Dealer Profit Margins? Interesting Haggling Exchange!

Most retailers ARE solely middlemen. It's pretty rare for the manufacturer to be directly involved with running a retail store unless it's a custom shop.

In general, bullion traders run off a pretty tight margin. There is a big difference between having to hold an item until the right customer shows up to buy it & being able to ship it out the back door at a set price as soon as it comes in the front. The risk is a lot lower.

I run a small antique business. The most common markup in my area runs from 2 to 3.5 times cost. Probably 50-65% of my business is in jewelry, sterling flatware & coins. The markup on those items is nowhere near what I can markup antiques. The only reson I deal with those items is the rapid turnover, otherwise it wouldn't be worth my time.

OneBowl, Pawn shops most definitely ask how much you paid to use that to lowball. I would never answer that question - probably would do an "I don't remember its been so long" if they insisted. It is irrelevant whether I found it on the sidewalk or was given it as a gift or paid 2X the going rate - which is why I detest the "that's more than I have in it" stuff. Just because you got ripped off is not a valid argument for why I should now as well. What they paid for it is their problem. Yet many use the "I gotta make a profit" thing ad nauseum.




I am mostly talking about locals who sell at coin shows. They have no shop with lease, utilities, employees, overhead etc. I doubt they can afford accountants. I agree that #s can be manipulated, but I genuinely believe that they have almost no overhead - many use their wife or kid to help them or have no helpers at all.

I think many ebay sellers/dealers also have little overhead as far as employees and B&M shops. But in a lot of ways that is not my concern as a buyer. I am not interested in paying your overhead in an internet coin deal to make up for your lack of profits in a B&M store you run. So the idea that 50% or 100% markup is justified because of those factors makes no sense to me. If the seller bought a collection off of an ignorant "old lady" seller at 10% of FMV that doesn't mean I am justified in expecting to pay 50% of FMV because it is still a large profit for the seller and a 400% PM.

I was looking at my historic buys off that dealer. I once won an auction for $283 on a '21 solid VF Walker from them. But that doesn't mean I "owe them" in future dealings. Each coin and deal is separate. Track record is a factor, but I just don't buy that it justifies pretty high mark-ups, IMO.

I recently had a seller "whine" in his feedback that he took a bath on the coin due to the low auction price I won it at. Ironically, he has a lot of BO listings I had bid on but we were never able to come close to a deal in haggling. I think he resented that it was me that won the low auction - after never meeting his price on one before. He has a lot of blast white SLQ, and buys them as well, so when looking for those they pop up on searches a lot. I found his buy of that coin in his history - and he had paid almost double what I won it at - OUCH!

My family is often impacted by my work and being on-call 24X7, that is part of the package and I don't ask that they be paid when we are all inconvenienced by it! Not everyone has their hand out expecting to be paid for every little favor or help.

I'm not necessarily saying that they work for free, but more that they aren't necessarily highly skilled expensive labor being employed. Most of them sit and read and only do anything at all when hubby is away on a break (you'll have to wait until he comes back to get a quote) or to load and unload the display cases from the car. Point is it's not a huge payroll issue for them. Many go it alone and just ask their neighbor to keep an eye out when they take a break.

Numismedia has the 1921 Mercury dime listed as having a FMV of $120 in F condition. I'm not a Mercury expert, but assuming the coin is a problem free F or better I don't see the price as being out of line. The fact that it sold at that price is an indication that that's the fair market value for that coin.





You are comparing apples to oranges....unless one of your family members is required to go with you when you are called in.

I think that 6-8% profit margin is unrealistic. Take your ebay seller for instance. According to his feedback he averages about 1300 sales a month. Let's say he averages about $50 per sale(just an estimate from scrolling through his feedback). That gives him $65000 in gross sales. At 8% profit he makes about $5200 a month. That is before fees and shipping costs. Not to mention the fact that he would have to procure, list and ship 8 coins per hour (or about one coin every 8 minutes) if he were working 8 hour days with no help.