It’s a Tough Business

Sports Card Business

Contributor: John McTaggart

I’ve been in this hobby, in one way, shape or form, for almost four decades.

I’ve almost exclusively been in the business side of the hobby, rarely delving into the collector side much at all. 

Now, there were times where I was less involved than others, but I never totally stepped away from the game entirely.

When I started, back in the late 1980s, the process was pretty straight forward — buy wax and break it down, buy singles from clients at about 60-percent of the market value, then turn around and sell at shows and through mail order. 

This model worked and left enough meat on the bone, so to speak, to make the venture worth while from a business standpoint.

For years my brother and I, along with a fair amount of others, worked this method, and worked it well, making a decent amount of money for two kids in their teens and early twenties.

And it was a model that encouraged growth — our single box purchases turned to cases. The weekly local shows became a schedule filled with larger regional ones, and the small local clients grew into a customer base comprised of people from all around the globe.

Now, keep in mind, this was largely before Ebay and online sales, and mostly before the collapse of the entire industry back in the late 90s. 

But, I was there through all that crap, and then when it started to rebound and eventually explode over the past few years.

The New Game

I was talking to a friend recently about the card business, and she wondered how you build a company within the hobby nowadays?

Now, keep in mind, this woman has an MBA, and is the CFO of a fairly good-sized garage door company. She also teaches part time at a major university near me.

I thought about it, and honestly, I struggled to find a clear path to starting up a business in the industry today.

Now, I’m not talking about breakers here, which I could go and and on about, honestly. 

I mean a business where you buy, sell and trade your way into making a living.

Like I mentioned earlier, when I first started way back when, it was fairly simple to do, and in my opinion, there is one main difference between then and now.

The customer.

The game has changed so much since my brother and I started to build ours.

When we started, the overwhelming majority of our clients were true collectors — men and women who purchased cards to add to a collection they were keeping for years.

“One day, I’m going to pass these cards on to my grandchildren,” was not uncommon back then.

Today, the vast majority of people in the market are trying to buy cards from you as cheaply as possible, then turn those cards around for a profit as quickly as they can, only to take those funds and repeat the process again and again. 

The grandkids are rarely in any conversation anymore.

It’s an exhausting and toxic business model where greed is the driving force, not the enjoyment of the collecting experience.

So, in essence, the hobby has become a business-to-business industry, and a cut-throat one at that.

It’s become a culture of consumers consistently trying to squeeze out as much as possible from dealers in order to bolster already dangerously narrow profit margins.

And sites such as EBay have not helped. 

The insane fee structure puts so much pressure on modern trading card businesses that making 20-percent on a card, which use to be acceptable, barely covers the fees these sites charge for every transaction.

And point of entry has become unrealistic as well.

Starting out in this industry the old fashion way, with a few hundred dollars and a dream, is just that now — a dream.

Now, people will say otherwise, but doing it the old fashion way, given the margins being what they are and the fees being what they are, means you’re rate of growth is going to be maddeningly slow, and getting to the point where you are making a living would take years and years.

But, if you can come in with enough cash, you have a shot. 

Buying entire collections, large quantities of wax (if you can even get it), and having the cash in hand to buy larger cards in high grades, that appears to be the ideal point of entry in today’s world. 

It’s sad, really.

Making a true living in this hobby has become almost impossible nowadays for the average Joe.

In a sense, it’s not much different than Home Depot or Lowes eventually driving the local mom-and-pop hardware store out of business. 

Does this mean someone can’t get into the business nowadays?

Of course it doesn’t.

But getting into it and hoping to make a living from it one day— that’s gotten very tough.

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