Wednesday, June 25, 2008

Terminology - Approvals

Buying stamps on approval is one way to add stamps to your collection for a modest price. There are many stamp dealers who sell stamps using this method, and a list of approvals dealers can be found in most stamp collecting magazines.

When you buy stamps on approval, a dealer will send you a number of stamps for you to review. You keep the ones you want and return the remainder. You pay only for the stamps you keep.

The benefit to the customer is that he/she previews the stamp before committing to purchase the stamp. They get to look for hinge remnants, stamp thins, or other imperfections. The customer gets to hold the stamp in their hands (figuratively, of course .... always use stamp tongs!).

The benefit for the stamp seller is that they can send excess inventory out to customers, some of whom will keep a stamp once they see how nice it is. The dealer has minimal cost invested in the sending (postage, mailing supplies, plus maybe a little set aside as liability for damaged stamps) and gets stamps under the nose of a collector.

Dealers tailor their approval mailings to customers in several ways. One, they may explicitly ask the types of stamps that the customer would like. Do they prefer new stamps, pre-1940 stamps, stamps of certain countries, etc. They also review the types of stamps that the customer purchases. If the customer repeatedly purchases stamps from 1950s France, a savvy dealer will be sure to put more of those stamps in subsequent mailings.

There are two basic ways to pay for approvals. Historically, the customer would be required to return payment plus any unwanted stamps to the seller after they had selected their stamps. Needless to say, some dealers got stung by unscrupulous collectors who failed to return the stamps or the money. Nowadays, many dealers require that the customer's credit card number is on file and they charge the customer for the stamps as they are sending them out. When the customer makes his selection and returns the unwanted stamps, the customer's card is credited with the amount returned. This keeps the dealer from losing money should the customer fail to return the stamps.

On a personal note, I think it only fair that a customer should have every intention of buying some stamps when they arrive in their mailbox, presuming that the dealer sends good, collectible stamps and not junk stamps. If you are not willing to spend money on stamps, it will waste your time and the dealers time if you can't afford the approvals that are sent to you. Most dealers will want to know what type of collector you are and what you are willing to spend and tailor their approvals for you specifically. If you are a beginner, it is probably of little benefit to you or the dealer for you to be sent exotic or rare stamps. By the same token, the advanced collector will unlikely find anything with inexpensive beginner approvals.

Approvals are a commitment. You commit to looking at the stamps and making your selections in a timely manner, usually 20-30 days. If you are a procrastinator, or are just dabbling in stamp collecting, approvals will not be your cup of tea.

For others, though, approvals are a great way to add stamps to your collection at a very fair price.

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