Every day at my company I am aware that the bullion-priced precious metals coins and bars that we sell can also be purchased from any of the nation’s 5,000 coin and precious metals dealers. These products will be fungible, meaning that they will be of identical quality wherever you purchase them.
On that basis, you might think finding the absolute cheapest seller would make sense. Maybe it does. But, many numismatists and precious metals investors have found out the hard way that it wasn’t necessarily the best value.
This year two online dealers went bankrupt after trying to claim the crown as cheapest seller of precious metals coins and bars. In both instances, thousands of customers who had paid for merchandise received nothing.
There is also one competitor who claims to offer low prices, but will not confirm any transactions until after they receive good funds from buyers or the merchandise that sellers are looking to liquidate. Effectively, this company does not offer the ability to lock in buy or sell prices unless the customer has committed to trade with this company in advance of when they might execute a transaction.
Ideally, buyers and sellers would prefer to work with dealers who not only offer the best prices, but also deliver great value above and beyond price. In reality, there are almost always trade-offs.
What kind of values could a coin and precious metals dealer offer that might be worth more than the lowest selling or highest buying prices? Here are some to consider:
• Ease of reaching a human being over the telephone. At my company, our customers are so important that their calls are answered by a human being instead of voice mail.
• Friendly staff, whether in person, on the telephone, or by email.
• An informed staff who can actually answer detailed questions without having to constantly check with someone else.
• Provide straight information rather than high pressure sales puffery.
• Strict quality standards for products offered to customers. The standard at my company is to sell merchandise that we would like to repurchase in the future.
• Offer significant market information so that customers can confidently make their own decisions. Note that this also makes such dealers trusted advisors to their customers.
• Pay attention to what customers are seeking to accomplish with their transaction, not what the dealer might want to push to maximize profit on this one trade.
• Fast shipment of customer orders and payments for merchandise that is purchased.
• Indefinite guarantees of authenticity as described of the merchandise sold.
• If there is a problem with a transaction, it is resolved quickly.
• Honesty and keeping promises. In other words, integrity.
• Supporting the hobby and industry as signs of commitment to numismatists and precious metals investors.
As you read through this list, you are likely to see several reasons why a dealer who offers such services might deliver greater value than another who competes strictly on price.
As you look across the country at the most successful and longest surviving numismatic and precious metals dealers, can you find even one that primarily focuses their appeal on being the lowest price seller? Enough said?
Patrick A. Heller was the American Numismatic Association 2012 Harry Forman Numismatic Dealer of the Year Award winner. He is the owner emeritus and communications officer of Liberty Coin Service in Lansing, Mich., and writes “Liberty’s Outlook,” a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at http://www.libertycoinservice.com. Other commentaries are available at Coin Week (http://www.coinweek.com). He also writes a bi-monthly column on collectibles for The Greater Lansing Business Monthly (http://www.lansingbusinessmonthly.com/articles/department-columns). His Numismatic Literary Guild award-winning radio show “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 a.m. Wednesday and Friday mornings on 1320-AM WILS in Lansing (which streams live and becomes part of the audio and text archives posted at http://www.1320wils.com).
More Collecting Resources
• Download The Metal Mania Seminar with David Harper to learn more about the metals market.
• Hunter? Naturalist? Purchase the 2014 World of Hunting – Red Deer silver coin to add a majestic coin to your collection.