New U.S. Mint Buffalo Coins' Packaging a Problem
When the U.S. Mint announced it was adding a. 9999 gold bullion coin to its line of gold coins, it appeared like a "golden chance" for the Mint to catch a huge portion of 24-karat gold coin market. When legislation was passed mandating that the new coin bear James Earle Fraser's designs that beautified the famous Buffalo/Indian Head nickels from 1913 through 1938, the brand-new coin's future looked even brighter.
Nevertheless, on release of the brand-new Buffalo gold coin, the Mint's golden opportunity has actually become a headache at the retail level. While the coin itself is quite striking, having a matte finish and entirely capturing the Fraser styles, the packaging makes the coins a problem.
Although the bulk of the blame can be laid on Congress for attempting to "micro-manage" production and distribution of long beach packing services the coins, the Mint should accept its share of the blame for the option of packaging, having not considered, the retail elements of the packaging.
Congress mandated that the coins be individually encapsulated to secure them from damage, obviously to avoid problems that have increased with 1-oz Canadian Maple Leafs. Even more, Congress mandated that the Mint have the coins all set for circulation by the end of June. To satisfy the deadline, the Mint needed to pick a method of product packaging that was easily offered and that would accommodate expected big volume sales.
The Mint chose a semi-rigid Mylar packaging, five coins horizontally with 4 coins down, making twenty coins to a sheet. With broad spacing between the coins, a "sheet of Buffalos" procedures twelve inches by sixteen inches. The product packaging causes several issues.
Due to the fact that of the rigidity of the Mylar, a sheet can not be folded into a high bundle. Orders for less than twenty coins need to cut out of the sheets for the coins to be packed compactly, which is desired-- and anticipated-- for gold bullion coins.
Undoubtedly, the semi-rigid product packaging for the Buffalos was implied to provide long lasting security. However, the Mylar is so rigid that an initial sheet of twenty Buffaloes can not be easily kept. A sheet of twenty can be rolled like a publication and then rubber-banded, but then storage would take a lot of space. Whereas the smallest of safe deposit boxes will hold numerous 1-oz Gold Eagles since they are available in compact tubes, maybe only sixty or two Gold Buffalos would fill a little safe deposit box.
Another problem that has actually emerged: The coins easily come out of their protective sheets when handled. This suggests the coins then have to be moved to a tube or to individual plastic sleeves, which are utilized so typically for single coin purchases. Or, the Mylar can be mended with Scotch tape, barely an attractive service.
Because of the problems that have actually emerged with the product packaging, Buffalos will not attract numerous big bullion purchasers however to collectors, who might want only a few coins. Financiers who purchased Buffalos without knowledge of the product packaging have been dissatisfied. With today product packaging, it is unlikely the Mint will catch much of the.9999 fine bullion coin market.
While the Mint may point to early robust sales, brand-new coins almost always enjoy strong early sales. And, with the popular Buffalo/Indian Head design, undoubtedly Buffalos will remain favorites of collectors and people searching for gifts. However, the Buffalos were introduced to go after the.9999 fine gold bullion coin market, where financiers make repeated orders. So, the test for the Buffalos will come in the months ahead when we find out if financiers make 2nd and 3rd orders for Buffalos.
It is the opinion of this 32-year veteran of the gold bullion coin market that if the U.S. Mint does not make modifications in Buffalo packaging, sales will wear down gradually, and the Mint will miss a golden opportunity to catch a big piece of the pure gold coin market, which is now controlled by the Royal Canadian Mint's Gold Maple Leafs.
The option to the issue is for the Mint to alter the packaging as quickly as possible, taking into account how large financiers are likely to save the coins-- in safe deposit boxes. For investors who do not store in safe deposit boxes, compactness becomes much more important, as the coins should be simple to hide. The Mint seems to have actually totally ignored this element of the market.
Additionally, the Mint requires to remember that the coins need to be handled by bullion coin dealerships who deliver the coins to the last investors. The present packaging triggers twenty-coin or bigger orders to be shipped in large boxes, contributing to shipping costs. The large boxes might likewise require more trips to the Post Office. It also increases the expense of dealing with for orders less than twenty coins, as they have to be eliminated of the sheets.
Given that Congress mandated that the coins be individually encapsulated, the Mint should choose tough plastic pills such as those utilized by The Perth Mint. Then the capsulated coins must be put ten to a tube, supplying compactness for ease of storage. That would also help with dealing with by coin dealers.
To correct the issue-- and really pursue the.9999 bullion coin market-- the Mint must encapsulate the coins separately and put them in tubes of ten. Then 10 tubes ought to be put in small, sealed, and long lasting boxes. And, lastly, 5 little boxes of 100 coins need to be put in a larger box of 500, which is how the Mint ships its very popular Gold Eagles. Boxes of 500 are popular with large financiers, and packages of 100 would be attractive to medium-size investors.
Product packaging the brand-new Buffalos this way would help with storage and dealing with both for financiers and for retail dealers. The Mint requires to believe retail with its packaging, to think about how investors store, and to think about the bullion dealers who manage the brand-new Gold Buffalos in delivering them to pure bullion coin financiers.