Very Interesting Auction Item

Did anyone else see Harmer Shau Auction #106 Lot #3186? See link below;

http://stampauctionnetwork.com/hs/hs106160.cfm#268

Very interesting!

You are right that is very interesting!

I am not at all surprised. It was a lot of work for not a lot of turnover.

EXTREMELY Interesting. If it's that good and consistent, "Why" would Jim Forte be dumping the low-end cover site. Can't turn goods? Diminishing customers? The regular site not pulling or could be next? Something doesn't smell kosher. He could have folded it into the regular site and dropped the name. There's more to it than just churning $-dollar covers. Perhaps what remains of the stock is totally "dead."

Listing description:


This might be a nice small business for someone, but it will be a lot of work for little return.

I would guess he just wants to dump his $1-2 stock in one go. The domain name has little value.

$2000 to $3000 per month at what running cost? You have to keep buying more stock as you go and there is no way of knowing if you bought the business if it would stay a float. The covers all seem to be low end ones to. I see covers on sale at $1.25 on the site what a lot of work with over 160,000 covers for sale. I can tell you I do better on ebay with only 20 to 30 auctions 5 days a week. With the estimate $35,000-40,000 personally I'd buy a stack of better covers like Zeppelin, Mulready, CSA & penny black covers and throw them on ebay. I like the sound of this lot better

Worldwide Covers, Extensive Zeppelin Flight Collection, over 420 covers or cards for numerous flights incl. Graf Zeppelin, Hindenburg, LZ130, Los Angeles, Akron/Macon and modern, noted Germany #C38-39, C40-41, C43-45, dispatches and/or frankings from Tripolitania, Cyrenaica, San Marino, France, Italy, Saar, Danzig, Japan, Aegean Islands, Argentina, U.S., Liechtenstein, Switzerland, Spain, G.B., Romania, Austria, Brazil, Bolivia, Czechoslovakia, Egypt, Uruguay, Paraguay, Finland, Hungary, Russia and Iceland, must be viewed to appreciate, generally Fine to Very Fine.
Estimate $10,000-15,000.

Wow - I wasn't aware of the site. It still appears to be operational, I'll have to make a few purchases before it disappears.

I can see the problem here - high inventory of lower value items creates quite a bit of labor for little profit. Unless there is some way to automate this, I'm sure it's rough to justify the amount of work for the amount of income.

Paul

I have gotten a few good items over the last years but inventory is not updated and they are not responsive. For example I collect 1990's commemoratives on cover which he groups into 1950 and newer Commemoratives with about 2500 covers. That is nearly 70 years of postal history and a big headache to search through and see all the same covers. I asked them to put a category 1980 and newer but no response. Also the site has no search feature and avoids using Scott numbers. Both big detractors in my opinion. Value? Probably less than $10k. Only an idiot would buy a business as a stamp lot in an auction in my opinion.

You would have to be just plain silly to buy the business at $35,000-40,000. Why would you? Its like paying $35,000-40,000 for a domain name and an over supply of cheap modern covers that would be hard to resell. There's simply to many cheap covers to search through on the site buyers would give up looking. Ad says included all customer records of 1000 collectors who have purchased from site, what about their privacy? Seller is simply going to hand all their addresses, phone numbers and emails to whoever buys the business? Now 1000 collectors since 2005 this is not a big number and how many of them only bought once? How many repeat buyers on the website? Why waste your money on this business when you could start your own ebay business and with that amount of money buy a huge amount of higher valued covers? Your really counting on someone buying several $3.75 to make any sale worthwhile from the site. Its just to much work with little reward. A dealer needs to offer higher priced scarce material and have buyers coming back for repeat orders. And the site http://www.discountcoverstore.com/ has a lot of work to do for little return this shows that ebay is the best place to run a stamp / cover business. You're much better off selling on ebay. Value of the business site less than $5000 and that's really just for the stock and that's if the web site is accurate and has removed all sold items.

160,000 lots. That is not a stamp cover business it is an on line stamp cover collection.

The figures are very close to our ebay turn over per month but we have only 1,000 listings.

So that is 159,000 lots on offer more than we have for the same return......No it is a stamp cover collection not a business.

So whose going to buy the collection at that price?

KVG - thanks for your insight. Looking at this from the financial perspective the opening bid is valuing the business at 1x yearly sales or .12 per cover simply for the stock. I'm just trying to figure out how the business could make money and be worth the 24k investment. It's obvious why it's being sold.

Crouse27 - the privacy laws in the U.S. are not a problem here. The customer details are a part of the business that can be transferred to a new owner, even if the site claims they will never sell your personal information, in this case the business that owns the client list is being sold, not just the client list.

Paul

Sales $2000 to $3000 per month if $3000 means he has to sell over 800 covers a month I wonder if the sales are realistic or made up?

Talking trash, duncanvr? I doubt that Mr. Forte is worthy of such treatment.

Did it sell? I don't see anywhere on the page that it is for sale.
Never mind, found it.