Coin Dealers-What Do You Do?

Merchandise is procured through buying from walk-in customers, buying at coin shows, buying from other dealers. The big thing is to get your name out there and let people know you are buying. Depending on what competition you have in the area, you may need to do some convincing that you are fair and worth their time to come to you versus a more established dealer in the area.

Our shop wasn't terribly busy. We focused more on scrap gold and bullion since we didn't have a strong collector base for numismatic items. In fact we had stuff that came in on day one of opening that was still in inventory when we closed it. Knowing what your customers want and what you can turnover quickly will be key in determining what you should pay for an item. It will come with time.

For bullion items, it's more or less a commodity so our angle to get people to come to us was mainly two things. One is that we would pay cash. Most dealers in the area would pay by check. With gold and silver prices were they are now compared to where they were when we operated, cash only may not be feasible. But I will tell you that customers loved that. Also, when they brought in 90% "junk" or bulk wheats, we would take the time to go through the coins and pay a little extra for better dates. Many dealers in our area don't do that, and our customers really appreciated it.

You always have to watch out for stolen items because if you're caught with stolen items, you will be out the item, you will be out the cash, and depending on the area you could be in trouble. Make sure to ask the right questions when buying like asking them if they are/were a collector, how they got the items, etc. You can do it in a casual, non-invasive way and if something doesn't feel right, there is nothing wrong with telling them you are not interested.

For safety and protection, you obviously want a good security system. Be careful of contract terms though so that you're not paying a huge cancellation fee if you decide it's not for you. Also you need a good heavy duty safe. One that is too heavy for 1-2 people to move with ease, something that may bolt to the floor, fireproof, etc. I would suggest also having a firearm handy. Even if it's just there for show, that alone may give thieves something to think about. You want to have two people at the store at all times if possible as well. When closing up for the night, of course you want to take a different route home each time and check your surroundings.

For selling, make your prices clear. Also, don't be afraid to tell someone no if they lowball you on an offer. Negotiating is part of the game, and alot of people these days want a deal on everything. Stick to your guns and set the expectation up front that you are not going to be walked all over but also be fair with your prices or if someone is wanting a deal, ask for something in return. It wouldn't hurt to run specials either. Something like "Morgan Mondays" where you give a certain discount on Morgan dollars.

Advertising is a struggle. What I mean by that is deciding where to spend your money advertising. You're going to get blitzed by salespeople wanting you to advertise in the different media like local newspaper, the weekly shopper, the monthly value pack of deals that goes out, etc. Coin shows are a great way to get the word out and make some customer connections and sales. Also, get involved in the local coin club to get your name out there.

Just a few thoughts off the top of my head that I hope will help. Good luck.

This may sound like a silly post, but I am completely serious. A tip I could offer would be to make sure you develop (or have) good social skills and a positive attitude. Treat customers in the coin shop the way you are treated at well run retail stores--with interest, a smile, and integrity and patience.

At all the coin shops in my area, the owners are rude, inconsistent, and make me feel very uncomfortable. I only go to one guy these days just because he has amazing deals. I avoid the rest, and pay more for things online sometimes, just to avoid their utter anti-social behavior.

If only they knew how much more I would have spent if they were friendly and courteous and engaged me in innocent numismatic conversation (when they aren't busy).

I know I can't speak for everybody, but I want to go to a coin shop, I don't want to buy on ebay or online websites. The owner's in my area have been so horrible to me for me to not even do what I want.

So don't do that, that's my advice

Yeah, you certainly don't want to run a shop unless you are very knowledgeable about coin sets. The shop where I go, about half of them are pretty cool and will talk to you and tell you various things. I told them I was just getting back into collecting but didn't really remember much. They did give me a lot of seemingly good advice and gave me stuff for free as well.

A good way to build your way in is to work the show circuit. Take a table at the local club shows. It will get you exposed to a lot of collectors and let you start buying and selling with low expense. It will also start to insert you into the dealer community. Keep rolling profit back into stock and build your inventory. As your inventory grows you can start including the larger state and regional shows which will increase your contacts, exposure to better material and possibly allow you to move some stuff that doesn't go well in your area. You may find that the show circuit is more to your liking than being tied down to the expense of a Brick and Morter location. Or you may find that being a dealer just isn't for you without committing the funds to the expenses of a shop. I did shows for three years before I decided I'd rather just be a collector.

Most of the replys already tell you how to run the buisness. However, there is a lot of other things to consider also. For example the location. Just has to be in a place that gets a lot of traffic or it will never be seen.
And remember if you rent a place, there is rent and normally gas, water, electric bills to pay for. Then of course a phone bill which should be a land line, not just a cell phone. Possibly a FAX machine and a separate number for that too. You would need large display cases with locks. Chairs for yourself and customers. Really good lighting fixtures. A place for all the so called nickel and dime things that most people never think about at first such as a broom, vacuum cleaner, glass cleaners, towers, soaps, toilet paper, paper towels, pencils, pens, writting paper, fax machine paper and that list could go on for a long, long time.
And you need all that STUFF when you first open.
Visit as many coin shops as possible and look around. Try to see what they carry for merchandise besides actual coins.
And as already noted, if you don't know how to talk to people, forget that buisness.

Wow thanks guys that helps a lot. I obviously have a ton to learn before I even think about this, especially being 16. I have had some experience selling things and interacting with customers, and I will need to get more as y'all said. I can take that the most important aspect of running any business is (finances excluded)people skills, right?

And being a business you will find that you will be paying a much higher rate for all of those than you would as a residential customer. Oh and of course the deposits for those utilities that you will have to pay before you even open. here where I live the gas company deposit equals half a years billing, about $1500.

Quote: This may sound like a silly post, but I am completely serious. A tip I could offer would be to make sure you develop (or have) good social skills and a positive attitude. Treat customers in the coin shop the way you are treated at well run retail stores--with interest, a smile, and integrity and patience.

At all the coin shops in my area, the owners are rude, inconsistent, and make me feel very uncomfortable. I only go to one guy these days just because he has amazing deals. I avoid the rest, and pay more for things online sometimes, just to avoid their utter anti-social behavior.

AMEN! I drive 30+ minates out of my way.... to the next town over...... passing two other dealers coin shops, because my dealer has fair prices and he is not rude or condescending when I ask a question. Also, when he see's me he will come out of his office and atleast say "hello"! But often offers to help me eventhough he has one or two other folks in there to help me. I almost always buy "Something" as I feel there is value with this level of service and Friendship!
(Same thing is true of gunshops.....that often give bad customer service!).