Why Coin Distribution is BROKEN!

[Fulvio]

OK, so I've got Goldy on the phone, and we're discussing the Red $2 among other things.

Now, lets get a few facts and assumptions straight...

New coins are bagged by the RAM, put into sealed sacks, palletised and consigned to Armaguard by the semi-trailer load.

Now, if memory serves, last time I went to an Open Day, they were using the bulk tote sacks, and I think I was told they got 25,000 $1 coins into one. That puts the weight at 225kg per pallet, so lets run with that for now until we find out otherwise.

A 40' trailer takes 20 pallets, or 40 double-stacked. I don't know if they double-stack them, but it would be a function of weight. At 38 tons capacity, it wouldn't be a problem, but meh...

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Now, there are 15,000 sacks of red $2. that's 9.9 tons, so basically 1/4 of a truckload. Depending on whether you work it out on the basis of weight or volume, that could be anything from 5 pallets to 40. I'm not going to stack a pallet to work it out, so I'll defer to someone who actually knows the exact numbers.

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The truck goes under armed convoy to an Armaguard depot. Presumably the closest one, which would be Sydney. Its offloaded, and the pallets go into storage. As coins are required by state distribution centres, they get sent truckloads. I remember Armaguard had 11 pallets of Outback dollars at Port Melbourne in 2002, but not what the quantity was.

So, best case, there are 40 pallets, and they get evenly distributed between all the depots. Say 10 depots to make the maths easy, 4 pallets each. if my assumption's wrong, and we're talking 5 pallets total, we already have a problem.

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Once the pallets arrive, they go into long-term storage, and are only released when needed. Let me highlight something to prove my point here...

There are 14 million 2014 ANZAC $1. A year ago, Goldy's wife found three bags at the movies, and snagged them.

I have nearly two sacks at my feet now. One RAM sack packed at 11:11:23 on 15/04/2014, weight 4.59kg, and one cloth sack comprising most of two broken sacks from two other banks. All three of these sacks were delivered by Armaguard LAST WEEK. A year after Armaguard picked them up from the mint!!!!

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To say that the system is stuffed would have to be the understatement of the century. The Mint won't supply you. Armaguard won't supply you unless you commit to $250,000 of armoured car deliveries a year, and then with no guarantees of what you get. The banks for the most part don't know, don't care, and often actively oppose you. And the major retailers either have Armaguard dispensers which do rolls or bulk loose coin, or they refuse to put any effort into cooperating.

So what are we to do? I tackled Ross on Saturday, and while he was friendly and lent a sympathetic ear, the fact is they're running a business. they are a factory just like Ford or GMH, and they make commercial decisions, and screw the customer.

We COULD maybe start a campaign to change things. Even if they just made sacks and bags available at the Mint shop, it would give people a chance, and it would cost them nothing. Or they could reinstate the direct orders. Or they could do more coin swaps or sell baggies *(OR ROLLS), but we saw how those get screwed up, didn't we?

Hell, they even failed to bring any coins to the official launch, which would have at least shown they tried.

Is it any wonder so many people are talking about, or actually, abandoning the hobby, or switching to something else?

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PS: This was written in haste and not proofread, because I'm being summoned to help with some heavy-duty construction. I'll clean up any major errors later.

Edit: Bathroom finished, typos fixed.

[trout]

Why on earth cant RAM make these available to collectors in rolls via their website beggars belief.
Quite frankly the distribution of the new issues has been a "Bloody Joke" over the last decade (Or since the inception of eBay) and is turning many a collector off (Me included) from collecting decimal coins.
WTF is RAM thinking here ?

[Fulvio]

WTF is RAM thinking here ?

To be fair, Ross is walking a tightrope.

• The government wants the mint to be a commercial enterprise, and to make a profit.
• We want decent circulating coins at face value.
• The current situation, as well as any potential outcome, lies somewhere in the middle.

I think they've been stretching the granny bait rope to see where the breaking point is. Once they know just how much we'll stand for, expect things to wind back to a sustainable level at that point.

I also think they've dialed up production to warp factor nine and the crap quality shows. Don't expect that to improve.

If they can see a profit in some policy change or other, I'd expect them to roll with it. Certainly nothing they've tried so far has made them any money, and its all hurt their reputation and driven people away.

The News Ltd coins were done with the specific goal of attracting non-collectors. They want to expand the market dramatically, in the hope that newcomers will be less discerning and less demanding than we are. If that happens, it would be good for everyone in the long run, but don't hold your breath.

If we want things to change, we need to find a win/win, and even then we'd have to fight tooth and nail for it I think.

[Mister T]

As you say, they're a factory just like any other, and most people who use their products don't care what year or design they get, as long as they get something.
But being able to buy small bags would be great - I'm usually happy enough to wait to get the new stuff in change but when I know that won't happen (like with the various commemorative $2 coins) that option would be comforting.

Coin swaps are great for people who work in capital cities and that's about it.

[Ozcoins]

What is the definition of "broken" in this case?
Who is setting the goals?
What are the goals?
Are those goals being met?

[JeffH]

I don't think the system is broken. It achieves the aim of transferring currency to where it is wanted for commercial purposes. If a supermarket orders $1,000 of $1 coins and receives them they don't care what date is on them.
The distribution system is not intended to service the collector market. Any pickups we (coin collectors) make are just good luck. We don't see many UNC coins turn up here and, when they do, they are typically dated two years prior.

For the Mint to expect Armaguard to quickly distribute the red $2 widely across the country was just pie in the sky. There are nearly 6,000 bank branches Australia wide so, with 1.5M of these coins minted, that is 250 coins per branch ($500). A standard Armaguard bag of $2 coin is $2,000 and not all banks are serviced by Armaguard. It just doesn't stack up.
And, publicising it the way they did just created unreal expectations to ensure widespread disenchantment amongst collectors.

The RAM obviously wants to service the numismatic market -otherwise why would they keep producing granny bait and regularly mailing out the "Mint Issue" booklet and order form with the latest offerings. They also have an active coin issue sales network in Australia Post (nearly 4,500. outlets); to say nothing of all the coin dealers.
So there are already systems in place to service the numismatic market.
In the case of the red $2 coin the ball is in the Mint's court. Simply, they just stuffed up (again). The worrying thing is they don't seem to be able to learn from their mistakes.

The mint (like many big businesses lately) seem to forget you need to keep loyal customers happy so they will stick with you. The Mint is (or should be) a nice earner for the government. I think of the profit they make as a tax that people happily pay. Because, the shareholders and the customers of a government owned business are actually the same; us, the people!
Now, where else would you find people voluntarily paying an optional tax?

As to people gaming the system and profiteering; that is always likely to happen while the existing systems aren't being used appropriately. This should not happen but there is nothing illegal about reselling collectible coin for a profit -possibly some rather unethical behaviour in how they are obtained. I just wish I, or some forum member, could somehow get some insider access too so desirable coins could be fairly made available to forum members.

Overall some big profits are being made on the red $2 coin. That is profit foregone by the Mint because they didn't properly think it through.

[Sapyx]

The issue here seems to originate from the policy of the Mints (not just the RAM, but all the modern mints worldwide) of completely separating their Collectors production arm from their Circulation production arm. A coin is either For Collectors, in which case it is made in tiny quantities and sold at a hefty premium through the Mint gift shop and dealer distribution system, or it is For Circulation, in which case it is made in huge numbers and distributed through the cash delivery services which collectors aren't allowed to interfere with. Even for coins where identical designs are issued for both Circulation and Collectors, the Collector ones are specially made - they aren't the same as the ones issued for circulation.

The idea that there might be people out there who want to collect their circulation issues and not their specially-made-for-collector stuff doesn't seem to have occurred to them. I'd certainly pay a small premium for the Mint to have someone stand there on the production line and pick out a coin for me. But I don't want to pay a premium for the mint to set up a special press with special dies and strike a special coin just for me. To me, that's just not as interesting as one plucked at random from the production line.

[Fulvio]

To me, that's just not as interesting as one plucked at random from the production line.

To me, not only is it not as interesting, I don't regard them as coins at all. They're souvenirs in the shape of a coin, that's all.

When NCLT gets spent, and turns up in my noodling, THEN I treasure them, because they have fulfilled the destiny of any coin, and entered circulation. When some bit of granny bait is offered, I ignore it completely, unless something catches my eye as an object of beauty in its own right. Then I might buy it, just to have and admire, but not because its a coin, because it really isn't.

Its a bit like V8 Supercars.. they may LOOK like Holdens, Fords or whatever, but in reality they are nothing of the sort. I had a good look at Dick Johnson's old car minus its skin, and you really wouldn't know what it was. These things are custom built machines, and you could swap skins around and make one into anything you wanted. Which has no bearing on the reality of the cars you can walk into a dealer's and drive off in. When I asked Jack's mechanic what his Bathurst Ford and his same-model daily drive had in common, he thought for a sec, then replied "The badges. And the lights. Everything else is custom."

I like cars I can drive, and coins I can spend. Supercars and NCLT aren't where its at.