Stamps
for Dummies Stamp Catalogue Prices So useful..
Hardly a stamp collector, dealer, or auctioneer in
the world can
go far in their pursuits without coming across and
using catalogue
prices.
Collectors quote them at each other. Dealers use
them in price lists.
Auctioneers
use them as part of their auction lot descriptions.
However, few
collectors
could truly explain what "catalogue price" actually
means.
DEFINITION
One Saturday I did a very rough calculation based on all stamps sold in our shop during the course of a fairly typical day. As each customer left, I noted the price they had paid for stamps, and estimated the catalogue price of the items they had bought. Over the whole day, it worked out that we had sold stamps at approximately 10% of the catalogue price. However, this included a couple of items for which we had charged virtually the full quoted price, and others which had been sold at less than 1%. One of the useful aspects of doing business in a retail shop is that it is very easy to demonstrate to visitors how much market prices vary in comparison to catalogue prices. |
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FAQ
Why do some stamps
cost such
a high percentage to buy, yet fetch
such a small price when I try to sell ? The most
likely
reason for this would be the uncertainties of supply and demand.
If a
dealer is offered a scarce stamp with a high catalogue price,
but is
not aware of ever having been asked for such a thing, and can't
think
of any customer who might buy it, it would be unreasonable to
expect
that dealer to pay much for it; he might take months or years to
sell
it, or in fact has the risk of never selling it at all. Would
he be willing to buy an item, hold it in stock for perhaps
several
months and then make only a small percentage mark-up on it
?
Generally, a low supply/low demand stamp will have a large
margin
between buying and selling prices; if the dealer sells it
quickly, he's
scored, but he has to factor in the possibility of a very slow
sale.
Prices are always based on the balance between supply and
demand, but
high supply with high demand, or low supply with low demand, can
often
come up with the same price.
Prices in auction for some material can also be fickle.
High-throughput, standard popular material will not vary too
much in
price. If it goes a bit low, many people will be willing to bid
for it.
But if it goes a bit high, everybody knows that they can skip
this
opportunity, as they will surely get another chance quite soon.
A very unusual yet esoteric item turning up in an auction
however could
easily go very high or very low. If there are only two people
who might
want it, the price could still be high, as both know they might
never
get another chance. Yet the same item turning up with only one
serious
bidder will probably be cheap.
Catalogue publishers have to take all these factors into account
when
deciding prices, and it is clearly not always an easy job.
Cost of handling is another
factor.
If a stamp is catalogued at 25p, and a dealer has stocks
organised by
country and date, they might easily charge 15p or 20p for it.
But the
initial sorting of the stamp, correct filing, and then the
serving of
the customer, might eat up 10p to 20p in time and costs, so the
average
dealer needs to buy such items for next to nothing in order to
make any
profit. The handling costs are virtually the same on a stamp
priced at
50p, or £1, or £20, so the profit margins can be
much
smaller. So, generally, very cheap stamps might cost a high
percentage
of catalogue, but can be resold for only a very small
percentage.
When buying and selling through auction, the selling price as a
catalogue percentage should, you would think, be the same, the
only
difference between one side and the other being the auctioneers
charges.
How much difference
can
condition
make to a stamp ?
The condition of a philatelic item is crucial. A stamp in a
lower
quality will always sell for a lower price. Generally,
commoner/cheaper
stamps with faults can be written off as having no value. Why
would any
collector pay for an item in poor condition, where a nice
example can
be had for a very low price ? Scarcer stamps can often be
sold
even if faulty, but the damage will reduce the price - maybe
just by
20% or 30%, or maybe by as much as 98% or 99%. All faults will
have an
effect; tears, thins, creases, stains, short or damaged
perforations,
cuts, pinholes, scratches, and so on.
But remember this; some of the most valuable stamps in the world
are
damaged, and yet get tens of thousands of pounds or more - while
the
very cheapest stamps, even in A1 quality are worth next to
nothing.
Condition is a very important factor, but not everything hangs
on it.
Can I use a formula
to
calculate the value of my stamp collection ?
No.
Whatever formula you can come up with, even though it might be
right in
one instance, can be shown to be wrong with many other examples.
If
ever another collector tells you their method of calculation,
ignore
it. Professional philatelists, when carrying out valuations
(whether
for market values, insurance values, or whatever reason), never
use a
standard formula.
So what use are
catalogue prices ?
They set a point from which discussions can follow. They usually
get
things right when making simple comparisons to show what is
common and
what is scarce.
Quality
"It doesn't refer to what
people
have got. It relates to what they want !"
x
.
TO BE
CONTINUED
.......
Robert
Murray Stamp Shop 5 & 6 Inverleith Gardens Edinburgh Scotland EH3 5PU Tel. 0131 552 1220 Fax. 0131 478 7021 Homepage; www.stamp-shop.com Email; [email protected] |
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Our
Shop is open five days each week, and customers are always, of course, welcome. We carry very wide stocks of the whole world - much, much more than is listed on our website. Full shop information at this link. |
Last updated Sunday 22 October 2006. Copyright Robert Murray
2006.