Why Are QuestNet’s Gold Coins Expensive?

This was a question raised in the Comments area of a blog post on QuestNet India. Numismatic gold coins are part of QuestNet’s product range, under the JR Mayer Collections brand. Here was the answer given by a fellow commenter and QuestNet IR living in the U.S. (edited for brevity and grammar)…

1. Is there a product with numismatic value which was released for sale & within a few months of purchase, can be sold for a high price? Realistically, a person needs to wait for at least a couple of years to a decade or even more depending on the product.

(Editor’s note: Readers should be aware of the difference between “bullion” and “numismatic” coins. Gold bullion is widely available and traded as a commodity, while numismatic coins are collectibles and released in limited quantities. When the commenter said “expensive”, did he mistakenly compare QuestNet’s numismatic coins to gold bullion?)

2. If you buy a 6 gm gold coin from a jewellery shop, it would probably cost you only 7K, so what makes a numismatic coin costs 30K?

a. Numismatic products have artisitic value, hence higher costs of craftsmenship.
(Editor’s Note: QuestNet’s coins are minted in B.H. Mayer’s Mint - established since 1871, it’s the oldest family-owned mint in Germany.)

b. Every edition is endorsed by the owner. A company cannot just put somebody’s face on a coin. They have to get permission from the respective person or body, and we need to pay royalty for that. For example, the Mother Teresa coin was endorsed by UNO-FAO, while the Shivaji coin was endorsed by Shivaji trust.

c. The gold which comes out to India from Hong Kong has to be accounted for by the World Gold Council and hence, there is an administrative fee charged.

3. There are logistical (e.g. packaging and handling charges), insurance and the usual overhead costs.

4. Profit markup - no company in the world does business without the aim of profiting. However, a portion of this goes to RYTHM Foundation, QuestNet’s charity arm, for their work. For example, we helped the Tsunami victims in Indonesia, sponsored underpriviliged kids to experience the FormulaOne in Malaysia and donated to UNICEF in India to support their programs for the flood-affected districts in Bihar.

5. Referral commision to our Independant Representatives (or IRs …we don’t like to call them QuestNet members) as per the network marketing model.