5 Tips for the Next Generation of Coin Dealers

The coin industry is changing in dramatic ways. With a wave of retirements from big-name dealers forthcoming and the arrival of a new generation of tech-savvy coin dealers on the horizon, the contours of the 21st-century coin market are now taking shape.

Five Tips for Up-and-Coming Coin Dealers …..

The coin industry is changing in dramatic ways. With a wave of retirements from big-name dealers forthcoming and the arrival of a new generation of tech-savvy coin dealers on the horizon, the contours of the 21st-century coin market are now taking shape. I lived through the third-party grading revolution as a young collector, and I’ve covered the past 15 years of developments as a professional. At no point in my career have I anticipated a period of so much change. I am excited by the potential that emerging dealers–many in their early 20s–have for molding the industry and bringing excitement and innovation – two things the coin hobby truly needs.

In this article, I’d like to offer these future leaders five tips to help them establish their brand identity and avoid mistakes that could cost them years to recover from.

If any prove helpful, please drop me a line.

Over-Reliance on Grades and Pop Reports Is a Bad Idea

Unfortunately, understanding the rare coin market is not as simple as looking at a pop report, skimming over recent auction results, and arriving at a conclusion. This data is helpful, of course, but it paints an incomplete picture. It’s better to view this information as a snapshot of a point in time and to compare the current pop and market data to historical data.

Major auction sites with sales archives can be particularly useful when trying to piece together a more complete picture of the market. Questions I seek to answer include: How have the pops changed over time? Are there auction appearances of the top-pop coins in other holders or other grades? Are these coins typically sold in “named” auctions or do they kick around from time to time, having multiple auction appearances within a short span of time? How do specific coins at the top end compare to other known top-end coins? Is it possible to rank the condition-census coins from best to worst based on eye appeal and market data?

Another question that can’t be answered directly by looking at grades and pop reports is how popular that date and series is at any given time. This is judgment that must be developed for you to compete in the marketplace – not just for coins, but for customers.

Start as a Generalist With a Strong Customer Focus

Most successful dealers specialize but determining which specialty to pursue requires time, experience, capital reserves, and a customer list. Dealers just starting may be lacking in one or more of these areas and need time to develop not only the knowledge necessary to specialize but also the connections necessary to emerge as a market leader in a given area. For this reason, it is better to be a generalist when you are starting out, dealing in areas where your knowledge is developing and where you can make safe plays as you build up your brand and reputation.

One young coin dealer that I have had several excellent interactions with (a current ANA Board member, if you want to figure out who) impressed me with his strong customer focus, and I think you can benefit from knowing what it is he does and the impact it has on a customer.

I purchased a small number of older numismatic books and catalogs from this dealer on eBay. When the books arrived, they were smartly packaged, in the stated condition, and delivered promptly. It’s the little bit extra that impressed me, however. Inside the package, this dealer bundled a wooden nickel, a business card, a card promoting membership in the American Numismatic Association, and a brief message to let me know that he will happily work with me to help me find what I’m looking for. This approach may not yield immediate results, but it makes a firm impression and speaks highly of the individual and the brand that they are building.

That’s not to say that you should pester your customers or over offer, but building a two-way street allows traffic to flow both ways – your customers will sell you deals and look to you to find them coins.

Another aspect of being customer-focused is knowing when to give your customers a win. I define a “win” as a transaction where the customer feels like they’ve gotten a fair deal. Notice I said fair deal, not a good deal. Dealers do not have to give away coins for the sake of good customer service; collectors understand this. But what collectors don’t like is when a dealer prices the coin so aggressively that there are no leaves left on the tree. This is why so many collectors are skeptical of dealers who are known to frequently crack out coins and upgrade them.

Don’t Give Away Coins You Believe In

Nice coins tend to disappear in cold markets and reappear when the time is right to yield a maximum return. Dealers starting out might not have the luxury of saving nice material for the right opportunity and may see the sale of these coins as a way to make up for bad purchases or to maintain sufficient operating capital.

In a business where turning over inventory multiple