$100 to GRADE a CARD!!?? What PSA's Price Increase Means to YOU

Well apparently some big news is coming out of PSA. It seems as though they are raising their prices and going full Rolls-Royce mode here. Big price increase. I saw a recent post on slabstox (if you don't follow slabstox on Instagram, make sure you guys give them a big follow). It looks like they're raising their pricing and it looks like right now new pricing going forward is $50 for economy turnaround time, which is currently suspended, so you cannot choose that one right now. $100 for regular, $150 for express, and $300 for super express. That's basically your 45, your 20 day, your 10 day, and your five day turnaround times.

Whoa, I did not see that coming. That is super interesting and exciting, and we're gonna unravel all that today, but I know you're probably a little sticker shocked on that one. Kind of like opening your wallet up after you've been drinking and seeing no money in there. So today's video we're gonna unravel all this here I'm gonna give you my thoughts on it and what it means to you as a sports card collector and investor. We're gonna be talking about the following all right.

1. Why did they raise their prices?
2. The effect on future submissions to PSA?
3. The effect on current cards that are already graded by PSA?
4. What does this mean for other grading card companies?
5. Your game plan going forward.
6. Is this good for the hobby?

Again, these are just my own thoughts here just to get you guys thinking about the hobby, and some different ways that maybe you haven't already considered. Pure entertainment, but this is going to be a good video. I'm going to try to keep it as short as I can, but there's a lot to go through here all right. So let's go ahead and get going.

#1: Why did PSA raise their prices?

So my initial thought when I heard that was PSA views themselves as the Rolls-Royce of card grading companies. They view themselves as the high-end card grading company and I would agree with them. Of course we all know PSA 10s sell for way more than any other card grading company. They are the slab king in the industry. Everybody wants that PSA 10, and they've got a brand to protect and develop. PSA is now a privately owned company. Collector's Universe is the parent company that owns PSA and I think they saw the direction that the card grading industry was going. Where everybody is getting these $2 or $5 dollar cards graded and I think they made a decision to say, “I don't know if that's the direction that we want to take part in. We have in our opinion a higher end brand, and I don't know if we want to be spending our time grading these $1 and $2 cards.”

In my opinion PSA makes their money off of those express and the super express orders. That's where they are making their profits. Yes they're making profit on the slower turnaround time cards, but that's not where their bread and butter is. The bread and butter is the hire end cards that they're getting graded at the super express level and if we take the Rolls-Royce example right. Rolls-Royce could make like a cheaper card and be fulfilling those all the time but is that really the best allocation of their time and their resources? Is that the best thing for their brand? No. I would say with Rolls-Royce they want to make expensive cars. That's the type of car that they want to make and sell, and that's what they want to focus their time on. I think that's why PSA chose to do this.

I mean think about this. They're in California, it's really expensive to do business in California, and if you have to hire less graders and can make the same amount, if not more money, because you're not taking as many cards in, that to me makes logical business sense. You don't have to pay all these wages and health insurance and all this kind of stuff that you have with a huge staff. Now I know they're probably still continuing to hire and they were probably already kind of understaffed to begin with, but that makes sense to me. Have less staff, make the same if not more money, and I would do that if I was the owner of PSA. Why bog yourself down with all these $1 and $2 cards when you consider yourself to be a high end brand. The high end, I mean, is over the $1,000 threshold for cards.

#2: The effect on future submissions to PSA?

So with the economy level being suspended right now (the economy is basically your old 45 day and that's $50 a card) we went from essentially $15 to $50. That's your cheapest option right now to get something graded is a $100. I never thought I'd be saying that for the base level. So how does this affect you going forward with PSA?

Well first off you better be damn sure that the card that you were sending PSA is going to be a PSA 10. You better be doing your homework, you better look at that card, you better make sure that things got 50:50 centering, the corners are sharp, there's no surface issues, the edges are nice and sharp. Now this is going to apply to mainly to the base cards. If you're sending in the LeBron James #221, obviously if you get a PSA 8 or PSA 9 that's fine, but I'm talking about just your lower tier cards. If you choose to send them in with PSA, you better be hoping that you get a PSA 10.

So you've got to be doing your homework on that card that you were sending in. For me personally, I probably wouldn't send in any card to PSA right now that has a resale value of anywhere under $500. Because if you're paying $100 for a card, let's say you spent $50 for the card, so now you're at a $150, let's say you get a PSA 9 which is not out of the realm of possibilities, you're kind of screwed there. So I would personally be focusing on cards to send to PSA right now for future submissions that are over that $1,000 threshold. Like big cards that you can get massive returns on because you are paying a premium now to grade with PSA, and I would probably only be doing premium cards with them. If your flip game is the dollar cards, the PSA get them graded on 45 day and then sell them for $40 or $50; that ship has sailed. You're gonna have to change up your game here. We're gonna talk about that a little bit later on, but that's probably done. The dollar flip card game to get them graded at PSA is out of the realm of possibilities right now.

#3: The effect on current cards that are already graded by PSA?

Those of you who are smart enough to get those $1 and $2 cards done at 45 day levels and are into them real cheap. Those just went way up. Big percentage increase on those. Big percentage increase on PSA 9s. Pretty much most cards under a $100 value right. Ones that people actually want, Jordan, Tiger, Kobe, or LeBron. Those types of cards right? So really any card under $500 had a nice little bump, not to say the cards over a $1,000 didn't have a little bump, they did, but most people that were getting  those $1,000 graded were already paying express level prices to get those things done. So they're already into the grading costs a little bit higher than the $1 and $2 cards that people were sending in. So you've got a little bit of a bump there, but not like you're going to see with these cards that are under $500 and especially the ones that are under a $100.

#4: What does this mean for other grading card companies?

As Snoop Dogg said, “You gotta step your game up man.” This is a huge opportunity for Beckett, SGC, and CGC, huge! This is the opportunity of a lifetime for those card grading companies. I would be so excited if I was one those guys. I hear PSA raises their prices, that's great man, let's compete. Now there's an opportunity to compete on the lower tier cards because if you have a lower tier card and you had an option to send to one of those four card grade companies, you're gonna choose PSA almost every single time. But that’s not an option right now.

Beckett's still pretty backed up but I can see a ton of business coming into them as well, and also SGC and then CGC which is the new card grading company. CGC is the comic book grading company, I'm gonna talk about them a little bit later here, but they better have some solid systems in place. They better be getting close to hitting those turnaround times that they promise people. I think CGC right now has $9 grading for basically the 45 day for PSA. You can go on their website and see what their current turnaround time is, but that's cheap to do right now. They've got a great opportunity here. If you can hit some turnaround times, not make mistakes, and get people their cards back as quick as possible, you can earn some brand loyalty right here. Especially those that are doing those dollar cards and whatnot. They send in a lot of volume, and if you can really earn their trust, earn their respect, and the biggest thing is whether those cards with CGC or SGC will actually sell, I think they will, but a huge opportunity here to really set yourself as kind of the lower tier grading Card Company.

There's nothing wrong with that. Every industry has your higher end, your middle end, and your lower end. I mean look at any industry. You look at framing companies. Big framing expensive ones. You've got your middle. You got your low tier. Supermarkets are the same way, and there's nothing wrong if you choose to be in the low tier end to dominate that particular sector of the card grading industry, and I think CGC's got a great opportunity here. They're fresh, they don't have a past history right now with card grading, and they don't have any bad vibes. I guess I could say they've got a very big opportunity. I hope they are hiring and I hope they got some great systems in place.

#5: Your game plan going forward.

As I've already mentioned, I would continue to use PSA for those expensive cards that have a resale value of over a $1,000. Again, PSA 10s are king. Those new PSA 10 slabs coming out after this price increase I think are going to be very expensive, probably highly sought after, but again these are going to be the cream of the crop cards that you want to be sending to PSA. You got big grading costs, you better be getting big returns on those cards.

I would probably be looking for PSA 10 cards that you think have value. Maybe some PSA 10 rookies that are probably in that $100 to $250 range. I'd probably be picking up some of those. Again, the minimum right now to get a card graded at PSA until they get the economy back in is a $100. So if you can find deals of cards at under or a little bit above a $100 I would find those. Especially rookies in that $100 to $250 range, maybe up to $500 depending on who it is. On the flip side, if you have cards that you graded at PSA and they are PSA 10s right now, and they were those $1 and $2 cards or maybe even the little more expensive ones I would consider raising my prices to reflect the new grading price cost.

If you can very quickly gather your cards and if you can get them into Beckett before they do a price increase, try that. If you like the Beckett slabs and you believe in Beckett get your cards together and get them off to Beckett as soon as possible. I am guessing they're probably going to be doing a price increase to kind of slowly kind of catch up to PSA. I don't know if they will do that or not, but if I were in Beckett’s shoes I would probably be considering raising my prices so I can be in that middle tier. So you got high tier PSA, middle tier Beckett, then you've got your low tier kind of SGC and CGC when it comes to certain cards. SGC does a decent job with some of the vintage cards there, but most people aren't probably going to be sending vintage cards there. Most people are going to send vintage cards right now I think probably to PSA, especially those expensive ones. I'm personally going to be giving CGC a try. I'm not a huge fan of what their slabs look like, but I'm a huge fan of their costs right, and money talks. I think just speaking from my personal perspective, my customers who are kind of gift givers and whatnot, they're just looking for an affordable card that is graded that they can give to a friend or a buddy or as a Christmas gift or whatnot, and I don't think they necessarily require a PSA 10. I think a CGC 9.5 is probably doing just fine if it's priced right and that's just coming from my perspective.

If you're just a collector and you want to have just your cards graded, you really don't care about I guess long-term value, but you don't really care about selling them at all, you just want them slabbed, then I probably go the lower tier routes. You've got SGC and CGC that can probably help you out as well, but again I like CGC. I just think that they have a huge opportunity right now because they don't have any past history. I mean and they're very affordable right now. I think a lot of influx is going to be coming their way.

#6: Is this good for the hobby?

So I was going through PSA's post about this and of course like everything there's so much negativity. People just complaining about stuff that they have no control over. Why would you waste your energy like that? That just makes no sense to me, but I get why people are upset. People get frustrated and they feel threatened and scared when things change. I understand that, but I like this because it's gonna force some competition and force other grading card companies to get better. To kind of seize this opportunity, and again PSA is a privately owned company now, they can do whatever they want. If they want to raise their prices to whatever level they want it's up to them.

I ran an Instagram poll about this, and I actually showed a poll on Instagram recently from Wax Pack (the company that I use for my PSA submission groups) and they ran a poll saying, “What price increase would you feel comfortable with?” and like 90% of people clicked whatever price. So it's gonna be interesting to see how that affects PSA. The big positive I think is it's gonna allow PSA to hopefully catch up on some orders. People aren't submitting as many cards to them right now, hopefully this gets them to finish those 45 day, 20 day, and 10 days that have been lagging behind. Hopefully this allows those to get back to customers who’ve been waiting on those things for up to a year. That's going to be a big plus, but again this is going to create a lot of opportunity for not just the card grading companies but also for you as a collector and investor.

I've already talked about picking up PSA 10 rookies, kind of in the $100 to $250 range, and getting new cards graded with CGC and see if that can create some opportunities for you, but it's going to be interesting also to see how this affects PSA submission groups. If they are not getting as much volume as they're used to, are they going to be able to make the same amount of money to kind of continue operations, and that's going to be an interesting one to watch play out. I don't know how that's going to work out. I think they're probably going to be okay, at least the ones that have a good customer base, but it's going to be interesting to see how they are able to move forward are if they going to be doing less business, more business, only time will tell as this year goes on.

But I really think this is good for the hobby. It's going to give a lot of opportunity to these card grading companies to really step their game up which is going to help you and me I think. That's really the big lesson here. Hopefully these guys are listening and will do their best and have some good systems in place and get their cards back to you as quick as possible because that's what we all want right?

So let's just kind of wrap everything up here. If you're a collector and you like to have your card slabbed and don't really care about the sale prices and all that kind of stuff, I would use CGC okay. Their slabs have like a green color on them, not my favorite, I like PSA slabs and I'm not a big fan of the decimal system, the 9.5 and all that kind of stuff, but if you want to just get them slabbed then do CGC. If you're in the investing game you're going to probably have to change up your strategy here. You're not going to be able to use PSA for those low cards, only those high expensive cards. PSA 10s are still the king of the industry if you can get an expensive card in a PSA 10 slab that's the way to go, and again if you're in the flip game you want to probably be looking into using other grading card companies because it's the cheaper option and they're probably going to get your cards back a lot quicker than PSA.

Again, do I think this is a good move by PSA? Nat Turner, the guy who was the leading the group that bought Collectors Universe, who was the parent company of PSA, he's a collector, he's been a collector for a long time, and I would think that this guy would know what he's doing. You're spending almost a billion dollars for the company, it's not like they spent a billion for this company and then all of a sudden they're like, “What do we do with it now? Let's raise our prices!” No, I think they had that in the works before they bought it so they've had a game plan going on, and again I don't personally know Nat Turner but I've heard a lot of people talk about him and they say he's an absolute genius in the card industry. Obviously a smart business guy if you can afford to lead a group that’s spending almost a billion dollars on a company, so I would give him the benefit of the doubt for this.

Let's see how it plays out for this year. See if he is a smart business guy when it comes to raising these prices for PSA. It may turn out they know something that we don't and this may help overall customer service with them, and make their customers a lot happier and get cards back quicker, and it may be a win-win for everybody here. Again, I think this really opens up the door for some competition and it's going to be interesting to see how that plays out this year in 2021.

I tried to get through that as quick as possible. Definitely a lot to go through. I hope this really helps you guys kind of think about the hobby maybe in a different way, and make some moves. Again, I talked about this in some of my other videos, learn to pivot. Something happens, try something else. It doesn't work out, try something else.