Hi all, just wanted to share my experience yesterday in a coin shop in Melbourne. I won't name the store, but it was in a suburban shopping centre in the North East. It was my first time visiting this store, and from the outside I was most impressed. Really nice retail space, large and roomy, heaps and heaps of coins on display, particularly lots of commemorative crown-sized coins of the last 40 years or so. The gent behind the counter was really pleasant and helpful. I was thinking to myself how good it was to have found a new coin store (it's not new, I think it's been around for decades, but it was new for me) and I was already planning my purchasing future there. How good it would be to support another small independent retailer and a coin store like I remembered from 30 years ago when they seemed to be in every second suburb. Etc etc. So it came to the crunch: I asked about the prices on two basics for us stackers. 1966 50c piece = $18 each. Current melt value is $12.43. standard bullion (non-numismatic) gold sovereign = he said "prices start from as little as $500". I know of a CBD store where you can pick these up for $350 each this morning. The owner then asked me if I'd been collecting gold and silver very long. I fibbed and said I was new to it, and he told me I really should be getting on board. I then thanked him for his time and politely left. Wow. Talk about price gouging. I understand every coin store has to make a profit, I don't begrudge anyone that. But bloody hell, almost 50% above spot price!!! Needless to say, I won't become a customer of his. Which is a pity, as I really wanted to support a small suburban coin shop. I guess those shopping mall rents are much higher than I thought! And at those prices, I understand why all those little independent local coin shops all died off over the last 20-30 years - if that's what he has to charge to make it a viable concern, who would pay his prices? Anyway, I thought it was interesting to see what kind of traps are out there for the unwary and those new to stacking. Further evidence to DYODD and be as informed as you can be. Cheers, Bungo
Yeah I saw similar prices at a market on the weekend here in Brisbane. $18 for 1966 50c pieces. He freely said there was about $12 of silver in it, but the price remained. Didn't bother arguing the point coz as you said It's easy to find cheaper... I figure most people don't buy coins unless they know what they're looking at, so I can't see that he'd sell too many... but then again maybe if he's a good salesman he could convince a few people? Meh.
In my experience, relating to the store owner you're educated and market aware can result in a rather beneficial outcome. It only takes the opening 30 seconds of chatting with a new potential dealer to make them realise I know the product, market and costing far more than the average joe. A stacker means repeat business and for what they may lose on an individual sale by moderating prices, they can make up a fairer margin on repeat business. I've been able to set up trade deals with operators this way that are still mutually beneficial, but more reasonable and moderate on pricing than the prices offered to all and sundry. Good dealers will very quickly recognise the value of sound repuations with market players. I'm not talking about little jenny and her single 50c coin per week, or bobby buying the latest Perth Mint collector coin as a gift - but regular stackers like us folks who buy regularly and in volume. Not only can you secure repeat business from the individual taking such an approach, but you also get free word of mouth advertising. New dealers and small operators who operate purely on the ignorance business model never last. Like these gold buying scammer kiosks in shopping centres at the moment? Flash in the pan. Once the market gets more educated, they'll have to kill their margins or go under, assuming people just don't avoid them alltogether because of bad rep. So next time, just have a quick chat with the owner. Inform them you are a market player and that you are keen to conduct business as long as he's not over charging for product. It's then up to the dealer to come to the table with a reasonable offer, else you can walk away.
Might not just be gouging to make a profit, if they've been running at a loss for a while then they may drastically raise prices in an attempt to cover costs.
I have no problem with their $18. Markets and buyers is what it's all about. If they were saying 'bullion silver' $18 then buyer beware, but a coin shop selling an item at a nominated value then so be it. Perhaps in 18 months $18 will be cheap.
Hey, I totally get that the owner has to make ends meet and put food on his family's table. I was just surprised at how much over spot he was. If he has to go to extremes, so be it, but I suspect that would just compound the problem of too few sales. I guess that's between him and his accountant! He's obviously smart to still be in the game after so many of his competitors have fallen away over the years - good luck to him if he gets buyers at that rate. Seriously. Like I said, he was a very pleasant and nice guy, and the shop looked great ( I think we've all bought from poky little shops that smelt bad, cases were covered in dust, etc). I really wanted to support him, but I'm not willing to pay a 50% premium for that warm and fuzzy feeling when there are other retailers who are just as nice, and some who are still small and independent, but don't have such a huge premium. Put it this way: would you pay $18 for a 1966 50c piece today just 'cause I'm a nice guy? If so, I'm sure we can arrange something! Just my 2c worth.
It is a "COIN" shop and they will work on Numismatic value. However I agree totally with Auspm have a discussion and advise you are looking for Bullion coins only and not wanting premium products. I can tell you I have picked up some good deals with this approach and recently. Give it a week or two and go back with what Bullion do you have and let him know what prices you are looking for roughly say % over spot. Remember they may have kilos of the stuff out the back they purchased at cheap rates ? Good luck
I think I know the shop. Ask about the price when buying '66 in bulk, not just the price for a single. They have regulars who come and buy the lot when they come it - ask to put your name down when the next lot comes in.
I went to Peter Strich in the city a few weeks ago. Was quoted in the shop $430 for the 2010 Tiger 3 coin set and he had them listed 'buy now' on ebay for $350. Given on the $350 ebay fees/paypal fees would also come out of it, I thought the store price was a bit of a cheek and left.
