The Whos, Whats, Whens, Whys And Hows Of Spending Your Collectible Dollars Wisely

My smart 20 something neighbor complained to me today that the collectibles market is a scam.  It seems that her carefully compiled collection of Beanies Babies, which she though would pay for her college tuition, won’t even pay for a semester’s books at her Ivy League grad school. 

While the conclusion that collectibles are a scam is an exaggeration, my young neighbor she raises a good point.  We can all remember the bubbles that have burst, the fads that have fizzled.  Remember Jim Beam bottles?  Collector plates?  Beanie Babies?  I can recall customers sprinting into shops in 1996 to plunk down $600 on the latest Beanie.  What are those Beanies worth now?  This illustrates that anyone involved in buying collectibles should do their best to spend their collectible dollars wisely.  

How do you educate yourself to spend wisely?  Start by asking a few basic questions about your prospective acquisition:

• Who made this item?  Was your item handmade by an artist or mass produced by a large corporation?  If the item was made by an artist, does that artist have a strong following outside of the collectibles world (possibly as a fine artist or a celebrity)?  What methods were used to produce and finish the product?  In what country was it made?  In the Harmony Kingdom collector’s world, many collectors will pay more for items made in England than for those made in China, every though the production methods are very similar.
• What is it made of?  Most collectibles do not have much intrinsic value, meaning the actual value of the materials used.  Value is created by scarcity, desirability, appearance and other factors that fuel collector demand.  Does your item contain any materials of intrinsic value (i.e. – precious metals, precious stones), that may have a strong market value independent of the collectibility of the piece?  If not, just remember that your collectible could be worth little if the demand for that item disappears.
• When was it made?  Age affects value, as does timing.  Was this a first issue, a later re-issue, or a collector’s reproduction? Vintage items are fantastic, but new items can have a lot of collector value too.  Just make sure that you know where your item falls on the production timeline, if applicable.
• Why was it made? Was your item made as a collectible?  Often, but not always, that can be the kiss of death for the future value of the item.   When 100,000 people buy the same collectible and too many of those people try to sell it at once, the price of that item will plummet.  Sometimes, however, timed or limited release items can have substantially secondary market value.  Similarly, items made as toys or ordinary items may become hot collectibles just because no one thought to collect them.
• How does it look?   “Condition, condition, condition” is to collectibles as “location, location, location” is to real estate.  Obviously, mint condition items like new old stock (unsold old merchandise in new condition) are wonderful to buy.  But collectors will also tolerate some imperfections, perhaps to fill a hole in their collection or because of the scarcity of that particular item.  Just have sure that the price that you pay correlates to the item’s condition.