by Louis Golino for CoinWeek.....
John Feigenbaum is president of David Lawrence Rare Coins (www.davidlawrence.com), a retail and auction rare coin company founded in 1979. Mr. Feigenbaum is the author of books on Washington quarters and one on Barber coinage, written with his father, David Lawrence.The company holds online auctions on Mondays and Thursdays.
This week they announced that they are dropping buyers’ fees for auctions at a time when other auction houses have been increasing fees charged to buyers. Among the larger auction companies, some do not charge sellers' fees, or not above a certain amount, but most except e-Bay do charge buyers’ fees.
I recently interviewed Mr. Feigenbaum about the no buyers’ fee announcement.
1.) Can you tell CoinWeek readers what drove you to drop buyers' fees for your auctions? Did the recent moves to increase fees at companies like Stack's-Bowers play a role?
We had been considering a move to lower out auction rates in the past year or so. When I saw the major auction companies raise their rates to 17.5% I knew immediately that this was time to make that move, and take our fees in the opposite direction. We first contemplated 10%, but then we had a crazy idea… Why not make it 0?
Everyone knows a company has to make a profit but a "buyer's fee" now feels like an unnecessary tax to me; it almost seems anachronistic in this day and age of the internet.
We've been selling coins for over 32 years and I like the idea of being out front with positive (industry) change. I hope others will follow…It's better for the buyer. And what's better for buyers is ultimately better for sellers, and the marketplace as a whole.
Also, I don't think people have an easy time figuring out how to calculate an accurate bid with a 17.5% commission. How do you do that? I worry that bidders will round it to 20% in their heads and bid less…which can drive prices down, thus hurting consignors.
2.) Will there be any changes to your other auction terms as a result of this?
None other than the elimination of buyer's fees. We already offer free shipping and allow credit card payments up to $10,000.
3.) For example, will seller fees be affected?
We will derive our revenues from our standard commission structure of 10-15% per lot. This makes it much easier for buyers and sellers to do the math and understand exactly how much they are paying and will receive. Also, we never change buyback fees.
We offer the same deals for all of our consignments. We feel that we have the best offering out there because, unlike other auction houses, when your coin(s) fail to sell in auction, we immediately offer them for direct sale on our web site, and other channels like eBay. You get three selling venues for your coins. Nobody else does that.
4.) How do you see the coin auction platform evolving in the future?
I think that technology will continue to improve the experience in many ways. I think it's a better discussion for another article, but simply put, I feel that auction is a very important part of coin trading — but not the end-all. We still sell many coins by private treaty. It just depends on customer preference. Some folks like the action of bidding and others can't be bothered — they just want to make a quick transaction without risking losing the item. As a seller of coins to collectors, we try our very best to design a platform that accommodates everyone.
5.) Since you are someone who has a lot of experience dealing with rare coins, what is your brief assessment of the state of the coin market?
The coin market is a little soft right now but still robust. We've managed to stay active by cutting our margins and being creative. I think the 0% buyer's fees is just one more step to stay one step ahead. I also foresee the market being on the soft side until the general economy gets sturdy again, and/or bullion prices pop up. Either would be great for us.
The good news is that this is a great time to buy at the moment. Despite what I've been reading in some blogs and articles, I am finding great inventory right now at very attractive prices — and collectors are benefitting from these opportunities. Better now than after prices rise again.
Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. His column for CoinWeek, “The Coin Analyst,” covers U.S. and world coins and precious metals. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.