The Year of the Rat
Volume 45, Number 2, February 2008
Just what is it worth? The Royal Mint has been the subject of numerous letters to the Editor in recent months in particular with regard to the 1953 “Coronation” set they are offering and also in regard to the possibility or perhaps hope, that they would stimulate collecting with a programme similar to the United States “States Quarters” that has proved so popular. On the face of it these two subjects appear unrelated the first a clamour by collectors and dealers that the Royal Mint was charging well over the odds for a product that could be bought more cheaply from elsewhere; the second a desire to have the Royal Mint help the hobby in this country with a dedicated coin programme aimed purely at encouraging new collectors. However the two topics aren’t as far removed as it may seem. The matter of the year set was dealt with fairly quickly it was, it appears, a mistake on the part of the Mint to suggest the coins were only VF, they are, we are told, “Proof”, and whilst any numismatist will tell you proof is not a grade per se we have been assured that all coins offered are of uncirculated quality. True, it seems that even for proof coins the price is on the high side and a number of dealers have pointed out to us that they can be bought cheaper from elsewhere. We were asked by one dealer why we didn t condemn the Mint's pricing policy (at least with regard to this set), after all wasn't selling coins like this bad for the hobby? Wouldn’t it simply put collectors off? Well, our response is a simple one we wouldn’t condemn anyone for charging what they want for their coins - it is a free market and we are not the people to police it. If one dealer wants to charge ten times what another does, and still manages to sell his wares, then who are we to say he is wrong? We publish the COIN YEARBOOK every year as our guide to British coin prices - this is what we believe the market price of a particular coin or set is, based on average values found in dealers’ lists and at auction; we keep it up to date with the pricing in COIN NEWS every month if dealers choose to sell outside that range then that is entirely up to them, not us. That said, yes, based on our own YEARBOOK figures we do agree that the Royal Mint’s price for this particular set is high and, yes, we are sure that these coins can be bought from other dealers for less money. But isn’t that missing the point? For many the Royal Mint doesn’t just sell coins it provides a total service which includes being part of the “Coin Club”. Members receive regular mailings, coins packaged and presented in a certain way, etc. and those collectors who buy from them (and there are thousands) are prepared to pay for that. To provide this service the Mint has all the overheads of any large company - the staff, the distribution system, advertising, design and packaging costs (the set in question is well presented, complete with historical information, etc.) and so on. Because of this they don’t try to compete on price with the smaller dealers who have none of the above expenses and to compare the two is misleading. The “ordinary dealers” (is there such a thing!?) are, of course, essential for the hobby, they are its lifeblood, but thanks to the amount of money, time and effort the Royal Mint spends on marketing,packaging, websites, advertising, etc., its reach is a long one and that’s vital too - which brings me neatly to the second topic that has featured in our post bag recently. The States quarters programme has been a great success in the US and something like it over here, or a “limited edition” release (which sees a very limited number of coins with a certain mintmark released along with the standard issue coins) would have people checking their change up and down the land and would increase the profile of our hobby no end. We would heartily encourage any such endeavour, in fact it is something we’ve been campaigning for over the years and know it would do great things for numismatics. But here’s the rub - it would have to be the Royal Mint who undertook such a programme - they are the only ones able give coin collecting that kind of boost. Yes, this is mainly down to their monopoly position as being the manufacturer of circulating British coins but it is also down to the fact they have a very powerful marketing department and a strong PR presence. It is these very things that make them different from the “ordinary dealer” and allows them to reach people far beyond the confines of the traditional hobby. Because of this they are in an excellent position to bring new people into the hobby. What good though, some may say, if the Mint, charging the prices they do, bring in new collectors only to have those collectors run a mile when they realise that the secondary market for such coins means they haven’t made the fortune they were hoping to and/or they realise they could have bought the coins cheaper elsewhere? A fair point, but ask yourself this - firstly the Mint don’t promote coins specifically for investment, so why people automatically assume they will increase in value is one of life’s mysteries; secondly the coins the Mint sell are all catalogued in price guides, both by us and others. Information on values is easily obtainable even via the Mint itself which sells our COIN YEARBOOK. If customers choose not to research the cost of their purchase before they buy, or if they choose to buy for investment and don’t actually check out whether this is feasible or not, isn’t that their choice? As I mentioned above, many of them do know the price of the coins they are buying but when necessary they are perhaps prepared to pay a little more for them in order to benefit from the service the Royal Mint provides. Sometimes the “value” of a product goes beyond what it is intrinsically worth.
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