Why Numismatic is important? Essences of Numismatic

Week 43.1 Why Numismatic is important? Essences of Numismatic

Do your parents, grand parents or great grand parents  left you something for you to remember as a token. An old coin will do. Queen Victoria Straits Settlement 50 cents will do. hihi.

Throughout your life time did you keep any money. What is the proof? Where is it?

Thus, it is important to keep some at least for your own shown that you have some $$$ for yourself and your future kid.

For each year you have live, you owned the money and you still have some of it. Nice omen. When you died, it is left to your kid as saving, evidence that you have left something for them. No need to be expensive. Maybe a 10cent or RM1 note of each year will do. It is affordable for most of you.

Best known bank notes are the first bank note for Malaysia printed in 1967 was given away by Bank Negara Ismail Mohd Ali to the Agong.  It was sold at $115,000 pound in 2008 auction.

Aiyah! Ismail Mohd Ali should have make 1000 presentation album. A/1  000001 to A/1  001000. Just like the RM50 50^th Aniversary gold line was selling like a hot cake. Price is easily RM400/pc now.

I don’t know how these notes end up in auction house in SG. Maybe someone can share. This is Malaysia property mah, should not be sold at any price. The first money you have and yet you given away to somebody. Not a good sign or omen. I don’t wanna to raise any more sensitive issue causes I don’t have time+power+network to handle difficult issue.

Well, for Precious Metal I will talk more on numismatic aspect in my future blog article.

>>> 

http://www.coinpeople.com/index.php?/topic/28024-the-worlds-most-expensive-asian-banknote-sold-at-spink-action/

http://dniewcollectors.blogspot.com/2011/05/malaysia-numismatic-newsthe-worlds-most.html

Today Spink’s World Banknotes auction featured numerous rarities which realized unbelievable prices. Without a shadow of a doubt, the highlight of the sale was a collection of the first ever Malaysian banknotes. The lot was purchased for an amazing £115,100, four times the original estimate, which broke Spink’s previously held record for the most expensive Asian Banknotes sold ever at auction.

The banknotes were a gift presented by Ismail Mohd Ali, on behalf of the Board of Governors of Bank Negara Malaysia, to the (fourth) King of Malaysia, Tuanku Ismail Nasiruddin Shah. They are preserved in a blue leather presentation album with the title Bank Negara Malaysia and arms in gold on the front cover. The folder contains the following: 1 ringgit, blue and multicoloured, 5 ringgit, green and multicoloured, 10 ringgit, blue and multicoloured, 50 ringgit, blue and multicoloured and 100 ringgit, purple and multicoloured, all ND (1967), serial number A/1 000001, all with portrait of Yang Di- Pertuan Agong, TuAnku Abdul Rahman, first King of Malaysia, at right, all are signed by Ismail Mohd Ali, value at centre and at each corner, all notes are mounted in card with gold border (Tan M 27, 28, 29, 30, 31). There is also a second presentation album containing 1000 ringgit, ND (1968), serial number A/1 000001, purple and multicoloured, portrait of Yang Di- Pertuan Agong, TuAnku Abdul Rahman, first king of Malaysia at right, signed by Ismail Mohd- Ali, value at centre and each corner, mounted in card with gold trim (Tan M 32).

4P. Product, Price Promotion and Place

Week 42.1. 4P. Product, Price Promotion and Place

Here is the definition of 4P in Wikipedia.

http://en.wikipedia.org/wiki/Marketing_mix

Let see how 4P affects our precious metal market.

Product : Whether you buy from me or someone else it is the same product 1 oz silver bar. However, you may need to inspect the goods condition whether got any scratches etc.

Sol: Offer some other product which nobody can offer. If it’ s the same product complete on price, place and promotion.

Price : Well, there are many avenue for one to view the current prices offered by others. Your price must be among the lowest at least in your region. Those with big capital will win-lah.

Promotion : Whenever there is a product for sales, how many people know about you or your product? How quickly they know about it? Must do multi-channel marketing, blog, email, facebook, ebay etc to get the coverage.

Place : Since postal services may be unreliable depending on your lucky. On top of that, you may want to COD since the item you buy is somewhat expensive and you would like to see the real stuff before handling over the $ to them. Thus, location is important. If U R at KL CC, KL SENTRAL etc SENTRAL fatt fatt fatt. 228 lah. if U R at Ulu Ulu place, then 224 lah.

As you all know most sellers are doing it part-time, so far as of now who is the winner in this game. Well, those who have price, promotion and places are winning market share now.

Since the margin is so low, agent distribution model is failing now and will stop very quickly. In no time, the seller will have no choice but direct selling. Direct fight or else you can never win. At the mean time, customer is enjoying the show.

You can also view the 4P definition below taken from wikipedia

Elements of the marketing mix are often referred to as the "Four 'P's", a phrase used since the 1960's

• Product - It is a tangible good or an intangible service that is mass produced or manufactured on a large scale with a specific volume of units. Intangible products are service based like the tourism industry & the hotel industry or codes-based products like cellphone load and credits. Typical examples of a mass produced tangible object are the motor car and the disposable razor. A less obvious but ubiquitous mass produced service is a computer operating system. Packaging also needs to be taken into consideration. Every product is subject to a life-cycle including a growth phase followed by an eventual period of decline as the product approaches market saturation. To retain its competitiveness in the market, product differentiation is required and is one of the strategies to differentiate a product from its competitors.

• Price – The price is the amount a customer pays for the product. The business may increase or decrease the price of product if other stores have the same product.
• Promotion represents all of the communications that a marketeer may use in the marketplace. Promotion has four distinct elements: advertising, public relations, personal selling and sales promotion. A certain amount of crossover occurs when promotion uses the four principal elements together, which is common in film promotion. Advertising covers any communication that is paid for, from cinema commercials, radio and Internet adverts through print media and billboards. Public relations are where the communication is not directly paid for and includes press releases, sponsorship deals, exhibitions, conferences, seminars or trade fairs and events. Word of mouth is any apparently informal communication about the product by ordinary individuals, satisfied customers or people specifically engaged to create word of mouth momentum. Sales staff often plays an important role in word of mouth and Public Relations (see Product above).
• Place – A way of getting the product to the consumer and/or how easily accessible it is to consumers.

Any organization, before introducing its products or services into the market, conducts a market survey. The sequence of all 'P's as above is very much important in every stage of product life cycle Introduction, Growth, Maturity and Decline.

Back Off

Week 41.2 Back Off

Recently, I drove all the way to northern KL for delivery only to cancel the deal myself. Rugi petrol, masa. Waste time and $$ but still got to uphold my principles.

Why?

Well, when I reach the place his relatives face look familiar with someone I deal before but not him. Later on I discover that it is someone related to a person whom back off from my earlier deal before.

Here is the story goes.

Back in Sept 2011, Mr A brought some item from me a few times. Relationship was smooth and good. Then, he placed an order for X oz (reasonable big) thus I hedge additional X oz with my supplier. Within a few days, the spot price drop from USD40 to USD26, he then back off from the COD twice. He said someone died. Etc. I experience a market lost of approximately RM20/oz and hold X oz for few months not moving at all.

All these while he told me was he is jobless, buying on behalf of his father who stays in northern region. Since he back off, just don’t come back-lah.  Then I received an ebay sales from someone Mr A dad, I don’t know is Mr A dad. After sorting out the logistic, it was decided to deliver to his relative at Northern KL to inspect the goods. Upon verification, Mr A dad will bank in the $ into my account.

Having known that it is Mr A dad who back off from earlier deal, I decided to cancel the deal.

Mr A Dad said it not good for my reputation. So I decided to write this blog and let you all decidelah. Have I done the right thing?

Then he told me his son uses his $ to do business and now he is buying for himself. The fault is in his son. I also don’t know who to believe, best is earn less, not to deal with them anymore. Well, he can also buy from someone else at a slightly higher price I guess.

Nevertheless, if you are desperate for sales let me know I can pass you their contact. Thank god there is no major price correction and movement when the dispute occurred, we have considered the case is closed and let move on to other things.

BuyBack commitment is not sustainable

Week 41.1 BuyBack commitment is not sustainable

One of the common questions people asked is “Is there any buy back guarantee?”

Some vendor do offer buy back policy. For me, I stick with my rule. No buyback. Sometimes, I will offer to buy back but it’s on case to case basis.

Let do some basic arithmetic to determine the scalability of such buy back scheme. This is not me, but I wish it is me. I’m not so kaya/rich lah. Nevertheless it is for you to think about it.

Premise 1: Precious Metal margin is very low, for simplicity of calculation let use the figure 2% nett profit margin.

In order to earn RM10,000/- per month at 2% nett profit margin, the vendor need to sell RM10,000/ 2% = RM500,000/- per month or RM6 million a year.

Premise 2: Amount of cash capital he had maybe RM250,000 with rolling of 2x a month. That make up, the sales of RM500,000/- per month.

Premise 3: Assume there is a big profit taking process RSI-14 > 70, many customer want to sell back to you. Very few are buying. Let said 12% of his annual customer sell back to him within 2 weeks period and only 2% of his customer is buying. He need to fork out a cash of 10% of annual sales which is RM600,000/- but his capital is only RM250,000.

Thus, in good times, buy back is not an issue. In fact it is encouraged as seller will and wanted to make more profit. In stress time (big profit taking, market cut-loss), he will not be able to buy back from you if he unable to sell back to his supplier. Suppose he able to sell back to his supplier, the pricing must included the freight charges, lower buy back price most likely at spot price.

In summary, there are only few institutions which can guarantee buyback

a)      Bullion vendor with hedging and buyback mechanism with the wholesale bullion vendors.

b)      Banks

c)      People with lot of cash