Conversation with a dealer...

[shadroch]

While I'm sure every LCS owner would love to have a wall of fame, museum quality display,the simple matter is that few shops have excess space to devote to non-income producing material. If a portion of your shop isn't producing,the rest of the store needs to produce even more.

[drbanner]

CGC fans remain an extreme minority in the collecting community.

 

Hmmm...go to any big comic book convention and talk to the dealers and collectors that buy and sell comic books worth over $100 and I think you'll find a different perspective (and it's not just limited to high grade).

 

How many folks buy comics worth over $100 as a percentage of the total collecting community?

 

Plenty enough that CGC fans are much more than "...an extreme minority in the collecting community." I used $100 as the point where CGC really plays into the market, but CGC books sell from $1 to hundreds of thousands of dollars. Platinum, gold, silver, bronze, and modern books are all available slabbed. Wizard, Overstreet, CBG, and all the institutions that help support and promote the "collecting community" feature CGC articles and whatnot. CGC plays a prominent role in the back issue market, even though the number of slabbed book sales is a small percentage of overall back issue sales...

[deathlok]

While I'm sure every LCS owner would love to have a wall of fame, museum quality display,the simple matter is that few shops have excess space to devote to non-income producing material. If a portion of your shop isn't producing,the rest of the store needs to produce even more.

While I can't speak for your LCS, every one I have seen in my neck of the woods (see above for at least 12) has a display area. In which they have artwork, statues, comics, t-shirts, etc.) Wall space is not sales space, normally used for people to look at. The bins or racks are where people normally do their buying.

 

When I travel around the country I seek out comic shops whereever I am staying. Within several minutes based upon the look of the shop I can tell if I would buy from them and what condition the books will be. All this based upon what books they have on display and how they are displayed.

 

From a simple business model, a clean and friendly well-stocked store will normally attract business. It's amazing how many shops are dingy and dirty looking inside, regardless of what books they have on display.

[jimm94]

Hi Zanarkand,

 

While it's true that dealers who accept CGC submissions from customers make money selling that service (and negotiate discounts with CGC based on quantity of submissions), your statement that "The only reason anyone's heard of slabbing at all is because of the number of national dealers who push the service because they get paid to. Plain and simple." is an opinion, not fact. To add my own thoughts on this, CGC's presence in the hobby is well established to the point that almost any comic fan who reads Wizard, CBG, or visits prominent industry news web sites should at least have a basic awareness of what the service is, even if they don't understand what's cool about it. You'd have to be a pretty oblivious comic reader to have never even heard of them. Maybe I'm overestimating the awareness level of the average collector?

 

However, I would certainly agree that collectors and dealers who use their service are in the minority at this time. I would also agree that some collectors and shops probably don't need CGC. The LCS where I buy moderns is a perfect example. There isn't a single book in the entire store priced at over $10.00, and most of their customers are not gold, silver or bronze age junkies. If they are, they get their fix elsewhere like I do.

 

The only two reasons to not like CGC are FEAR and IGNORANCE, and neither one of them is a good reason if you ask me.

 

Regards,

 

-Jim

[blutobc]

I've only found two local comic shops that had anything to do with CGC and they both were speculating with moderns slabs.

 

One store went bankrupt with cash flow problems(they did have some fairly nice 9.8s), and I don't know how the other one stays in business. They've sent in their own bronze backstock and usually received back 9.0s and try to brag about them...and I'm talking about non-keys. The rest of their back issues are in even worse shape.

[DoubleCovaBrotha]

I can understand a dealer who may not want to submit books to CGC. I buy CGC books for two particular reasons. The first is the restoration service provided by submitting a book. The second is to guarantee some consistency with grading when I deal with sellers online. I have a general idea of what a CGC 8.0 book looks like. I don't have to argue with the seller when I receive the book that he actually overgraded. However, this point is moot when dealing in person. When I step into my LCS to purchase books, I can carefully examine the book to see if the price is consistent with the book of this grade. There's no uncertainty with the grade as it is what I determined. The grade I give the book is much more valuable to me than what CGC gives.

 

Also...I noticed that most dealers have the attitude of, "I've been in the comic book business for 20-30 years...I don't need someone else telling me what grade my books are." Whether or not this is true really depends on the skills of that particular dealer.

[FlyingDonut]

I think everybody is missing a key point. For 99% of comic shops, the key is inventory turn and maximizing profit on their purchases. I broker for several stores, and the one closest to me has books walk in all the time, and they are paying literally pennies on the dollar. These books are NOT high grade, except for 80s box filler, but everything moves. Getting books slabbed, from a store owners perspective, ties up capital, keeps books from turning (for at least the three months the book is in Sarasota) and prevents them from having "candy" in the store.

 

Here's a good example. What's a better use of my LCS' time and money - me selling a VG+ copy of Amazing Spider-Man 129 for $130, with the store realizing approximately $85 in profit on the book in a week, or the book getting slabbed and their cash being tied up for months?

 

Or, in Chicago I'm bringing ten very high grade copies of X-Men 266 to get slabbed. The LCS and I have discussed this, and if the book comes back 9.4, it simply isn't worth getting done, because it will sell for $40. My cut would be $10, grading is $20, the fees would be $3 and the paypal hit would be $2. They can make more than $5 simply by putting the book up on the wall at $25. (Clearly, we're hoping for some higher grades! ).

 

Again, remember that 99% of the marketplace is NOT slabs. That's the key equation in the whole discussion.

[deathlok]

I think everybody is missing a key point. For 99% of comic shops, the key is inventory turn and maximizing profit on their purchases. I broker for several stores, and the one closest to me has books walk in all the time, and they are paying literally pennies on the dollar. These books are NOT high grade, except for 80s box filler, but everything moves. Getting books slabbed, from a store owners perspective, ties up capital, keeps books from turning (for at least the three months the book is in Sarasota) and prevents them from having "candy" in the store.

 

Here's a good example. What's a better use of my LCS' time and money - me selling a VG+ copy of Amazing Spider-Man 129 for $130, with the store realizing approximately $85 in profit on the book in a week, or the book getting slabbed and their cash being tied up for months?

 

Or, in Chicago I'm bringing ten very high grade copies of X-Men 266 to get slabbed. The LCS and I have discussed this, and if the book comes back 9.4, it simply isn't worth getting done, because it will sell for $40. My cut would be $10, grading is $20, the fees would be $3 and the paypal hit would be $2. They can make more than $5 simply by putting the book up on the wall at $25. (Clearly, we're hoping for some higher grades! ).

 

Again, remember that 99% of the marketplace is NOT slabs. That's the key equation in the whole discussion.

 

FD in your examples it would be stupid for an owner to send his books. Nobody is arguing that LCS send most of their stock into Sarasota for grading. The only candidates that should be books that are HG or major key issues. If one of your owners has a NM- FF#48, is he just going to keep it in the long box for guide?

[DoubleCovaBrotha]

FD in your examples it would be stupid for an owner to send his books. Nobody is arguing that LCS send most of their stock into Sarasota for grading. The only candidates that should be books that are HG or major key issues. If one of your owners has a NM- FF#48, is he just going to keep it in the long box for guide?

 

If the dealer is smart, then he'll put it up for slightly below market value, regardless of whether or not it is slabbed. Eventually, a buyer will realize that the book is obviously a very high grade gem and knows that it is a bargain. Remember that the dealer gets to set whatever price he wants.

 

Submitting to CGC is considered to be a gamble for many people. When dealing with a book like that, why bother taking a chance? Unless you're hard up for money, just wait it out with a price sticker that you are satisfied with.

[OldGuy]

let's say that a newbie has an epiphany and does buy a slab. What does he do with it now? Having slabs can be a pain in the [!@#%^&^]. He can't read it.

 

He can't? I read CGC graded books all the time.

[Larryw7]

Here in Philly, Fat Jack's basically only sells raw books and have sort of abandoned both customer service (if you ever want to meet the least friendly staff in America, drop by Philly sometime) and any notion that back issues are important to them -- even though they have a ton of them.

 

Sorta OT, but what kind of a selection of back issues does Fat Jack's have these days? I haven't been able to get into CC Philly for awhile. My local shop in the Far N.E. is Comic Collection; a nice guy runs the place, but prices are way too high.

[Rival61-migration]

Obviously CGC books represent a miniscule percentage of back-issues out there. If the majority were slabbed, CGC would be a larger company than Micro$oft. So one should assume that a LCS should not allocate a large amount of capital or space to try and move them.

 

But the same can be said for an LCS with a large selection of high-grade golden age. How often will you sell (assuming you have one) that Action #1 for $250,000? Most people are just not in the market for such an item. But the general rule is, "You cannot sell what you do not own". If you stock high grade Golden age stuff, you will soon be known for it, and attract that business. If you stock CGC, you should become known to people who seek them. You just have to know what part of the business you are seeking to pander to.

 

Lastly, CGC slabed issues on display can actually have a very positive effect on the hobby in general. Just as displayed silver age issues of ASM inform newer members of the hobby that there is more to spiderman than "ultimate", CGC books can show taking care of your collection can reward you years down the road. Most collectors quickly learn that a better condition issue is more desireable, and so more valuable. The CGC certification is the natural extention of that philosophy, taken to it's last and final conclusion. A work of art, a piece of history, stored and registered, to be admired by future generations. This is certainly worth a premium for my collection.

 

-Rival

 

-Rival

[Aces]

For example, what would you think if you went into an LCS and saw that they had on their wall the following slabbed books.

 

Fantastic Four #11 CGC 6.5

 

I would think:

 

"How much!?"

[shadroch]

Using numbers supplied by this months CBG,CGC has slabbed a total of 395,360 books,as of last March. As the grade that is hit the most is 9.6(just under 20%),I'm guessing the majority of slabbed books are moderns.Again,using CBGs numbers,almost 60% of slabbed books are 9.2 or better with the median grade being 9.4

Thats roughly the equilivent of the amount of books displayed at any major convention.Or about a third the number of books many major dealers claim to have in stock. I know 400,000 books would take up a small space in Gary Dolgoffs warehouse.I believe Lighthouse posted that he had aquirred a larger number of books in one deal.

If each of Diamonds roughly 4,000 accounts were to try to stock 100 CGC books each,there wouldn't be enough to go around.

That gives a rough idea of the size of the CGC market penetration. Now,their influence in the marketplace is an entirely different story. One that can't be easily quantified.

[Zanarkand]

While it's true that dealers who accept CGC submissions from customers make money selling that service (and negotiate discounts with CGC based on quantity of submissions), your statement that "The only reason anyone's heard of slabbing at all is because of the number of national dealers who push the service because they get paid to. Plain and simple." is an opinion, not fact.

 

Well, no, that's what CGC is. They're not a company that with the cooperation of dealers likes to grade comics, they're a consortium OF dealers. A member of the LLC doesn't just get discounts on submissions, they directly profit from the company. That's the nature of an LLC.

 

Look at a list of CGC's charter members. I don't know them all, but I do know that these guys are members: Metropolis, Mile High, Superworld, PCG Mint, Graham Crackers, PCE, Redbeard's, Motor City, Bob Storms of highgradecomics.com, Marnin Rosenberg of comiccollectors.net, ComicLink, Classic Comic Investments, etc.

 

And the list goes on. This is the crew that banded together and formed CGC in the first place. It's their company. They all make money by promoting CGC, and the only reason CGC exists is so these guys can make money. And not just because CGCd books often sell for more than raw, that's just icing on the cake. Members of an LLC share the company's profit, too. I'm not saying there's anything wrong with that, that's just how an LLC is organized.

 

Big national dealers, who already had large market presences, pushed CGC like mad because they made money doing so. This gave CGC a large market presence. Pretty soon people starting asking "What's this CGC thing"? Ergo, people only heard of CGC because big dealers, who were getting paid to do it, introduced them.

 

The only two reasons to not like CGC are FEAR and IGNORANCE, and neither one of them is a good reason if you ask me.

 

I would not characterize any collector, dealer, or LCS owner I know as either afraid or ignorant of CGC. They are aware of the service (as you pointed out, how could one not be?), and in the case of the dealers, are aware that CGC'd books tend to sell for more than non-CGC'd books. They just don't care. Collectors don't watn to spend any of their finite collecting budget on slab fees, and the dealers don't want to tie up the capital (member dealers don't tie up capital by the way, which is why it's easy for them to submit. Remember, they profit share from the company).

[jduran1]

This answer sums it up Of course I have no input on the thread since I am not allowed to step foot in my LCS. But back in the good old days when I could visit my LCS it was a very depressing experience.

 

They hate CGC

Their grading is a joke 7.5's are really 9.2's per their grading standards.

"What do you know JD about grading you are only a customer."

Most of the shop employees are former hells angels.

The smell of incense is so thick you can hardly breath.

"Sorry no restrooms"

"Jesus Christ I will show you that book on the wall again but didn't you look at that last week" ($500 book no less)

"Please do not read the comics""

"Sorry the superman 1 comic you want to sell us is in horrible shape so I can only give you 75 dollars for it. " " But sir it has never been read" "well no one is buying old superman comics anyway since they are a bad investment"

Do you have any high grrade Hulk 181's ? "Are you crazy any NM books that come into my shop are put in the owner's private collection and not offered for sale. Well what about the NM books you have on the wall? Well JD between you and me (I only work here) the owner puts his VF books for sale as NM but I think you and I know they are overgraded"

 

Thank you have a nice day.

[Foolkiller]

zanark:

 

I'm a little confused by what you're claiming... the charter members are part of the LLC?

 

That's not my understanding at all.

 

I don't think there's any direct profit sharing with the dealers you've cited. I agree they all had input into the formation of CGC and what it should and might deal with... but I'm not sure I completely understand your post.

[sborock]

While it's true that dealers who accept CGC submissions from customers make money selling that service (and negotiate discounts with CGC based on quantity of submissions), your statement that "The only reason anyone's heard of slabbing at all is because of the number of national dealers who push the service because they get paid to. Plain and simple." is an opinion, not fact.

 

Well, no, that's what CGC is. They're not a company that with the cooperation of dealers likes to grade comics, they're a consortium OF dealers. A member of the LLC doesn't just get discounts on submissions, they directly profit from the company. That's the nature of an LLC.

 

Look at a list of CGC's charter members. I don't know them all, but I do know that these guys are members: Metropolis, Mile High, Superworld, PCG Mint, Graham Crackers, PCE, Redbeard's, Motor City, Bob Storms of highgradecomics.com, Marnin Rosenberg of comiccollectors.net, ComicLink, Classic Comic Investments, etc.

 

And the list goes on. This is the crew that banded together and formed CGC in the first place. It's their company. They all make money by promoting CGC, and the only reason CGC exists is so these guys can make money. And not just because CGCd books often sell for more than raw, that's just icing on the cake. Members of an LLC share the company's profit, too. I'm not saying there's anything wrong with that, that's just how an LLC is organized.

 

Big national dealers, who already had large market presences, pushed CGC like mad because they made money doing so. This gave CGC a large market presence. Pretty soon people starting asking "What's this CGC thing"? Ergo, people only heard of CGC because big dealers, who were getting paid to do it, introduced them.

 

The only two reasons to not like CGC are FEAR and IGNORANCE, and neither one of them is a good reason if you ask me.

 

I would not characterize any collector, dealer, or LCS owner I know as either afraid or ignorant of CGC. They are aware of the service (as you pointed out, how could one not be?), and in the case of the dealers, are aware that CGC'd books tend to sell for more than non-CGC'd books. They just don't care. Collectors don't watn to spend any of their finite collecting budget on slab fees, and the dealers don't want to tie up the capital (member dealers don't tie up capital by the way, which is why it's easy for them to submit. Remember, they profit share from the company).

 

I do not know where you got you information, or should I say MIS-INFORMATION from, but whoever you have been talking to is either a very paranoid person or has an ax to grind with CGC. Their is NO consortium of dealers, there is NO profit sharing with dealers, there is NO shadow cabinet, there is NO area 51and there is NO grassy knoll

 

The only thing the dealer's get from us is a 20% discount on their submissions and some of those people pass the entire discount along to their customers.

 

Here is some

 

DEALERS USE CGC TO MAKE MORE MONEY, COLLECTORS USE CGC AS A SAFTEY NET, AND SPECULATORS USE CGC TO (HOPEFULLY) MAKE A LOT OF MONEY IN AN UPSWING MARKET.

 

Here is another bit of

 

MOST DEALERS TOLD US TO "TAKE A HIKE" WHEN WE CAME TO THEM AND ASKED THEM TO GIVE OUR SERIVCE A TRY, MANY TURNED DOWN THE $500 FREE VOUCHER WE WERE GIVING OUT. CAN YOU IMAGINE, WE OFFERED $500 FREE AND IN THEIR INFINITE WISDOM, THEY SAID NO. ONLY WHEN THEY SAW THE PRICES THESE CGC BOOKS WERE BRINGING BECAUSE COLLECTORS AND INVESTORS FELT SAFE BUYING CERTIFIED COMICS, DID THEY THEN START TO USE OUR SERVICE.

 

Have you been talking to Hammer/Hammer2/Dupcek/Comic-keys again?

[shadroch]

While we are cleaning up mis-information; There is no such thing as a former Hells Angel.UR in it for life.

[mrwoogieman]

And,

 

I think the confusion over the LLC business form is due to the fact that CGC calls its retailers "Charter Members", but this designation has nothing to do with who the members of the LLC are. More than likely the LLC doesn't even have individuals as members, it's probably made up of other business forms.

 

 

CGC could have called the affiliated retailers anything, but settled on "Charter Members" a seemingly innocuous title, until factless spinmeisters make the leap from Charter Member to member in an LLC...