CoinWeek: How to Deal Coins with Rob Oberth

[Music] Rob you may be one of the most talked-about coin dealers and the numismatic community in large part due to the pioneering work you're doing with the roundtables we've been getting coin dealers helping point dealers off the ground and really creating sort of a more grassroots nexus for dealers to communicate trade with each other and and since you are working in the ground at the basically at the retail level which is something that you know this hobby isn't doing as often as it used to I thought I would reach out to you and have you help us explain to collectors or people who may be interested in getting the business what those first steps are from being interested in points and turning into a career starting your own business and maybe becoming a coin dealer okay so I can only speak from my experience and my experience was organic as far as becoming a coin dealer so I would early on about 2006 or so I would go to estate sales and really buy whatever I can buy on the weekends to make money on and that could have been old toys militaria coins jewelry things like that I would fill up my SUV with whatever I can find that and I would bring it home and sell it on eBay and it really just evolved into coins because I had a love for coins and plus I appreciate it that they were small easy to ship liquid didn't take a whole lot of marketing to sell points because they are what they are for the most part but I would suggest to anybody don't get ahead of yourself that's key a lot of people think that when you that if you just got a storm and I just took out a loan and went and rented a store that's what I need to be successful I would say that you should be making that money first you should go out on the weekends don't quit your job be part-time stay best pocket until you look back one day like wow I'm making more on the weekends that I made have my at my weekly job which I did right and once that happens I would let a little time go by to make sure it was sustainable and then I was able to put my job but still even then I would still just do appointments the Estates they've been sale people would call me they would say hey I've got some coins or jewelry and I would go to appointment to meet them anywhere Starbucks banks wherever only when I was making enough money then to rent a shop did I rent a shop and it was a peanut I called the peanut shack it was a little shack right again I think incremental levels organic let the next step take you is something I always say don't force the next step it'll preserve itself when it happens well the other thing is is like when you're getting into the business that it really is a business you have to approach to this there's state violence recently sales certificates you need to have you sort of need to keep your accounting aboveboard I mean everything really has to be organized and worse until to successful business right so that's something you have to be familiar with with your local ordinances you have to know when exactly I want threshold you need to get a business license and with in my County that's $20,000 over 20,000 dollars and precious models of any time that's when you have to get a business license plus paid there's PayPal thresholds when they insert 1099 you have to be aware of that you have to be aware the Patriot Act and BSA laws that make sure you're compliant what's coming around the bend right now is the Wayfarer Act and I don't know if anybody in here has a point in the grasp of what that means but that is going to be a major burden Bobby on our profession so the Wayfarer Act in summary is a sort of a Supreme Court Supreme Court decision which is open the door for essentially an interstate tax on goods sold either online over the telephone through wire yeah fine any means yeah whatever if the product is traveling over state lines it's gonna be taxed and then they have to worry about exemptions in different states they have to worry about different cat like eBay was recently taxing Washington when they should not have been taxed in Washington and they came out and said that was a mistake so following those sorts of complicated laws is crucial that you have to stay on top of it you have to have a AML compliance plan by law you have to be registered in your state if there's sometimes there's whole laws you have to hold the merchandise for a certain period of time in my County it's 30 days you just have to be aware so let's up I mean obviously your path into the business might be different than people who may have collected points for a number of years and it you know many coin collectors see themselves as amateur dealers in the way they we only deal in trade but probably what's important for a collector like to do to adjust their mentality about the hobby when they go from buying coins for themselves to buying points that they intend to resale and hopefully make a profit so your question is what like what what's the shift and like mindset that goes in from being a collector to dealing influence I think that I think if you ask most collectors that they do consider themselves quasi dealers I think a dealer can be anybody that's buying and selling coins and intentionally you know making a profit when you do it initiatives we have a full-time dealer and they vest pocket dealer I think that's the fun of the of the hobby is buying and selling getting good deals making money when you can upgrade in your coins and the shift this shift would be when you go from a collector to a dealer you would be full-time buying and selling so what are the right prices that you should be looking at as a dealer I mean if you're obviously I think most dealers they have to make their money when they buy they have to buy right and a lot of collectors understand this because they have experience going to dealer maybe a coin that they bought for $1,000 or $600 or whatever and then the offer to buy back is typically not the same as what they paid unless the points gone up in value right so how do you as a dealer like gauge and understand the market and make sure that you're when you're purchasing material that there's enough room for you to to sell it at a profit and to cover expenses that come with your business not only you know your salary but the overhead the you know the rent everything that goes into it this is the payroll you made you made without me is this like the critical T that people have elements holy grass before they get into this business knowing your numbers and pulley grass before you get in maybe not but you do have to learn every day as far as finding the pricing for a coin you can use guides but you cannot use any of them singly by themselves you have to do research you have to look at auction records you have to look at great sheet any kind of cops you can find on a sole point but then you also have to know the coin they're not all the same so you can have a coin that's that could have a ten or twenty percent margin spread if it's either you know as a desirable look or it's kacct or it's just not a pretty coin there could be a huge spread ther see you really have to know your market you have to do your research so that's it can be tedious so what's the what's the typical goal for a dealer to turn or turn over their inventories there like a time frame is it better to sit on inventory that you can't sell for a long period of time and hopefully sell it for profit later or it's time money and you wanted to keep time and space is money and the more you handle something the more it costs so in the more the longer you sit on it the more cost so you want to turn items out and that's something I learned the hard way so I would you know I've always been a stacker in a collector so when I started 2006 I would I would be a traitor and sell enough to pay my bills and to make a profit to be able to pay myself and my employees but the rest would accumulate mm-hmm for one I didn't have time I was trying to grow my business so I wouldn't have time to sit down and suddenly honestly I'm still that way today main humilate or then I can sell because it comes in so fast so I would if I was going to do it all over again I would sell everything you know keep what you like maybe a market dollar said if you like it or keep upgrading your desired types at whatever you like but treat it as a commodity that you are trading it that's what I would do over at home some people may have the misconception that to become a point dealer you have to essentially be wealthy or have a lot of capital reserves when you start but but I think I'm often the not some of the stories I've heard from so the most successful dealers in our industry that's not that's not necessarily true do you think somebody just coming into the business with the willingness to learn and patience will be able to succeed even if they don't bring in you know a big pile of of capital to start with right patience is the key you can get pretty far most of the people I know like you say started from almost nothing I mean I would I would take extra money to the estate sales whether it's two hundred or five hundred thousand in that range and it was never more than that it accumulated and built up over time so yeah I would definitely definitely grow start small grow small don't borrow money don't ever borrow money unless you absolutely have very low interest because the interest a little tear you up for sure what's an example of the type a deal you should buy versus the type of deal you should pass on as a dealer if you're starting out I think it's what we're talking about I would start with lower numbers higher volume decent margins stay away from bullion in fact if you're going to diversify by rare coins by junk silver buy scrap gold buy diamonds and watches learn you know you can you can make good margins on that type of material versus buying bullion which ties up a lot of capital if there's a lot of market risk and it's just not worth it unless you have the funds and they're sitting there you want them to work that's when you can start dealing with bullying to make that two percent over on the quick flip it's just that's what a lot of people do they tie up a lot of their capital and stuff that they really shouldn't be tired what if it's a winner what if it appears to be a good deal but you're definitely stretching your resources to buy it if you're just starting out is that the kind of thing you should pass on only if it's liquid only in with the communication the way it is today with social media with cell phones if you see an item in a showcase and it's $10,000 and that's all you have you better know you can walk three tables over and sell it for $11,000 unless there's a decent margin built in so I would say don't tie your money up always always stay liquid and turnover quickly and it also as a starting dealer it's probably very important to become part of the dealer community to make friends give people who can help mentor you through and to join you know an organization like yours that will help you not only achieve the ability to liquidate coins as they come through the door or when you have access to them but to give you insights from people who may have more expertise in a particular area another lesson I learned the hard way the very hard way again I started in 2006 and I would shop coin dealer so everything would come in over the counter and I would either sell it on eBay or at the shop this went on all the way up until I started the group in 2017 early 2017 never setup at a show never really connected locally with my dealers and there's some really good dealers in my area I could have connected with and learned from I did not realize the value of that and I if I was to do that again I would network with dealers because you can learn so much my mindset back in the day was why leave anything on the table why not just sell it at retail and you know you're young and you're hungry and you want to make as much as you can so you sell it retail I missed out on a lot of knowledge by doing I could have learned an intense amount of knowledge networking with local or and now even better so online social media you can learn you can learn along so you know the industry's all it seems like it's always in flux you know with people coming and going and you know the hobby for the for the most part when you come to a show like that is a little rare I think online is probably where most of the younger collectors and buyers are but are we in a position in the hobby where we still need more dealers to come into the market I think we do and I might be in the minority I'm thinking that way I would like to see more dealers in the industry I would like to see other professions get into coins because my thinking is that if we had more dealers they would make more collectors they would absorb more of the material we're about to get hit with an onslaught of just tons of material coming from people the state's essentially hitting the market with nobody to absorb them as a coin dealer I know and a lot of people around here will tell you that we accumulate inventory we take it off of the market and we try to find buyers if we don't have people to do that we're in big trouble like disaster right so yeah I would I would definitely encourage more dealers into the market that get jewelers to start dealing with when you're absolutely right dealers create collectors I think so and we definitely thanks Rob appreciate it thanks for your time

Channel: coinweek

Views: 9,112

Rating: 4.8974357 out of 5

Keywords: Rob Oberth, Coin Dealers Helping Coin Dealers, Coin Collecting, Numismatics

Id: vF8IeYjX3FE

Length: 15min 13sec (913 seconds)

Published: Tue Feb 12 2019