my website HERE. The PDF version is easier to read and includes better text formatting, and can be easily printed.

 

What does a dealer really pay for a coin?

factors that contribute to a coin’s actual “cost”

 

Introduction

Any rational coin collector does not mind (or at least, he shouldn’t mind) paying a reasonable price for coins he wishes to add to his collection. It is expected that, when purchased from a coin dealer, a coin’s asking price will include some markup above the dealer’s cost, such that he is allowed a reasonable amount of profit, without increasing the price of the coin beyond the reach of most collectors, and certainly not beyond what the market will support.

 

The goal of this article is not to define what an “appropriate” dealer markup should be, but rather to discuss some of the factors that go into the asking price of a coin in a dealer’s inventory. These factors must be considered when there is concern with regard to what a coin actually “costs” a dealer, and are especially important for those cases where the price of a coin is substantially higher than what seems to be reflective of current market conditions.

 

What is a “dealer markup”?

Given that a coin costs a dealer some specific financial amount, the dealer markup is simply some financial amount added to the original cost, which in turn becomes the “asking price” of the coin. Thus, if a dealer pays a collector $1000 for a certain coin and subsequently decides that $1200 is an appropriate price to ask for it at the retail level, then his markup is simply $200.

 

It is almost universally accepted by coin dealers and collectors that the asking price of any coin is negotiable to some degree, which is really a way of saying that the dealer markup is negotiable. Thus, following from our current example, the dealer may decide to accept an offer of $1150 for the coin – a $50 discount. The cost of the coin remains the same at $1000, but the dealer simply lowered his markup from $200 to $150 to accommodate the $1150 offer. The actual markup realized from the sale of a coin is referred to as the “profit margin”.

 

Coin dealers are entitled to make a profit

Of course, there is a limit to what degree the price of a coin can be negotiated. Only in the rarest of cases would a dealer allow a coin to be sold for even less than what he paid for it (resulting in a financial loss). It is very unlikely that the dealer in our example will price at $900 the coin that he just paid $1000 for! However, such a scenario could occur, if, for example, the availability (“population) of the coin suddenly increased, resulting in depressed demand, and a lower market value. In that case, the dealer may be forced to accept an inevitable loss. Typically, however, a dealer will make every effort to avoid taking a loss on sales of his coins.

 

Naturally, a primary reason for a coin dealer to be in business is to make a financial profit. In today’s market, it is reasonable to expect that if a coin dealer makes 10 – 20% profit(1) on each coin he sells, then he will have a viable and sustainable business, provided he has sufficient volume to produce enough cash to purchase new coins, and still support himself financially. Often, as is implied in our example, a dealer may add a markup that is larger than what he really expects to make, with the expectation that the final selling price may be negotiated down, but still be enough to cover the cost of the coin and a fair profit.

 

Factors that affect a coin’s “cost” to a dealer

Coin collectors often forget that there are several factors that contribute to what a coin actually “costs” a dealer. Not only is there the amount of cash that changes hands to pay for it, but usually, there is some amount of overhead expense that adds to what the dealer must actually spend to acquire coins.

 

Sometimes, a coin is seen to sell to a specific dealer at an auction, and subsequently appear in his inventory with an asking price that is much higher than the expected 10-20%. While it is certainly possible that the dealer could truly believe the market demand for that particular coin to have strengthened dramatically since the close of the auction, there could well be other reasons for the dramatic price increase.

 

Let consider an example in which a dealer attends an out-of-town coin show that lasts for three days (Friday, Saturday and Sunday). For our scenario, let’s assume an auction was held in conjunction with the show, and let’s also assume that the dealer typically works on a 20% margin. Now, let’s suppose that the dealer buys just two coins from the auction, a large-cent for $1000, and a rare Morgan dollar for $5000.

 

Without any additional considerations, our previous discussion indicates that the dealer would wish to price the large-cent at $1200, and the Morgan at $6000 – a 20% markup for each coin. Given typical negotiations, we might expect the coins to actually sell for $1150 and $5750 respectively. Thus it would appear that the dealer’s profit on these two coins will be $900 (150 + 750) – a tidy sum for the work of selling just two coins. That would seem to represent an excellent profit margin of 15% (900 / 6000).

 

Overhead cost

The astute reader of this article might now be questioning the plausibility of the example as given so far. What is missing from this analysis is the overhead cost of doing the show. In loose terms, “overhead cost” is comprised of ongoing administrative expenses of a business which cannot be attributed to any specific business activity, but are still necessary for the business to function. In the case of a coin business, they might be a bit less vaguely expressed as the expenses required to conduct business, but which do not occur as part of the cost of purchasing numismatic inventory.

 

In general, these expenses could include the cost of traveling to and from shows, hiring an accountant, supporting a website, the cost of advertising, and any number of other factors which are not directly related to the actual purchase of coins.

 

For the sake of this scenario, let’s assume that the dealer drove his car to the show to save on airline expenses. A simple expense sheet(2) for the dealer’s show experience might look similar to the following:

 

$154 . . hotel stay (2 nights), breakfast included

$ 9 . . (3) lunches

$ 13 . . (1) dinners

$ 48 . . (1) dinner with clients

$ 52 . . gas for the commute (for simplification, wear and tear on the vehicle are ignored)

$375 . . cost of table at show

$ 15 . . cost of joining club which sponsored show

$ 60 . . pro-rated cost of insurance for one show

------- -------------------------------------------------------------------------------------------------------------------

$726 . . TOTAL OVERHEAD COST

 

Thus, the overhead cost of attending the show was $726. If we now deduct the total overhead cost of the show from the dealer’s apparent $900 profit on the two coins, we discover that his actual profit from future sale of the coins will be a paltry $174 dollars ($900 - $726) – a mere 2.3% profit! For a typical coin company, a profit margin(3) of 2.3% simply will not support a successful business.

 

the actual cost of coins

Obviously, we must add the cost of doing to the show to the cost of the coins in order to be able to ascertain a more appropriate markup for the coins such that the actual profit realized will fall into the 10 – 20% range. Let’s decide to divide up the overhead cost between the two coins as $200 and $524 (200 + 526 = 726). Thus, the actual cost of the large-cent would now be $1200, and the cost of the Morgan dollar would now be $5526 - practically the retail prices that were expected before the overhead costs were considered! Adding in the 20% dealer markup yields asking prices of (approximately) $1,450 for the large-cent, and $6,600 for the Morgan dollar. Plainly, these new asking prices are substantially higher than what was calculated previously.

 

when a dealer’s markup seems high

For the observer who simply records what the dealer paid at the auction for the coins, and then observes his retail prices for coins, it might well appear that this dealer is marking his coins up well above the assumed market norm of 10-20%, as seen in the following table:

 

auction realized price . . . . . dealer asking price . . . . . apparent dealer margin

$1000 . . . . . . . . . . . . . . . . $1,450 . . . . . . . . . . . . . . 45%

$5000 . . . . . . . . . . . . . . . . $6,600 . . . . . . . . . . . . . . 32%

 

But as we have learned, this mistaken observation ignores the reality of overhead costs. Overhead costs are real, and cannot be ignored by the coin dealer when he calculate the retail price he will need to ask for his coins.

 

Conclusion:

When considering purchase of a coin that appears surprisingly highly priced, consider factors other than the dealer’s cost which may be contributing to the inflated price. A dealer’s profit must take into account his overhead costs, in addition to the actual cost of purchasing coins.

 

Notes:

(1) The author believes that a profit margin estimate of 10-20% fairly represents the reality of most numismatic transactions. This observation is based on numerous interviews with dealers, and by analysis of coins sold at auction, then immediately added to the purchasing dealer’s inventory. Average margins may vary considerably from dealer to dealer, and certainly from transaction to transaction. For example, some dealers who specialize in bullion items work on margins below 3%, but deal in very large volume.

 

(2) The numbers used to illustrate this example are based on an actual Chicago coin show attended by the author in 2001. They are an accurate reflection of reasonable costs for the show.

 

(3) For the purposes of this article, “profit margin” is being simply defined as:

 

(price – cost) / cost

 

Be aware that professional accountants define and use these terms more stringently and accurately than they are being used in this article

[Zoins]

Thanks for the post James. I agree a dealer should make a profit if they are providing a valuable service. If a dealer is buying at an auction that a customer can also buy at and then resells, I view the dealer markup as kind of a "consulting fee" the customer pays for the dealer's efforts to locate and pick the nice, original, eye-appealing, problem-free coin. If a collector is astute enough to buy with his/her own experience and has the time/desire to attend shows, then by all means compete for the coin at auction, but if he/she isn't, there's nothing wrong with buying through a good dealer and paying a reasonable markup IMO.

 

On the other hand, there are dealers where the markup is not worthwhile because the dealer hasn't been able to assemble a good inventory. Don't pay a markup just because you're buying from a dealer, you still have to recognize value in the markup to pay it IMO.

[EZ_E]

I firmly believe that for an individual to be a well-rounded collector, he must experience the sales end of numismatics. Not only will this make the collector a more astute buyer but also much more sympathetic to the dealer's plight.

 

My experience on the dealer's end came at a January 2004 coin show in Hot Springs, Arkansas where I rented a table at the show to sell some of my unwanted coins. Even though I did sell approximately $4,000 in coins, they all were sold at a loss. I did absolutely no retail business even though I had a wide assortment of quality coins. All of my business was wholesale to dealers.

 

Then factor in the cost of a motel room, travel/eating expenses and bourse fee and that margin is lowered all the more.

 

I learned that it is a very tough game to make money in coins, especially if one is honest and has a family to feed. I'm still baffled at how so many dealers can sustain an inventory and still make a profit.

 

So, I certainly do not begrudge a dealer for his markup and have a much higher level of respect for the difficulties a dealer faces.

[al_e_gator]

Good article.

I never have a problem with dealers making profit, as long as they are not gouging at 20%-40% above retail pricing (or more in some cases). What I mean by retail is published prices when averaging between the multitude of sources such as the Red Book, PCGS Price Guide, Coin World Trends, Numismedia FMV, etc ... In it of itself the prices in those vary +/- depending on the series, population, expected demands, etc. I've seen this behavior time and time again with some dealers, even with widget coins. My explanations for this behavior is as follows:

 

A. Dealer is selling a Kryptonite coin that is grossly undergraded.

B. Dealer is a terrible or desperate buyer who pays too much to begin with.

C. Dealer is just plain greedy.

 

While "A" is acceptable and the coin warrants to be sold at the proper grade value; "B" and "C" are not acceptable IMHO and I won't do business with dealers like that. It's a free market commodity and I sometimes find it hard to believe how some dealers have survived in the business.

 

On the other hand, there are also many dealers who offer good value and fair pricing (and a great wealth of knowledge). This can also mean that they may let some coins go near cost or make a marginal to nice profit if they have room to work. These are the dealers that I praise and reward with my business.

[Zoins]

My experience on the dealer's end came at a January 2004 coin show in Hot Springs, Arkansas where I rented a table at the show to sell some of my unwanted coins. Even though I did sell approximately $4,000 in coins, they all were sold at a loss. I did absolutely no retail business even though I had a wide assortment of quality coins. All of my business was wholesale to dealers.

Given that collectors may pay more than dealers because they pay retail and are not buying for resale or to recoup business expenses, do you think you would have done better selling these particular coins to collectors, perhaps in a different venue?

[cpm9ball]

You are so right, James! I'm not a dealer, but I'm not so dense that I don't realize the expenses involved. I used to travel quite alot to pool tournaments, and when you factor in the expenses involved, you realize that if you can't finsih high enough in the standings, you will lose money on the trip.

 

Thank you for reminding everyone about this. Now, how much do you want for those Kraft Morgans?

 

Chris

[EZ_E]

do you think you would have done better selling these particular coins to collectors, perhaps in a different venue?

 

Most definitely. What really hurt me was the lack of retail buyers. There were alot of browsers but no one serious.

 

It was a great experience but, at the same time, a bad experience as far as fulfulling my goals at the time.

 

Oh, I did win a Liberty $5 gold coin as a door prize. But I gave it to my brother who sold it for crack.

[gedis3]

But I gave it to my brother who sold it for crack.

 

Oh my... I think I would have a brother with 2 black eyes and a cowboy boot that would have to be surgically removed from his posterior.

[jesbroken]

It has always amazed me how people dealing with companies made up of individuals treat these individuals completely different than large corporations without faces. An individual businessman/seller will be there for you often times on his own time, answering your questions, giving advice, looking for coins for you to buy that you change your mind about, keep an inventory for the buyer to select from and browse away time without always buying anything, yet, the buyer will try to advise or demand what markup for this inventory, building, overheads, freight the seller can or should sell for.

Then this same buyer will walk into a major corporate sales organization and pay what they ask, never asking them for advice nor questions other than the obvious and certainly not expecting them to find something for them or calling them at home tonite with the results.

It is very difficult for a coin dealer to even exist much less make a profit. When you think of old C & A Coins whose been in business for 50 years and you assume is quite rich, then think of the 60 or so dealers not around who used to be right beside them. I feel for the average coin dealer and certainly would not support the thief. If the price is to high for your budget move on to something else but don't suppose you know the dealers cost of inventory.

Jim

[Wihlborg]

Oh, I did win a Liberty $5 gold coin as a door prize. But I gave it to my brother who sold it for crack.

 

Well, I guess you can say that went up in smoke.

 

John

[MunkyMan95]

[TomB]

Good post, James.

 

I've taken many tables over the course of the last ten years and not only must one take into account the true cost of coinage obtained, but if one figures the profit on a per hour basis then the results can be staggeringly depressing.

[just carl]

Decent but to lengthly article in favor of dealers. However, does not take into account the numerous dealers that aquire large volumns of coins at rediculously low prices and resells for much, much higher prices. Most dealers I know would never consider selling a $100 coin for $15 because he purchased it for $5 or $10. They would sell it for at least $80 or $90 and tell you it cost them $75. I've seen way to many dealers purchase such deals as a bag of Merc Dimes for double face value. Went back later and asked how much he wanted for the same bag and was told depends on the coin. Was at H.J.Berks and witnessed 2 rolls of Buffalos Nickels purchased for $5/roll. Just saw a dealer at a coin show purchase 2 complete sets of coins for $6,000. Merc and Wash Quarters all in MS conditions. At the same show he sold the 16D Merc for the $6,000. I knew the dealer rather well and asked if I could buy that Merc for a decent price. His price was $6,000 to anyone. We have 3 coin shows a month around here. Most dealers are local, do not spend hotel, motel, etc. Many have brought their own food and drinks. Most do not travel more than I do to get there. Many have a family member helping. Most pay about $50 per table and they don't have to bring tables or chairs because for that price they are provided. Most of the dealers at these shows work on large amounts of profits and regardless of how well they know you as a customer, your still just a means of profit. We have numerous coin dealers that work the flea markets only and their output is minimal compared to those at coin shows but thier prices are the same.

I know there are many dealers that fall into the situation as noted in the article but not all. For example the dealers that go to the large coin shows in other states do have these expenses. However, that is what they want and are charging customers for thier expenses accordingly. I discussed this with a dealer at a large coin show that came from Texas. His output of money was so large that he felt he had to charge as much as possible for each sale just to break even. Coming here is his choice and I don't want to pay for that.

[World Colonial]

I do not care what a dealer pays for their inventory. The question for me is the same as what you said, whether the dealer "adds value" (to use corporate speak) to the collector which gives them a reason to buy from them. In today's market, that is usually going to be either access to inventory that is not available elsewhere, expertise that the dealer has and that the collector does not, or personal service which is better than other dealers.

 

Making money is difficult in any business, that's why most of us have an employer. But I think it is also accurate to say that the typical dealer does not provide much of a reason to do business with them.

 

I happen to collect only world coins, but even if I did not, the few dealer shops I have and used to visit carry US material that you can buy anywhere and that is also what I see on most dealer web sites.

 

One dealer who appears to be very successful is Northeast Numismatics. They have a very good selection of both US and world coins and their prices are reasonable (IMO) even though most of the coins they offer are not cheap. For world coins at least, I know that part of their business model is to attend major auctions and buy coins raw and get them graded. The markups on some of the coins are well over the percentages James listed but that is because they are able to buy coins that are not generally available elsewhere, that are in demand and they have a good eye for coins that will grade higher than the auction catalogue.

[MikeKing]

good and fair post, James. Sometimes I wonder how coin dealers do it. How do they make a living. Honestly. I'm sure it's a difficult business, and I have no issue with a dealer getting a really decent amount of money for having found the coins he/she is selling. The only time I'll negotiate a price is if I think the coin has been exaggeratingly valued, which is not often.

 

I have bid on coins however, lost them to a dealer at auction, only to see the coin with a 40-60% markup, which just drives me wild. But I've found that the exception rather than the rule, at least for the ones I work with.

 

These same dealers may tell me my coin is too 'oily' or some unflattering comment like that, if I didn't buy it from them. These are dealers I could never trust. It's the same in the violin business. You buy one that they rave about for 20K and you try to sell it and they look at it like it's a violin from hell. Can you trust these people? No.

 

But there are plenty of honest dealers out there who I'm sure are working very very hard for their income.

[stman]

I understand a dealer has more overhead than just the cost of the coin. But honestly, if they travel and stay two nights and only buy two coins..... I'm certainly not going to support all their expenses because they only bought two coins, and they feel they should break even or make a profit, and pay for the trip and expenses for two coins. Sometimes there is just a cost of doing business. If they can't buy more than two coins traveling to a show and expect to recoup everything.... perhaps they should be doing something else.

 

Not trying to be harsh, just honest and that's just what I'm about.

[James_OldeTowne]

But honestly, if they travel and stay two nights and only buy two coins..... I'm certainly not going to support all their expenses because they only bought two coins, and they feel they should break even or make a profit, and pay for the trip and expenses for two coins.

The show as detailed in the discussion really did happen - a show I did a few years ago. Although I did in fact only spend $6000 on coins, it was quite a few more than two coins. I just boiled it down to an example with two coins in order to make the math concise.

 

Thanks all for the EXCELLENT comments, suggestions and feedback, both pro and con, and both in the thread and via pm. I am very pleased with the discussion this topic generated.

[DirtyGoldMan]

I like James a lot and always enjoy his commentary, but I think that he presented a narrow view of dealer mark-up, and one that is not shared by a large number of his colleagues. For example, he omitted any discussion of upgrades, which I suspect largely is due to his honest, transparent, anti-slab approach. Heck, I just saw a coin on a dealer's website that was purchased at auction earlier this year for $5000, upgraded, and sold retail for $11,000. Many dealers are active in the crack-out game, and if you are good at it, the sky is the limit.

[World Colonial]

There are a few dealers that I found recently that carry one of the world coin series I collect and they sell all their coins raw. And frankly, I'm not sure why they do it even though it is better for the buyer.

 

I recently saw a coin listed on eBay for $1000. It is an MS-65 piece and the same coin I saw listed uncirculated raw (no picture) in this dealer's monthly price list for $125. I tried to buy the coin but was late. Would I buy this coin from this seller? (He is what we call a "vest pocket" dealer. I think he is retired and does this to supplement his income.) Sure, but nowhere near this amount. Since I know what he paid for it, I might consider offering something say like $600. (There are zero prior sales that I am aware of to use as a reference point.) I will not get it for that if someone is willing to pay more but I know that he could sell it to me for that and still make a good profit.

 

I also bought several other coins from two other dealers last week. All of them were at catalogue at MS-60 price even though they are better than that and the catalogue is way underpriced. I'm not interested in selling them but I am going to get them graded.

[James_OldeTowne]

I like James a lot and always enjoy his commentary, but I think that he presented a narrow view of dealer mark-up, and one that is not shared by a large number of his colleagues. For example, he omitted any discussion of upgrades, which I suspect largely is due to his honest, transparent, anti-slab approach. Heck, I just saw a coin on a dealer's website that was purchased at auction earlier this year for $5000, upgraded, and sold retail for $11,000. Many dealers are active in the crack-out game, and if you are good at it, the sky is the limit.

Robert, that's an excellent point, and indeed, I'd be very interested in a WYNTK thread about markups that are in fact "excessive". I agree that there are "dealers" whose only motive seems to be swinging for that "home run", and personally, I can't stand that kind of non-hobby-oriented nonsense.

 

I'm not sure how one might address this issue, but I think it could be a pretty hot topic.

[James_OldeTowne]

It looks like my friend Dennis ("numisma" ATS) was kind enough to link the article on the PCGS forum .

 

An interesting question that was raised was to question some of my expenses (remember, the examples given were from a show I really did do in Chicago). One contributor thought the expenses were very low, in particular, $9 for (3) lunches. I'd like to point out that I keep my overhead as low as possible by bringing my lunch to shows! I don't eat lunch out, if I can help it. Also, for dinner, I go to low-cost places. If memory serves correct, I treated myself to a place called "Fazoli's", a fast-food-ish Italian restaurant.

 

Had I made more money at that show, I could have had steak and seafood !

[Houston Investor]

To make it in the coin business it takes an average markup of at least 40%.

[zrlevin]

To make it in the coin business it takes an average markup of at least 40%.

 

Yes, but I think that we can agree that you are not the most honest of dealers.

[World Colonial]

In any business, you make a profit based upon a combination of margin and volume. I have always understood the typical coin dealer with a retail shop as a low volume outfit which means that the only way they can make any profit is through a high margin. One reason for their low volume is that the value of the typical dealer's inventory is usually not that substantial so they need to turn it over as quickly as possible.

 

From what I can tell, the typical dealer does not have very many very profitable customers. The average collector does not buy that much in a month or a year. I work for a major credit card company and I can tell you that there are a small group of customers who are literally as profitable as 1000 average or even 10,000 low spenders combined. The big coin outfits get the big spenders while the typical dealer gets the little guy.

 

When I was a kid in the late 1970's and early 1980's, the dealers I visited would generally not offer more than 60% of retail (Redbook). (One dealer offered much less.) That is a mark-up of 66%. Anybody can criticize the markup regardless of what it is, but as long as the dealer is honest about what the coins they are buying and selling are worth, there is no reason to do so. You can always vote with your feet and take your business elsewhere if you do not like it.

[EZ_E]

I recently bought a PR66 1942 Mercury dime from Mark Feld for $310. He had a mere $40 mark up on it and had to cover shipping out of that. That same week, I saw same date/same grade/same slab sell for $385 from one dealer and over $400 from another. Mark is an aberration in the coin world, though. He has extremely high integrity and always strives to be more than fair with his prices.

 

So, this adequately shows that prices go all over the board depending upon the seller. I recently saw an AU55 1831 half dime being offered for almost $500 on a major dealer's website. This is beyond extreme! And there was nothing special about it, either.

[just-john]

This just happened to me and has happened in the past.Most of my friends know I collect coins and have for years.But my business was in the shooting sports industry.Yup im a gun nut??Friends have wanted to trade different things and want to know what I would give them for almost everything under the sun.In the past I would look up coins in the Blue book

check grade and give a price.Well after awhile I was going broke had stuff but know cash.

Now with coins I tell people take the coin to a coin store and see what they will pay for it there.This week Friend of a friend of a friend wanted this rifle said the dealer told him the coin's were worth maybe $150.00.Five Liberty head nickels 1883 no cents VG 1883 with cents1884 about AU 1885 au50 or better 1886 EF 1888 EF .Dealers seem to be doing pretty good from what i can see

[DirtyGoldMan]

I recently bought a PR66 1942 Mercury dime from Mark Feld for $310. He had a mere $40 mark up on it and had to cover shipping out of that. That same week, I saw same date/same grade/same slab sell for $385 from one dealer and over $400 from another. Mark is an aberration in the coin world, though. He has extremely high integrity and always strives to be more than fair with his prices.

 

I think that this example is a good illustration of James' point. Mark, a national dealer, works with an extremely low overhead, just as James does. Add a fancy website, big table at shows, employees, full page ads in Coin World (those suckers are expensive!), stays at expensive hotels, lots of flights, etc. and the overhead shoots way up, as does the price of the coins.

[James_OldeTowne]

What Robert states is correct. I work on the (VERY) cheap. There is the other extreme, dealers who fly around in jets, stay at the Hilton, use limos and take advantage of other luxuries. While I don't begrudge them that, it's just examples of both extremes.

 

I do want to point out that I am not a typical example of a dealer (indeed, I am not a dealer, just a collector who sets up at shows sometimes, and has a cheap website), and so my discussion isn't typical of most full-time dealers. They do have quite a few more expenses than I do, not the least of which is a salary. I have never taken any equity out of my "business", nor do I add any more outside money to it.

 

Every dime I "make" selling coins goes right back to buying new more coins. As a hobby, it allows me a taste of the opportunities that real, professional dealers get in seeing many coins, and owning some neat ones for awhile. There are of course some coins in my core collection, but generally, much of what I own is always for sale at some price.

 

I have been told by many multiple professional coin dealers that if you want to be a real dealer, then you can't be a collector. Thus, I've decided not to be a real dealer, but just remain an hobbyist.

 

Again, please don't take my example coin show as being typical of professional full-time dealers. It was just a scenario for which I had actual, useful numbers that could serve as an example of what I was discussing.

[EZ_E]

I recently bought a PR66 1942 Mercury dime from Mark Feld for $310. He had a mere $40 mark up on it and had to cover shipping out of that. That same week, I saw same date/same grade/same slab sell for $385 from one dealer and over $400 from another. Mark is an aberration in the coin world, though. He has extremely high integrity and always strives to be more than fair with his prices.

 

I think that this example is a good illustration of James' point. Mark, a national dealer, works with an extremely low overhead, just as James does. Add a fancy website, big table at shows, employees, full page ads in Coin World (those suckers are expensive!), stays at expensive hotels, lots of flights, etc. and the overhead shoots way up, as does the price of the coins.

 

Any truth to the rumor that Mark shacks up at the local WMCA while attending shows?

 

[The rumor starts here]

 

And, yes, James is one of the good guys as well!!!

[PerryHall]

Any truth to the rumor that Mark shacks up at the local WMCA while attending shows?

 

What's the WMCA? Did you mean the YWCA?