Collecting First Editions - Exorbitant Premium That Professional Book Sellers Charge

I'll start by saying this: unless there is some kind of life-threatening situations or someone else is footing the bill, avoid buying first editions from the so-called professional book sellers because they charge exorbitant premium. Some examples of these professional sellers are Bauman, Peter Harrington, and Whitmore.

Professional rare book sellers used to play an important role when there wasn't the internet or a ready market for rare books.  Then, they had to meticulously catalogue the first edition points, earnestly scout garage sales for neglected gems, cautiously stock inventory and pay rental while performing price discovery. Today, with the prevalence of the internet and electronic markets like eBay and abebooks, it is unclear if professional rare book seller should continue to charge a high premium for their services. Sure, they still pay rental (but mostly in terms of site maintenance rather than actual shop front rental) and some are still great sources of knowledge, but any collector interested in the first edition points of modern literature can find them on various sites like fedpo or on my site. Price discovery is also better done through the electronic markets where there are sufficient market depth. And these book sellers don't have to sweat it out to find rare books anymore; they mostly just bid for them at auctions and then charge inflated prices for being a convenient middleman. I mostly have issues with such rare book sellers: they really add no incremental value in the process but demand huge premium. As a book collector, I say we should boycott them until they reinvent themselves and add actual value to the rare book markets, or adjust the premium they demand as middlemen.

Let me give you some examples. I received Whitmore Rare Book's Catalogue 15 in my inbox today (May 15, 2017), only to find that several listings are from March 2017's rare book auction by Heritage Auctions, with hefty increases in their price tags.

First up, a near fine copy of Norman Mailer's "The Naked and the Dead". Whitmore got the book from the auction at $1,500 all in (left side), and conveniently lists it for $3,500 (right side). A $2,000 premium for doing what?

 

Next up, Robert Frost's "New Hampshire". Whitmore got it for $813, but lists it for $2,000. Does that even make sense?


Finally, Hemingway's "To Have and Have Not" Whitmore is asking $1,450 for a book it got at $550.


For each of these three books, Whitmore is asking 133% to 164% premium on what it paid. Minus the packaging and mailing costs, which cannot be more than $100, but let's just make it $137 so that the total cost is $3,000, Whitmore stands to make a whopping $3,950, or 131%, on the total sales price of $6,950 for nothing more than a middleman service. That's mind boggling and ridiculous. Even if Whitmore offers you a 30% discount on the listed prices, which definitely sounds generous, it still stands to gain $1,865 collectively, or a 62% profit margin.

So the next time a rare book seller gives you a 15% discount, hold off that grateful handshake or appreciative tear, cos the sucker is still, well, you: say you walk into Whitmore, pick up the Mailer at $3,000, a 14% discount over the listed price, and after a week, suffer from buyer's regret and list it for sale at a book auction, remember you will get only $1,500 less the auction fee, which is about 15-20%, of about $1,200. A professional seller like Whitmore will likely pick that same book up from the auction and then awaits another sucker to come along to pay it a scalper's field day.

Parting words: rare book sellers should be paid for holding inventory, but not with such rich a premium.

You may also be interested in my discussions on collecting first editions as an alternative investment, or buying first editions on eBay (including some sellers to avoid), or what is a first edition in general.