Potentially valuable collections show that a large effort (and usually cash) went into gathering and organizing the collection. Printed stamp pages or carefully hand-printed pages are usually positive. Three-ring binders might be OK, but Scott albums or other manufactured albums reflect intent to create a collection. Stamp purchases from well-known dealers are worth more than post office purchases. The more spent, the more returned. The presence of high-value stamps could be good. A specialized country collection will often be more valuable than a general, whole world collection. A collection is one that has been sorted, identified, cataloged studied and carefully mounted.
A box of loose stamps is not good. Boxes and envelopes stuffed with miscellaneous stamps do not have great commercial value, and in fact are not even a collection. The majority of recent stamps (after World War II) are of little value. If the stamps are dog-eared, untidy, heavily cancelled and with lots of pretty pictures, then odds of value are not good.
One of the most misunderstood subjects (to the novice or uneducated) is catalog value. Oftentimes, the collector or owner will painstakingly add up all the catalog prices in the collection only to be disappointed when the offer is much lower. This is because the catalog value is a list price from which the vast majority of all stamps are heavily discounted when being bought and sold. Only if a stamp is in the top grade might it actually sell at full catalog value. The catalog is listed high enough to allow for fluctuation in the stamp condition per issue and allow some profit for the dealer. The collection may also consist of many more common, easier-to-obtain stamps with lots of low catalog values, but which are frankly less desirable. Lots of low-book catalog stamps added up do not make a more desirable collection! In addition, stamps are routinely sold in collections, lots and groups in the 15-30% of catalog range simply to create a sale-able unit from the dealer’s perspective. It’s a win-win situation, as the collector gets a big discount, but has to buy more and take some he may not want, and the dealer handles a worthwhile unit. The point is, don’t think your dealer is a crook for not paying 50% of book. Everybody loves a huge discount when buying, but they forget about it when selling years later.
The important thing with stamps, as with any commodity, is the condition of the article. You would not buy a suit or dress that was torn or had threads pulled on, or was in a shoddy state. You buy food items that are clean, fresh and wholesome. When you buy a used car you inspect it carefully. On the surface it might look new, but if the pistons are worn and the bearings bad, you would be cheated if you bought it. Similarly, stamp dealers have to inspect stamps. The prices in the catalogs are for absolutely undamaged, perfect specimens. If not cancelled (used), they must have the original glue or gum on the back. They may not be dirty on the front or back. Furthermore, the design must be called “well-centered” with an equal amount of blank border surrounding the design on all four sides. Cancelled stamps must not be smudged, smeared or the picture obliterated, and if so they are next to valueless.
A dealer must break up a collection or estate that was assembled with pride into smaller, sale-able units. They are investing their capital funds (cash) and time sorting through large quantities of stamps, weeding out the common and unpopular, damaged and forged, just to find the scarcer or simply needed stamps. Stamp dealers as a group of business people have a reputation for honesty and fairness. Don’t forget the dealer’s offer must take into account the work that has to be done to complete the organization of the collection and prepare it for sale. The amount you are offered will also reflect the difficulties of selling the stamps and current market values. Selling to a reputable dealer is the easiest way to get a fair price.
We never suggest people collect stamps as an “investment”. Having said that, it is a fantastic hobby that can yield years of enjoyment, friendships and, depending on what is collected, maybe even a decent portion of money spent returned. Even so-called financial investments don’t guarantee a profit. Look at the 2001 tech bust and recent stock market meltdown to prove that. People often apply an unreasonable view to their stamps. If a person plays golf or goes to dinner for $50, they would get ridiculed if they took their receipt back to the register for some money back. The business would say you simply enjoyed yourself for a few hours, end of story. Most stamps can be sold back assuming they are not utter junk. In the normal scheme of things, most collectors buy at retail, selecting carefully each item set by set, lot by lot. Then they sell at wholesale. They sell their entire collection due to boredom, financial necessity or death. Only strong upward prices after the passage of much time will allow the wholesale prices to be higher than the retail prices paid at the time of purchase.