Have You Thought of Becoming a Coin Dealer?|
February 01, 2012
Becoming a coin dealer is not something you pursue by taking a particular curriculum in school. On the staff of my companies we have employees with college majors of accounting, history, economics, natural resources and physical education. We also have senior employees who have not gained college degrees or even attended college.
With a net loss of over 2 million American jobs in the past three years, there are a lot of people who are open to new career possibilities. So, I’m sure that some coin collectors may have lost jobs and are seeking alternative careers. In the past three years I have received more contacts about possible employment than happened in my previous 28 years combined of owning a coin dealership.
Have you ever thought about the possibility of becoming a coin dealer? With rising gold and silver prices for more than the past decade, the coin dealer industry is mostly holding steady to thriving. If there was ever a right time to enter the business, now would be a good opportunity.
In my observations of the industry for more than three decades, I have seen two basic ways in which people try to make a career as a coin dealer. The most obvious one is a collector who has, at least in his or her own judgment, sufficient numismatic knowledge to make a living off of that know-how. This implies having learned how to detect counterfeit and altered coins, problem coins, and the ability to uncover hidden treasures in the inventories of other collectors or dealers. These hidden treasures can be found by 1) identifying varieties that the seller did not detect, 2) being able to pick out premium quality or even undergraded coins that can be acquired at prices reflecting a lower grade, or 3) having the numismatic foresight to enter a niche that is either undeveloped or in a market lull and being in “the right place at the right time” as that niche expands and prices rise.
The other means by which people try to make a career as a coin dealer is by operating a well-run business. Most coin dealers do not have the well-rounded combination of finance, accounting, marketing, management, and human resource skills to operate efficiently and to get the optimum return on the time and money invested. There have been a number of people who started companies on the business model of buying scrap jewelry from the public who then expanded into buying and selling bullion-priced and collector coins.
Sometimes an individual has the good fortune to be astute at numismatics and have strong business acumen. Such people can leverage these complementary skills to magnify the profitability of their dealings.
Many people work in the coin industry part-time, either as an enjoyable supplement to their regular jobs or as a means to possibly become a full-time dealer down the road. There are also a number of former full-time coin dealers who help out friends part-time because of the enjoyment and remuneration.
If you are thinking of possibly becoming a coin dealer, you have two routes to try. You could seek to work for an established company to gain experience in the industry. After a time, you might be able to buy out the owner, purchase another company, or you could go out to establish your own business. At least a half dozen past employees of my company now operate their own dealerships.
Alternatively, you could choose a market niche and become an immediate dealer with your own company. There are several operating venues open to you. The easiest to start would be selling numismatic items in internet auctions, procuring lots from any number of sources. You could take a table at weekend coin shows, which is possible for those who work full-time during the week. You could start up a mail-order business. All of these can be done part-time.
If you want to jump right in to opening a coin shop, then you need the commitment to hold regular hours for public access and will have to deal with a lot more government paperwork. Owning a coin shop makes more sense if you can deal in a broad range of numismatic merchandise, so that you can serve more customers. A coin dealer who buys and sells items within only a narrow range of numismatic niches would probably be best not doing so with a retail storefront.
What skills should a potential coin dealer possess or develop? Broad numismatic knowledge and better than average grading skills would be at the top of this list. However, there are many other skills that would be essential to be successful. Among these talents are mathematics, history, effective communication, and a consumer friendly attitude. Today, it is almost imperative to have at least basic computer operating skills. Having access to an extensive numismatic library and on-line services is also important. Almost equally important is the ability to negotiate effectively.
Many coin dealers began their careers working for other dealers (including family members) as a child. But there is no upper age limit. Last year one applicant to my company had worked for one large local company for 30 years, working his way up to credit manager. After his position was abolished and he was laid off, he still planned to work for six more years until his youngest child finished college. At the time he applied, he was working for a local franchise of a fast food restaurant for a wage not much over the minimum. Even though he wasn’t a serious coin collector, his work ethic, people skills, and a long, trusted career helping manage the finances of a large company merited serious consideration.
If you have ever thought about being a coin dealer, it is possible to test the waters without making a major commitment of time and resources. If it turns out not to suit you, you will have learned something and not hurt your finances much. Who knows, being a coin dealer could turn out to be a way to combine a long career and an enjoyable hobby. It has for thousands of people, including me.
Patrick A. Heller owns Liberty Coin Service and Premier Coins & Collectibles in Lansing, Michigan and writes Liberty’s Outlook, a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at www.libertycoinservice.com. Other commentaries are available at Coin Week (www.coinweek.com). He also writes a bi-monthly column on collectibles for The Greater Lansing Business Monthly (www.lansingbusinessmonthly.com/articles/department-columns). His 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 www.1320wils.com.
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On February 1, 2012 SHEEPLE
On February 1, 2012 Chuck Schroeder
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