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Cost of shipping monster boxes; dealer costs


Bimetallic

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Hi all – I'm curious to know the cost of shipping monster boxes of silver, both within the US and between the US and UK. Have any of you done it, or gotten a quote?

I could price out a similar shipment on the websites of various carriers, but I'm not sure how large precious metals shipments are normally handled. Do dealers use the likes of FedEx, UPS, and DHL for such shipments? I wasn't sure if more specialized high-value shippers were used (Brinks?), or if it's just a matter of tacking some third-party shipping insurance onto a regular carrier shipment.

If any of you have some insight into how dealer to dealer or wholesale shipments work, I'd be glad to know all about it. I'm curious because I'm thinking of getting into the business but the silver bullion prices I'm seeing in the US don't make any sense to me, not if shipping is factored in.

Example 1: Silver.com is selling Silver Eagles for $17.86 in small quantities, and the price only gets lower as quantities increase. The US Mint sells Silver Eagles to its distributors for a flat $2.00 over spot. Assuming a spot price of $15.00, that's a combined markup of 86 cents (!) A little more if we assume silver spot was a bit lower than $15.00 when the distributor bought them. Still, that combined markup by both the distributor and Silver.com (who is not a US Mint distributor – they had to buy them from one) is absurdly low even ignoring shipping. I assume the shipping from the US Mint to the distributor isn't cheap. The minimum order is 25,000 ounces, so 50 monster boxes. If there's also gold in the order, there might be more than a million dollars worth of metal, and I assume specialized high-value shippers are used. (There's probably no shipping between the distributor and Silver.com because the distributor in this case handles fulfillment for Silver.com.)

Example 2: Silver.com sells Britannias for $17.26 (again in small quantities – the price only goes down from there). This is $2.65 cheaper than the BullionByPost price in the UK (before VAT!), which makes no sense at all. Silver.com is not an official distributor of the Royal Mint, so they have to buy Brits from such a distributor. Britannias have to be shipped across the pond to the US, which I assumed was very expensive. Silver is heavy and bulky, and somewhat valuable. I don't know what the Royal Mint charges for Brits, but I assume it's at least a dollar over spot, maybe a pound over spot. Maybe more. $17.26 doesn't make any sense given that it had to be shipped from the UK to the US, then shipped again from the US distributor to Silver.com, and profit margins need to be added.

Is shipping silver in bulk a lot cheaper than I assumed? Cheap enough to come in under 30 or 40 cents a coin?

Thanks for your thoughts.

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Traditionally bulk shipping is done on an individual negotiated basis. You open up an account with a courier/USPS/any random shipper and you'll have an agent you negotiate a rate with. Essentially the more you ship the cheaper your rate is. I don't know all the services that will be open to you in the US so I'll stop short because my UK examples likely won't apply. But that is the essence of it. The more you ship the cheaper it is.

EDIT - because of the above you aren't going to be able to get a realistic idea of what a dealer would pay to ship a monster box. You could try sending them emails and asking them but they might not answer. The only pricing information that will be available to you is consumer level one off pricing. That being said you could phone up or email the couriers or USPS and enquire about business pricing. That should give you a decent amount of information and let you know how much you need to send before certain rates are available to you.

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If you add up fee from customs it wont be so cheap any more, they can even send a ticket and destroy goods at your cost. If you want to bring that legally you will have to pay duty as fare as i remember 20%? 

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2 hours ago, Michal said:

If you add up fee from customs it wont be so cheap any more, they can even send a ticket and destroy goods at your cost. If you want to bring that legally you will have to pay duty as fare as i remember 20%? 

I wonder if the fact that your going on to a third place if you don't pay taxes when connecting and perhaps a reason one airport janitor found gold ingots in a trash can as someone was avoiding taxes and had placed them in the trash for anot her person to pick out and sneak them through immigration and into britain?.

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On 06/07/2019 at 13:56, AppleZippoandMetronome said:

Traditionally bulk shipping is done on an individual negotiated basis. You open up an account with a courier/USPS/any random shipper and you'll have an agent you negotiate a rate with. Essentially the more you ship the cheaper your rate is. I don't know all the services that will be open to you in the US so I'll stop short because my UK examples likely won't apply. But that is the essence of it. The more you ship the cheaper it is.

EDIT - because of the above you aren't going to be able to get a realistic idea of what a dealer would pay to ship a monster box. You could try sending them emails and asking them but they might not answer. The only pricing information that will be available to you is consumer level one off pricing. That being said you could phone up or email the couriers or USPS and enquire about business pricing. That should give you a decent amount of information and let you know how much you need to send before certain rates are available to you.

The US Postal Service publishes its commercial pricing, and this year they merged their two classes of commercial pricing (Base and Plus). I think negotiated rates are only available to extremely large scale shippers. I know Amazon negotiated their rates with the USPS, but I'm not sure what the volume threshold is for that. I'll find out. There might be discounts available through certain shipping software providers.

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