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The Packaging Nightmare of the U.S. Mint Gold Buffalo Coins

When the U.S. Mint announced it was adding a .9999 gold bullion coin to its line of gold coins, it looked like a "golden chance" for the Mint to seize a huge chunk of 24-karat gold coin industry.  When legislation was passed mandating that the new coin bear James Earle Fraser's patterns that graced the legendary Buffalo/Indian Head nickels from 1913 via 1938, the new coin's potential looked even brighter.

Nevertheless, on release of the new Buffalo gold coin, the Mint's golden chance has turned into a nightmare at the retail level.  Whilst the coin itself is very striking, acquiring a matte complete and totally capturing the Fraser patterns, the packaging tends to make the coins a nightmare.

Though the bulk of the blame can be laid on Congress for attempting to "micro-handle" production and distribution of the coins, the Mint should take its reveal of the blame for the option of packaging, acquiring not considered, the retail elements of the packaging.

Congress mandated that the coins be individually encapsulated to safeguard them from damage, apparently to avoid problems that have risen with 1-oz Canadian Maple Leafs.  More, Congress mandated that the Mint have the coins all set for distribution by the conclude of June.  To meet the deadline, the Mint had to choose a method of packaging that was easily obtainable and that would accommodate predicted large quantity product sales.

The Mint selected a semi-rigid Mylar packaging, 5 coins horizontally with four coins down, generating 20 coins to a sheet.  With vast spacing between the coins, a "sheet of Buffalos" measures twelve inches by sixteen inches.  The packaging leads to several troubles.

Because of the rigidity of the Mylar, a sheet cannot be folded into a tall bundle.  Orders for much less than 20 coins have to cut out of the sheets for the coins to be packed compactly, which is sought after-and anticipated-for gold bullion coins.

Unquestionably, the semi-rigid packaging for the Buffalos was meant to offer long lasting safety.  Nonetheless, the Mylar is so rigid that an authentic sheet of 20 Buffaloes can't be conveniently stored.  A sheet of twenty can be rolled like a magazine and then rubber-banded, but then storage would consider a great deal of room.  Whereas the smallest of safe deposit boxes will hold hundreds of one-oz Gold Eagles simply because they arrive in compact tubes, probably only sixty or so Gold Buffalos would fill a tiny secure deposit box.

An additional issue that has surfaced: The coins easily arrive out of their protective sheets when handled.  This means the coins then have to be transferred to a tube or to person plastic sleeves, which are employed so typically for single coin purchases.  Or, the Mylar can be mended with Scotch tape, hardly an appealing remedy.
Due to the fact of the issues that have arisen with the packaging, Buffalos will not appeal to many large bullion buyers but to collectors, who might want only a number of coins.  Traders who ordered Buffalos without expertise of the packaging have been disappointed.  With the current packaging, it is not likely the Mint will seize considerably of the .9999 fine bullion coin market place.

While the Mint may possibly level to early robust income, new coins almost usually get pleasure from strong early revenue.  And, with the common Buffalo/Indian Head design and style, without doubt Buffalos will stay favorites of collectors and people hunting for gifts.  Nevertheless, the Buffalos ended up launched to go following the .9999 great gold bullion coin market place, wherever investors make repeated orders.  So, the test for the Buffalos will come in the months ahead when we understand if investors make second and 3rd orders for Buffalos.

It is the opinion of this 32-year veteran of the gold bullion coin marketplace that if the U.S. Mint does not make adjustments in Buffalo packaging, income will erode over time, and the Mint will miss a golden chance to seize a big piece of the pure gold coin market place, which is now dominated by the Royal Canadian Mint's Gold Maple Leafs.

The answer to the problem is for the Mint to change the packaging as quickly as possible, taking into consideration how big investors are probably to keep the coins-in protected deposit boxes.  For traders who do not store in protected deposit boxes, compactness turns into even far more critical, as the coins need to be straightforward to conceal.  The Mint appears to have totally ignored this element of the industry.
Additionally, the Mint requirements to keep in head that the coins have to be dealt with by bullion coin dealers who ship the coins to the last traders.  The present packaging causes twenty-coin or greater orders to be shipped in huge boxes, including to shipping charges.  The big boxes may also call for a lot more trips to the Submit Workplace.  It also increases the price of dealing with for orders significantly less than 20 coins, as they have to be reduce out of the sheets.
Because Congress mandated that the coins be individually encapsulated, the Mint should go with tough plastic capsules these as individuals employed by The Perth Mint.  Then the capsulated coins really should be set 10 to a tube, providing compactness for ease of storage.  That would also facilitate handling by coin dealers.

To correct the difficulty-and actually go soon after the .9999 bullion coin market-the Mint really should encapsulate the coins individually and place them in tubes of ten.  Then ten tubes need to be put in small, sealed, and long lasting boxes.  And, ultimately, 5 modest boxes of a hundred coins should be place in a more substantial box of 500, which is how the Mint ships its greatest-marketing Gold Eagles.  Boxes of 500 are popular with huge traders, and the boxes of a hundred would be desirable to medium-dimension investors.
Packaging the new Buffalos this way would facilitate storage and dealing with each for traders and for retail dealers.  The Mint desires to believe retail with its packaging, to consider into consideration how investors retailer, and to assume about the bullion dealers who manage the new Gold Buffalos in delivering them to pure bullion coin traders.

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