Collecting Basics, part 4

This is Part Four in a series by Kirby McDaniel of MovieArt for Jon Warren's "Movie Poster Guide". It is reproduced here as a service to collectors with Jon's permission. Click here for Part One.

The poster market: buying.

Posters may be bought from other collectors, from dealers, from auction houses and from online auctions and websites.

Buying from dealers and collectors is usually pretty straightforward. Buying from another collector is largely a matter of trust; buying from a dealer who has been in the business and has some expertise   The quality of the transaction is usually in direct correlation to the quality of the people doing the transaction.   If you are interested in a poster, then you ask about condition, you ask for a description. You ask about the price. Is it negotiable? Maybe yes, maybe no. What about a return policy? What about postage charges? Is postage refundable? What are the terms of payment? Dealers may have credit card options like Mastercard, Visa or American Express. A collector is more likely to want cash upfront, but may not have to worry about sales taxes and the like. A dealer operating in the same state usually will. Most collectors are good guys, honest and true. But sending $500.00 or $5000.00 through the mail to someone you never met is daunting. Know who you are dealing with. A dealer who advertises regularly and who has been in business is going to be easier to appraise in this way. A dealer may publish his own catalog; this is very time consuming and expensive and increasingly rare. Many dealers now have computerized databases from which you can inquire by phone.

Buying from an auction house is really bidding. An auction house gets an auction together and publishes a catalog of what will be auctioned. The catalog will publish low and high estimates for each poster - a range of prices in which the poster is expected to sell. Most posters will have a reserve. This is the figure that the auction house and the poster's consignor determined is the lowest price that the auction house will actually sell the poster. Reserves are not published. If the reserve is not met, the poster will not sell. Sometimes the auction house may be approached after an auction has concluded about a poster or lot, that has passed or gone unsold. The auction house may then approach their consignor as to whether the consignor wishes to sell the item at the reserve or some other price.  The auction house usually has a window in the post-auction period when it may sell the lot at the reserve in any event.  But any poster that is purchased in an auction is subject to a buyer's commission. These commissions range from 10% to 15% of the hammer price. That is, if a poster hammers for $1000.00 and there is a 15% buyer's premium, then the actual amount that will be paid to the auction house is $1150.00, plus any additional fees such as taxes and shipping. Shipping charges from auction houses can be steep.

The above are some of the objective concerns of buying. But there are subjective concerns as well. One man's trash is another man's treasure. This is another way of expressing that the concept of value, in poster collecting, is a relative one, and issues of worth are hard to define in terms of strict money. Beauty is in the eye of the beholder.

The subjective factor in determining value must never be overlooked; after all, the objective record of prices realized for any given poster is merely the sum of  a series of subjective value judgments: worth it to whom and when? There are many private sales of many posters. These never become part of the records of prices realized because such sales are generally not publicized.  Nevertheless they nevertheless affect the market.

So how do you know what to pay for a poster? I think you not only keep your eyes and ears open to determine what you might be asked to pay but also I think that you have to ask yourself the same question that the buyer who purchased Frankenstein for $198,000 had to ask himself at some point: what is it worth to me? If you balance these two considerations, you can make a reasonable judgment about how much to pay. You may find a raving bargain in a flea market. More power to you if you beat the dealers to a great poster. Or you may be offered a poster you dearly want by someone you feel may be asking 200% more than you might expect it to be. But do you really know the track record on this poster. And what about your time? Do you have the time and money involved to track a similar copy down? These are subjective considerations that are involved in every deal.

There are some things you can weigh in the bargain:

  • Condition
  • Have you ever been offered this poster before? Have you seen it for sale at what price or have you never seen it for sale at any price?
  • Is it good looking or evocative of the film or personality.

The poster market: selling

You may buy for your own collection or you may buy for investment. Investing and collecting are two different activities. Don't confuse one with the other. Success in one area does not imply success in the other. A collector may be tangentially successful as an investor through a series of happy circumstances. But a collector is really concerned with acquiring items in his area of interest because he admires them. If he gets a good deal in doing so, he has made, in effect, a good investment, providing, at some point, there is an opportunity to sell. Many collectors would never sell what they have acquired. They enjoy their collections. An investor is looking from the beginning for that opportunity to divest; a collector is not. An investor in movie posters is just like an investor in the stock market, only with more risk generally. It is beyond the scope of this article, which must necessarily be focused on collecting, to address speculating in movie posters. It has been done, and done successfully. People have also lost money. If you speculate in posters to finance your collections, you must take the risk involved.

Collectors may wish to sell posters, however, without regard to making a return, specifically, on an investment.

Posters may be sold by advertising them directly in any of the various publications that cater to this activity, such as Movie Collector's World, Collecting Hollywood, Baby Boomer's Collectibles, Hollywood and Vine, Hollywood Collectibles or any number of publications I may have inadvertently omitted. In this activity the seller owes the buyer all the courtesies that he has expected as a buyer: reasonably prompt delivery, a right of return etc.

Posters may be consigned to an auction, if the auction house wishes to accept them. This is somewhat more risky because the seller has less control over what the poster will actually sell for. A reserve will be set. That is the lowest price that the auctioneer will actually hammer the poster sold. If the poster does not receive a bid at least at the amount of the reserve, the poster will pass. In that case the seller must usually pay the auction house something, usually 5% of the reserve or some minimum amount, for the service the auction house has provided in offering the poster during their auction. Of course, the upside of this is that the poster may be sold for more than expected. Read the contracts provided to consignors by the auction house. A commission must be paid by the seller to the auction house. This is called the seller's commission and it varies. Some auction houses have charged consignor's other charges as well. Payment from the auction house comes after the auction on lots for which the auction house has itself been paid. Posters have occasionally been known to hammer for high prices at auction and never actually sell. That's tough luck for the consignor.

Posters may be consigned to a dealer. The dealer, of course, wants to make some money from this, as he should. Details of a consignment must be worked out between the seller and the dealer. Use a reputable dealer; find out for yourself that the dealer is reputable. Sign a contract if you feel it's necessary, but at least lay out the terms of the consignment so that both the dealer and the consignor understand them explicitly. Working with a good dealer can be a very good way to sell a poster that you have without having to deal with the day-to-day inquiries of potential buyers, expenses of advertising etc. The poster may or may not sell right away, but you should have a firm idea what you will get if it does sell. Or if the price is somewhat negotiable you have better control over the deal than an auction consignment. The key to a successful dealer consignment is working with a dealer you respect and who respects you.

Posters may be sold outright to a dealer. This is often faster, but remember the dealer is in business to make money. He has an agenda in this activity as well as you do. He may already have the poster you have to sell - even multiple copies. So he may not be interested in investing in another. Or he may want a certain amount of time before paying. Selling outright to a dealer generally brings in less money than consigning, but there are times when it is desirable. Perhaps you know of something else you want to acquire which is time-sensitive and you need money.

Again the dealer you choose is the most important thing here. Courtesy between the dealer and seller should be a two way street.

These are some of the basics of collecting movie posters. Check out the collector's magazines. Go to a convention. Attend an auction. Get on the phone with some dealers and chat. Call up another collector who likes what you do. Don't take anyone's advice as the gospel, but listen to the experiences of others with an open mind. Treat others in the hobby as you would want to be treated and expect the same.

This is Part Four in a series by Kirby McDaniel of MovieArt for Jon Warren's "Movie Poster Guide". It is reproduced here as a service to collectors with Jon's permission. Click here for Part One.