Royal Mint Criticised for Sale of Out-of-Stock Bullion
SynopsisA recent article on Mail Online criticised some of the The Royal Mint's practices, which includes the sale of out of stock products. While some issues raised are being felt by other bullion dealers, some of the more serious claims cannot be excused, particularly by a Government-owned company like Royal Mint.
The article, written for the website This is Money, points out the criticism the Mint has received by their customers citing a number of instances of late and sometimes damaged deliveries. As the article notes:
“One retired college lecturer from Scotland who alerted This is Money to the problems invested more than £143,000 from his deceased father's estate into 100 gold bullion coins in mid-January, only to be told a month later they were out of stock and he should not have been able to purchase them.”
The customer who paid roughly £2,000 more for “the safety and assurance of the Mint”, was understandably annoyed that the order would neither be confirmed, and would actually disappear from the Mint’s system. After being told that he “should not have been able to place and pay for that order as there was no stock”, the customer was later told in an email that that his order would be delivered ASAP. It would eventually arrive nearly 2 months after the order was placed. Unfortunately, by this time, the gold price had dropped and the value of the coins had fallen by around £9,000.
Not only have there been multiple reports of payments being taken for out-of-stock products, but there have been several instances of problems when products have been delivered. The same customer who had bought £140,000 in gold coins reported that the delivery had been 'poorly packed with the sender's address visible', which would have left a courier with 'no doubt what was in the package'.
Other customers reported that along with the contents being written on the package, some of their contents were damaged.
The article highlights some of the problems facing bullion dealers in the UK and overseas, but also highlights some serious flaws in The Royal Mint’s operations.
Firstly, the coronavirus pandemic created high demand for gold while decreasing its supply. The last time we saw this kind of imbalance was during the Global Financial Crisis in 2008-2009. This imbalance has meant that dealers like ourselves have not been able to fulfill our orders as timely as we would have liked. However, this doesn’t mean that we have not taken steps to ensure that our customers aren’t fully aware of availability and delivery times.
Since the arrival of the pandemic, many of our “Best Value” bullion products have been out-of-stock but we have given our customers the option of buying them subject to an “indefinite” delay, or buying alternatives that we have in stock or inbound to us. To make this as clear as possible, our products either show an "In Stock" status where products are available for immediate despatch, "Add Stock Alert" which means we are out of stock but the customer can be notified when they become available, or an Orderable status. The "Orderable" status is particularly important as this advises customers of any extended waiting periods. The majority of our customers are happy to wait, as we make this as clear as possible upon checkout.
Unfortunately, either through an oversight or negligence, the Mint have allowed customers to purchase out of stock items, which they themselves have said, were out of stock and should not have been able to purchase. Rather than admitting their mistake, or offering alternative products, as per their own terms, it looks the Mint compounded the issue by continuing with orders they were unlikely to fulfill on time.
Some of the delivery problems that the Mint’s customers have encountered are also of considerable concern.
Sending valuable gold coins and bars by post or courier carries some form of risk so not making the contents of the package so obvious to a corrupt courier goes a long way. Likewise, not having such a well-known brand like The Royal Mint emblazoned over the parcel will also help to avoid any expensive losses.
Finally, having your “mint condition” coins and bars delivered only to find that they’re damaged is something that we have come across when dealing with the Royal Mint in the past. Of course, it’s possible that products can be damaged in transit, but in our experience, we have noticed a lack of quality control coming directly from the Mint itself.
Public Perception of The Royal Mint
Being in business for over 1,000 years, it’s understandable why The Royal Mint would be at the forefront of people’s minds when considering buying gold coins. Being government-owned, it also holds a monopoly position and its prices often reflect that.
Sadly, we often find people paying a lot more for precious metals directly from the Mint rather than shopping around to find better deals elsewhere. High premiums and using what we perceive as “questionable” marketing tactics, is something we often speak out against, even though trying to change people’s minds can sometimes be an impossible task.
The recent article pointed out some of the difficulties the bullion industry has been facing since the pandemic hit, but more importantly, it has highlighted some of the issues that we have found with the Mint itself.
Admittedly, the pandemic and its associated lockdowns have caused huge problems in supply chains for many products, precious metals included. The extraordinary demand for gold and silver combined with the stifled production has made things much more difficult for many in our industry, not just The Royal Mint.
That being said, the Mint still have some serious operational flaws that need addressing. Hopefully, the Mint will resolve these issues and improve their customer satisfaction, but if they don’t, there is at least one good bullion dealer out there!