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Tuesday, May 3, 2016

Catalogue Values - An Aid or Impediment to the Hobby?

In one of my earlier posts to this blog I wrote about the many misconceptions surrounding catalogue values and how they are often misused by collectors and dealers alike. In this post I wanted to share some of my thoughts as a dealer about the impact that catalogues have had on the hobby in general.

On the plus side, catalogues serve several very useful functions:


  • They help a collector to become aware of the scope of extant material available in a potential area of collecting interest as well is indicating to a collector the potential level of detail they can get into should they wish to. A collector can view catalogue listings to decide if an area they are potentially interested in collecting will provide enough scope to maintain their interest or not. So they are useful in helping a collector make educated decisions about where they want to concentrate their collecting efforts. 
  • They provide information about stamps sufficient to give a collector a working knowledge of a particular philatelic area, though I would venture to suggest that unless they are using a highly specialized or detailed catalogue, there is probably not enough information contained in it to make the reader an expert. Becoming an expert usually requires years of experience working with many hundreds or thousands of examples of the stamps in question, combined with an in-depth knowledge gleaned from all the major publications about the particular philatelic area in question. 
  • By providing pictures and dimensions of the stamps listed they can help a collector design and plan the layout of their album pages. 
  • They provide a collector with a baseline figure of the magnitude of outlay involved in forming a basic collection of a particular philatelic area in above average, but not perfect condition. A collector can tell at a glance if the area they are interested in collecting is likely to be affordable for them over the longer term. 
  • They enable a collector to quickly determine a catalogue value for their collection, which can be a useful starting point for helping them determine what their stamps are worth and they are excellent for people trading stamps to determine is a swap is a fair swap by comparing the catalogue value of the stamp they are receiving in the exchange, with the catalogue value of the stamp they are giving up.
On the negative side though, there are several ways in which catalogues have limited the hobby:

  • By making the minimum catalogue price only 25 cents, they have made a lot of material inaccessible to collectors who do not wish to acquire the material in large bulk lots. It is next to impossible for a dealer to make a profit or cover his overhead costs by selling anything for less than $1 these days. Think about it. What was the last thing that you bought at any store for less than $1? Not very many things. Except for certain  grocery items and small screws, practically everything now costs at least $2-$10. Have you ever thought about why that is? The consequence of this is that dealers won't bother to maintain comprehensive retail stocks of these stamps because it is simply not worthwhile to do so. As a result, entire philatelic areas that could be really rewarding for study, such as early Hungary, early Poland, early Czechoslovakia and many other countries languish because the catalogue values are too low for any dealer to bother carrying the material. This in turn means that the demand for it never becomes high enough for the prices to rise, which in turn means it never becomes widely available to collectors. If catalogues had no prices and simply focused on providing information about the stamps then dealers could charge prices that made economic sense to them, which would provide an incentive to stock all material at a retail level. This in turn would have a positive effect on the hobby I think. 
  • They are highly simplified publications and do not do a particularly good job of letting people know which type of material commands much higher prices than what they are listing. For example, stamps in stellar condition grades, used multiples, covers and special printing varieties. The catalogues will state that they should sell for more, but not how much more, which makes such notations next to useless.  
  • By listing prices, they have fostered a collector culture that is overly focused on the value of their collections, and getting things for less than catalogue as opposed to people who are enjoying a hobby, without an expectation of financial return. If there were no catalogue prices,, then I believe collectors would behave much as other hobbyists do: they would enjoy their hobby and would pay their suppliers for the stamps they wanted without giving it much of a second thought. 
  • Many people base their collection scope on what is listed in a standard catalogue such as Scott, Gibbons, Yvert, Michel or Unitrade. If an item isn't listed, then most people won't collect it or ascribe much value to it, unless they are super specialized expert collectors. By keeping the listings relatively simplified, they are holding the values of a large quantity of scarcer items down because many collectors simply don't become aware of their existence. You can't demand or want a stamp that you do not know exists. 
  • They have contributed to the destruction of philatelic material, specifically blocks and multiples of the early issues. By not listing prices for multiples and blocks or otherwise giving the impression that a large block is worth less than the sum of its component stamps, they have encouraged stamp dealers to break them up into singles, which they can value easily. Because they don't list multiples, collector demand for multiples remains low, except from very specialized collectors. Said multiples get broken up so they are no longer available for study and as a consequence, entire pieces of the philatelic puzzle, such as sheet positions for varieties, plate layouts and so forth are lost forever. They had the same impact on postal history in the earlier part of the last century: the number of priceless covers that were destroyed to soak off the used stamps because those were listed while the covers were not must be staggering. Again, information about certain postage rates and routes have been lost forever. Such would not be the case I think if there either were no prices or if everything that exists were listed and priced. 
  • Because they do not generally contain enough information to make their readers experts in the material they are studying, they can lull collectors into thinking of themselves as experts when they are not, especially with regards to market values for stamps.  This leads to many instances where a collector misses out on an important stamp because they do not recognize its rarity or significance, or many arguments with dealers over the prices the dealer is asking for scarcer and more desirable material. The result is often missed opportunities to buy key items that never come up again in that collector's lifetime, or album spaces that remain blank because a collector is unwilling to pay a dealer's asking price because of their belief that they can get it cheaper at some later date from someone else. 
These are just my thoughts as a dealer. I get very frustrated sometimes with catalogues because I will often see a stamp I would like to add to stock, but then I can't buy it because I can't sell it for what I believe it is truly worth based on my knowledge and experience. Instead, I'm stuck with some catalogue value, that while it may be valid for a different copy of the stamp I'm looking at, it is not applicable to the stamp I want to sell. So I wind up not buying it or having it to supply to my customers. So, in my opinion everyone loses. What is the solution? I believe that stamp catalogues should be replaced by detailed handbooks that give all the detailed information that a collector needs to study their material, but I don't think they should list prices anymore. Dealers will not charge collectors more than collectors are ultimately willing to pay over the longer term, or risk going out of business and they will offer collectors competitive prices for their collections or risk losing the collection to another dealer. Getting rid of prices will reduce the pre-conceived notions that collectors have of value and instead would require them to behave as consumers do in nearly every other market: evaluating whether the dealer's asking price is what they feel comfortable paying or not. The amount of available philatelic material at a retail level will increase, which will spur the growth of interest in hitherto untapped collecting areas. These are just by 2 cents.