By Louis Golino for CoinWeek …………
West Point set delays
A large number of purchasers of the 2013-W West Point silver eagle sets have been frustrated by ongoing delays in the shipment of their orders. Although they found out as soon as their orders were placed that the sets would not ship right away, many buyers are still waiting for their sets to ship two months after sales ended. And their expected shipment dates have not only been repeatedly pushed back. They have also jumped around several times, and in some cases orders placed later during the 30-day window have shipped earlier than orders placed on the first day.
Adding to the frustration is the perception some buyers have that large coin dealers have been given preferential treatment in the processing of their orders and that first in, first out order fulfillment is not being followed. I first discussed this in an earlier column.
It is further alleged by some people that this was done so the dealers could get their coins graded and on the market quickly and so that they would be first strike and early release eligible.
From what I have been able to determine, the evidence simply does not support these views, especially the implication of some kind of collaboration between the Mint, dealers, and grading companies. Some dealers did manage to get their sets graded and on the market very quickly, but lots of others have faced the same delays as individual collectors. Furthermore, I placed an order during the first hour of sales on May 9 that shipped June 28, which is faster than my experience a year ago with the 2012-S San Francisco sets.
So the real issue is what are the underlying reasons for the continuing shipping delays, especially given that this is the second time the Mint has used the 30-day sales window and the mint to demand approach?
I contacted the Mint and received the following response, which explains that it is the packaging rather than the coins that have been causing the shipping delays:
“The coins for the sets have been struck. However, the packaging for this product is manufactured overseas and takes several weeks to be made and shipped to the United States. As is our standard practice, the United States Mint ordered a certain quantity of packaging up front. This initial order of packaging material represented more than 60 percent of the final net demand for this set. We had to wait until the ordering window closed before we could further determine our needs and place the final packaging order. The packaging is arriving in various quantities at various times. Each time a shipment arrives, the United States Mint at West Point quickly packages the sets and sends them to our fulfillment center where they are then delivered to our customers. Customers are not charged until their orders are shipped.”
“Finally, we made every effort to ensure customers were fully aware of the potential delayed shipping dates at the time they placed their order. This was accomplished by posting and updating the expected shipping dates on the website at the time of purchase.”
It is helpful to have the Mint’s perspective on this issue, but two points come to mind.
- First, the 2013 sets use the same boxes as the 2012 sets, and only the outer sleeve had to be made so it would show the name of this year’s sets.
- Second, last year’s large number of order cancellations for the San Francisco set should have freed up tens of thousands of boxes that could be used for the 2013 sets, especially since most of the cancellations appear to have been made towards the end of the shipment fulfillment process.
In addition, I am surprised the Congress does not require that all packaging for U.S. Mint coins be made in America, although that would probably raise costs.
Another episode that irritated many collectors is the computer glitch that took place on July 30 that inadvertently reopened the sales window for these sets for a few hours. The small number of orders placed that day was quickly cancelled by the Mint.
The "mint to demand" approach clearly still has some kinks that will need to be worked out. I think that in the future the Mint should continue to expect most orders to be placed during the first hours and days of sales and should try to better prepare for that. Too much use of the "mint to demand" approach is going to continue to turn off a lot of collectors, who want to be able to buy something that is relatively scarce, as long as they have a fair chance at ordering.
Like many collectors I would prefer to see a return to more products with limited mintages, as other world mints do things, but with some household limits and some new ideas on how to enforce those limits.
Already the mint to demand approach coupled with the shipping delays, which has resulted in too many sets hitting the market at once, is resulting in lower secondary market premiums for both raw and graded sets. 70-graded sets from NGC and PCGS are declining in price as more reach the market. Raw sets are doing better than last year’s two-coin eagle sets, but rarely sell for more than about 50% over the $140 issue price, even in sealed, first strike/early release-eligible boxes. Compare that to raw 2011 25th anniversary sets, which still sell for more than twice issue price.
I suspect that over the long term these sets will do fine, especially if the enhanced uncirculated eagle does not become an annual issue. Plus there are rumors that a lot of people cancelled their West Point sets due to their irritation at the shipping delays. This could result in an adjusted sales number well under the 281,310 sets the Mint said it sold when the window closed, which is precisely what happened last year.
On August 8 the Mint will begin accepting orders for what is probably the most widely anticipated U.S. Mint gold coin since the 2009 Ultra High Relief Double Eagle, namely, the 2013-W Buffalo reverse proof gold coin. This coin will also be minted to demand and available for sale for 30-days. Hopefully the Mint has plenty of coins and packaging ready to go for this item. Because of the much higher price point there will not be anywhere near as many orders for the reverse proof coin as there were for the West Point sets, especially given the short sales window.
But gold has been down recently, and on August 7 the Mint lowered prices for its gold coins by $50 per ounce and established the initial price for the reverse proof, which is $1640. That price and the overall allure of the coin is likely to result in a flurry of sales, especially during the first couple of days, as buyers and dealers try to get coins that are eligible for first strike and early release labels. However, many other buyers will prefer to keep the coin in its original packaging.
In this case waiting a little while to receive your coins may be a blessing in disguise, as orders will not be charged until they ship, but the price is locked in at the time of sale.
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.