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 Replies: 9 / Views: 2,194 |
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New Member
United States
45 Posts |
I was chatting with the local LCS about selling some of my 90% silver. They said they would pay $11 per $1 face value. THat would mean, 3 x 90% Kennedy half dollars would fetch $16.50. The asw for these three is 1.0851 oz of silver. Why do they pay less for 90% than a 1oz .999, even if there is enough silver in the three coins to equal to a 1 oz .999 coin? Refining costs? |
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Pillar of the Community
7234 Posts |
Quote:
Refining costs? I'm sure. Instead of just melting the .999 silver into ingots the refinery has to melt the .900 silver and refine it to .999 involving more time/materials = cost. |
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Pillar of the Community
United States
997 Posts |
Being a business they will buy at a price less than they would sell at. If they can get 12x for it they have to buy at less than that to make money to pay the light bill and rent, salaries and maybe eek out a little profit.
It also costs money to melt and separate the metals (if they even do that).
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Bedrock of the Community
United States
94367 Posts |
Agree.  to the CCF! |
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Pillar of the Community
 United States
4588 Posts |
They have to pay for the rent, electric, heat, lights, security, insurance, salaries, before they make a few bucks to eat.
-----Burton 50+ year / Life / Emeritus ANA member (joined 12/1/1973) Life member: Numismatics International, CONECA Member: TNA, FtWCC, NETCC, EveryCountry (online) coin club Owned by three cats and a wife of 40+ years (joined 1983) Author: 3rd Edition of the Sample Slabs book, https://www.sampleslabs.info/ |
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Pillar of the Community
7234 Posts |
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They have to pay for the rent, electric, heat, lights, security, insurance, salaries, before they make a few bucks to eat. yeah - I don't see how a coin shop owner makes a living now adays. Only one out of the 12 coin shops in the county I live in has kept their doors open for the last 15 years, although he has also expanded to selling jewelry, Bed mattresses, and opened a pawn shop in the same building. Everybody else has closed up shop. |
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Valued Member
United States
154 Posts |
A couple things come to mind:
1) Demand: Demand seems to be higher for bullion than 90% coins. You pay less on the front end, and get less back at the back end.
2) Wear. A lot of 90% coins were circulated and thus suffer from wear. I know some places will weigh the coins before buying instead of paying a set value for face because of this.
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Bedrock of the Community
United States
11951 Posts |
Learning what you can buy and sell silver for is, something all collectors/accumulators
should learn.
I have had customers come into the LCS and actually ask why he can't buy
and silver for the listed spot price. He thought if silver is $18.00 per oz.,
then he should be able to buy at that price, or bring in silver and sell at
that price. He ended up getting angry that he could not and left mad.
There are many factors on how coin shops decide what price to charge for
silver. And is different for each type of silver.
Most coin shops, if not all, do not melt their own silver. They take/ship it
to refiners. What the refiners pay does have a lot to to with what coin shops pay.
As others have posted, the cost of running a coin shop is so high it is hard
for me to see how so many are still in business. One cost many don't think
about is the state and federal business tax. It takes a big bite of of what
little profit is made.
Edit ... I forgot to mention .. when the dealers sell to refineries, the refiners don't pay spot either
Edited by GR58
03/03/2017 08:42 am
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New Member
 United States
45 Posts |
Thanks for the info folks, I guess 90% has more hassle attached to it for all parties involved in the process from seller to refiner.
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Bedrock of the Community
United States
17884 Posts |
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One cost many don't think
about is the state and federal business tax. It takes a big bite of of what
little profit is made. And don't forget the 15% self-employment tax, and regular income tax. Just those two will consume roughly 30% of any profit he makes. |
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Replies: 9 / Views: 2,194 |
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Posted 03/02/2017 3:05 pm
