PSA backlog
 

Does anyone know if PSA has a plan to work through their backlog or is their solution to just “try harder”? If their backlog stays static or continues to grow, that’s nonsensical and seems artificial or intentional. Do they need help with efficiency or debottlenecking? I actually know a guy who helps large businesses with this type of transformation….

All levity aside - I had planned on getting my set graded all by PSA when it was done (which it is) however I’m 36 years old and cannot imagine parting with such a large part of my set for over a year when a competitor does it in 1/12th the time (if I line up for PSA grading and I live to be 80 years old, I’d essentially be giving up my cards for 2.3% of my remaining life, pass on that).

Real curious to hear if they are working on solutions. Thanks!

Yes, the solution has been to lower the submission price thus presumably increasing the flow of submissions and ADDING to the backlog.

Down to just about 1 year behind

It pains me because MY clock starts when the packages were received. I believe THEIR clock starts when they were logged in. And if that is the case, then they aren't going over a year.

My order arrived 3/9/21 and wasn't entered until 4/21/21. It finally moved to Grading, step 4 of 8. I don’t see myself ever using PSA again unless I win the lottery and am able to purchase a Ruth rookie or Wagner T206 and wish to get it in a PSA holder.

I listened to a interview the other day with the new president of PSA. He said that he is hoping to have the 6.7 million card back log caught up by this fall. I guess time will tell. It seems like a pretty lofty goal.

Didn't they say that like a year ago?

They are re-opening the $50 level using queues for people with annual memberships. Limit 5 per order, three orders per customer.
https://www.blowoutforums.com/showthread.php?t=1503413

PSA and the other third-party graders will never completely eliminate backlogs. They need the on deck work, so graders aren’t twiddling their thumbs waiting on cards to arrive.

The issue is reducing their backlog to a reasonable and manageable level. I think I read a few months ago that a 1.5M backlog is the ideal mark.

Psa $50?
 

WOW! 15 cards at $50, I am sure that will make all the 60's-80's psa set registry people send in their $4 commons to help fill holes. Not only that, but they will wait an inordinate amount of time to get 8’s on cards they thought were 9’s and 10!

Don’t disagree that a backlog indicates health however in a sold out business - 0 backlog is always the ideal mark. Anything else is bluster. As a consumer - based on my original post - they are losing my business because of the backlog and technology exists today that’s more efficient and accurate at grading. They use it to grade massive amounts of lumber every single day in the wood industry.

I see the NFFTT strikes again!

This reminded me of the time Yogi Berra was asked if he wished to dine at a highly-regarded restaurant, and his response was:

"Nobody goes there anymore. It’s too crowded."

LOL.

We need more Yogi's in Baseball!!!

You can observe a lot by watching this forum

When I came to a fork in the thread, I took it.

PSA still owns the Market, this will not change one bit.

mhmmm
 

Johnny,

Respect your views but they might have the market for backlogs maybe. I agree they have alot of advantages including the Registry and their sales BUT SGC has figured out the market, took a huge backlog, uses flex pricing, and gets your cards back in a month. Bottom line. Their cards are catching up and just try to buy an SGC T206 for a bargain. Not happening.

SGC is running the show right now. Who really wants to wait a year or more? ugh

Mike

The first company that implements automated grading done by vision systems and computers will take market share, it’s just a matter of time. The technology and demand exist and the whole point of grading is a basis of objectivity. Machines are far more objective than humans.

I agree with you Mike, SGC is catching up, definitely in the vintage market.

I heard today that some guys who sent in giant submissions a year ago, and PSA is finally getting around to grading, are getting hit with 6 and 7 figure fees that they now can’t/refuse to pay because the cards aren’t worth the grading fees. Look out.

I’ve never understood this. What is the business advantage for PSA not collecting upfront fees like SGC? You pay SGC upfront before you even mail it your cards. Who doesn’t like getting paid before the work is even done?

Just think how much money in interest alone PSA could’ve made off upfront fees this past year. Even when submissions were running at just 20 days, why wouldn’t any company want to receive all the money upfront and then earn interest on that money, or use it for other business aspects?

Plus, when the cards are graded, there is not any extra waiting to finally receive the bill, which delays shipping. With SGC, the cards are graded and then shipped. There is no extra invoice step (absent up charges), etc. PSA submitting a bill after grading, takes more time, increases overhead, and is just more work. Surprised Nat hasn’t figured this out. The float is your friend if your a business!

Seems like

This isn't correct. I was just hit with a surcharge for a grading submission to PSA. However, to be honest, PSA was correct in their value estimates for the cards I submitted. It was more that in the past, PSA was more lenient in allowing cards that were over the declared value limit to pass without adding a surcharge, and now they are lot stricter. You are also able to negotiate with them on the fees to come up with something somewhat more palatable. I'm not happy with paying these significant fees, which will impact how I submit to PSA in the future, but to be honest, they were correct in this situation.

MARX cards, very large bulk submitter, is defaulting on the million(s) it owes to PSA. But they took cash up front from their customers and seem to have frittered it away, and can no longer pay for the subs now that the bill came due.
https://www.blowoutforums.com/showthread.php?t=1503473

Josh from PCSportscards (another bulk submitter) posted in that thread that some of his clients have also been stiffing his company by walking away from worthless slabs. The "base card revolution" seems to have crashed less than 2 years after it began.

Did they use their Value guide in determining this? In Bobby's most recent sub ($500 and under declared value) there was an upcharge on 6 cards and using PSA's own guide on the values they were all under $500. Was your card over their value on it?
https://www.psacard.com/priceguide/b...card-values/13

Selling some basketball and football cards for the maximum return timing was crucial. A flipper sent cards to PSA a year ago expecting 20,000 in profit. Just now receiving them back now lost the potential 20,000 gain---even with a few great basketball cards a high grade Bird RC sell prices went from 75,000 down to 30,000. I know a Pokémon collector he breaks out graded cards and resubmits to Beckett, because he likes their holders--its all ones preference- --

I used this from PSA's site when the declared value is understated: Link.

The relevant text is as follows:

"If you refuse, or are unable, to pay PSA for the accurate Service Level, then PSA will return the item to you unprocessed at your cost, and you will be charged for the Service Level at which you submitted the item."

Therefore, I still had to pay the upfront fee for the service level that I submitted the cards at, but I did not have to pay the upcharge. The cards were returned to me unslabbed. Saying that, this had to go through approval at PSA, and they told me this would be a one-time exception.

When I spoke with the PSA rep, we didn't go into how they were valuing my cards, so I can't say with certainty what methodology they were using. I'm pretty sure they were not using the PSA price guide. It seemed more that they were googling the card and checking latest prices for the card at that grade. However, I really am not sure on this part. They could be using VCP for all I know.

They are probably using their APR value, which is the recent average sales price for reported PSA sales. The PSA value is just the old SMR price, which is updated every 10 years or so.

Sent from my SM-G955U using Tapatalk

Even using their APR value there shouldn't have been an upcharge on some of the cards.
One of the cards was a Mathewson white cap in a PSA 2 the APR on that card is $449.99

https://www.psacard.com/auctionprice...ummary/2092813

Let's just be patient. Card grading is a privilege.

Let's just be patient. Card grading is a privilege.

That sale for the PSA2 Mathewson was in 2017. I think we can all agree that prices have gone up significantly since then. Here's a PSA 2 that sold this year for $1375 on ebay. Link. That would be the correct value to use, so the card would probably have gotten a $100 upcharge. I'm not saying I like this, but it is what it is.

Haha, aren't you a trip. That was a 2017 sale. I am guessing the value of that card is slightly higher now. What do you think it is worth today? $2500?

PSA Upcharges
 

The last PSA Submission I received (December 2021) I was hit with an "Upcharge". They sent me a link to a Goldin Auction that ended in October.

That's a Win on the Upcharge !

BTW, PSA has issued a statement on MARX cards here: Link

Well you're the one that said that's what they were probably using for the values.

Looks like PSA is aware the authorized dealer is filing for bankruptcy protection. So the customers get their cards back in whatever state of grading they're in (most ungraded?), then have to fight PSA and others who are also owed money by Marx? Ugh. This may drag on a long time. And PSA specifically didn't say that those cards would be allowed to continue going through grading, just that they would be returned in the most expeditious manner. Many customers will now be out the grading fees (to Marx), with their cards back 1+ years later ungraded and some nearly worthless.

Honest question: what the !*&# is PSA doing? (From a business perspective, I mean.)

Instead of spending years failing to work through the backlog and angering their customer base, why not hire more people and expand their capacity?

Honest answer: I believe they have more than tripled their capacity in the last couple of years, it just hasn't been enough for the market which has grown into base card slab flippers in the same time.
Their biggest failure seems to be keeping low prices for too long, so that the backlog grew quickly to an inordinate pile to ever grow out of.

That’s my take as well. Also, people who say “just hire more people” must not have tried hiring anyone of late…it’s really difficult right now!

I’ve heard guys ask why PSA doesn’t just charge at the time of submission like SCG. Ive wondered the same thing, and the only possible reason I can come up with having something to do with liability and them being able skirt any semblance of legal responsibility for promised services….basically saying we don’t have make good on any promises until payment is collected. Curious to hear other takes, though.

PSA Pros:
1) Charging for the order in advance would make it harder to upcharge customers when their assessed graded card value now exceeds their submission level declared value.
2) They would have to escrow large amounts of money on behalf of customers, maybe? Or at least change up their accounting
3) Don't have to deal with refunds.

Customer pros:
1) You couldn't file a chargeback on a credit card payment if the grading took over 6 months? This is the cluster that BGS has been in for 4 (?) years.
2) Theoretically you could let them keep your cards if you were underwater on them, like sending back your house keys to your mortgage lender during the subprime crisis.
3) Your money isn't tied up.

The backlog was allegedly between 13M and 14M cards. Let’s compromise at 13.5M. Let’s estimate that the average grading fee for the 13.5M cards was $15.00. That equals $202,500,000.00 in upfront fees.

Let’s estimate that PSA could earn just 1% interest on those fees. That’s $2,025,000.00 in yearly interest (free money) just from collecting fees upfront and depositing them into an account. How does this not make sense?

Difficult? CU is worth close to a billion dollars and PSA is the industry leader. We're not talking about a Burger King franchise here.

So there’s several ways to overcome that:
1) pay more to qualified people (raising wages shouldn’t be too hard since they’re a private company now
2) train card graders and incentivize it - lots of good people working in industries still that they’d probably prefer to be a card grader - I feel comfortable on that assumption
3) invest in automation that alleviates the human capacity requirement, decreases cycle time and increases accuracy.

If they aren’t having the above 3 conversations in the c-suite daily they’re doing it wrong.

You’d be surprised how many people don’t want to sit in a dark room for 10 hours a day scrutinizing sportscards for $35k/year.

More so in Newport Beach. Maybe they need an office in Podunk Iowa?

The whole concept of these large group submissions is one I feel PSA should not encourage. By doing so I would think they are providing or at least implying assurances that the authorized dealer will safeguard participants' cards. So it begs the question if they have any liability or responsibility in this instance.

My bigger issue with it is that it creates an "unfair" competitive edge for the person or business who simply has the capacity to create these massive ongoing submissions. PSA was going to get the business from the individuals who make up these group subs anyway. These submitters now get much faster turnaround and they get a price per card that is significantly less. There is nothing stopping me from participating and sharing that edge but I like being able to control my own valuables to the extent that I can. I always worry something like this could happen or that cards gets switched out or there are delays on making the submission, etc. These subs are much different than two hobbyists piggybacking on an order. If my 200 card sub gets to PSA the same day one of these group subs of 5,000 cards gets there my sub is going to be there for months well after the 5,000 card sub has been returned.

It’s not just fast food that’s hurting…try hiring a technician, a software developer, or basically any job up or down the salary scale. Unemployment is at 3.9%.

Higher wages can help…although that usually means higher prices. But we have a shortage of workers globally right now - probably with many contributing reasons.

That being said…PSA is having success hiring…from their website:

“ In January 2020, PSA's parent company Collectors Universe employed 421 team members. Today we stand 783 people strong and growing daily. We’ve been adding more than 2 people per business day for more than 6 months and we’re still going.”

Plus, the modern market has been crashing hard and "investors" of the past couple of years seem over-leveraged in depreciating assets. If PSA hired 1,000 more and bought buildings to put them all in, it may not be the best decision in the long run. They have already announced their intention to open up multiple remote locations, but Southern California is an expensive place to run a company based on near minimum wage labor, with $500K houses the norm.

I have visions of PSA Grading Locations of Texas, Tennessee, and Florida, along with California and NJ for Autographs. That would be awesome.

I totally agree. This gets to the heart of my original question in that it seems then that their decision not to do more expansion of capacity is, in a way, admitting a lack of belief in their own product/service.

Contrast this with the approach SGC has taken, which seems to be "send us all your cards, we want more!"

That’s a really interesting perspective. Hard to not agree with!

If you're having trouble hiring, you're not paying enough. Period. $35k is incredibly low for a business charging $100-$150 per card.

SGC seems to have solved the backlog issue by using the primary economic principle from Econ 101: Backlog gets a little heavy, raise prices a bit, temporarily. Backlog gets down to normal levels, lower prices a bit to ensure steady flow of new submissions.

Result is, SGC can maintain service with reasonable timeframes for their customers, as well as some stability for their own business situation, with the managed submission rate.

Now they just need to establish a registry, preferably a non TPG specific one, to put themselves on even footing with PSA, among the registry crowd.

If they started a registry I would switch all my psa cards (which is 2/3 of my collection) over to sgc. For any sgc decision makers watching.

SGC won't do that, but if Who's Bobby?(tm) of VCP does it, they would be a beneficiary.

I’d have a bunch to cross to SGC as well.

I'm going to push back against this statement. First of all, the max allowed per sub is 500, not 5000.

And yes, I know you probably mean 5000 cards from one person broken down by 10 subs x 500. But I do not think they get done any earlier then the 200 card person, especially these days.

Wonder if the $12-$15 per commons for set Registry Builders ever comes back.

Have worked in small businesses my entire life, sometimes there is no more money

And it's not really a minimum of $100 they're charging right now, since the vast majority of cards still in the backlog are still on $10-15 bulk submissions. And going forward, PSA (Turner) has expressed interest on bringing back much cheaper service levels for set collectors. So this high prices are the only prices phase "seems" to be only a blip.

PSA recently acquired CardLadder.com. I'm pretty sure the primary reason for teh acquisition was to be able to have a real-time price guide for them to use for stuff like this.

Does anyone else think PSA/Collectors Universe could be sold to Fanatics down the road maybe in 3-5 years ?
I have a feeling it could happen and would be huge for the hobby.

That would be awesome. They could make, grade, and sell all under one roof. What more could we as collectors ask for.

I wouldn’t be surprised one bit if it happens.

If they marked the slab with some special label stating the card was printed, slabbed, and sold without anyone having the chance to alter it. They should be able to get a huge premium. Add to that the manufactured rarity they could make beyond silly cash from that service. Why share the profit when they could make it all.

But would they want to admit that 90% of the stuff they were producing was less than perfect? Or would their quality control not permit anything other than 10s to leave the factory?

I can imagine buying unopened product direct from the factory and finding out it had been graded, by them, in the 7 to 8 range.....

Exactly

I'd opined about that in earlier threads/posts and wondered if Fanatics may not just take over the distribution from breakers themselves, and in so doing, maybe bypass the TPGs altogether and offer to slab cards acquired directly from them as "Uncirculated".

But can also see them maybe looking to acquire a TPG as well. No sense in reinventing the wheel, right?

That’s right most likely would be a very smart business move for Mr. Turner he has a great business mind.

I thought they were already heavily invested in CSG as well, or had overlapping ownership groups. I don't see them making a play for PSA, but they could buy out SGC to handle the eBay authentication.

Yup. No conflict of interest there at all...

Some random observations:

Fanatics already authenticates and has the tools to slab:

https://i.ebayimg.com/images/g/wdAAA...3I/s-l1600.jpg
https://i.ebayimg.com/images/g/dZgAA...G3I/s-l500.jpg

It doesn't need to buy PSA, just expand its existing capacity.

PSA has been essentially shut-down for a year. It has distorted the market for slabbed cards and will continue to do so. I think part of the price surge on some sets is lack of additional PSA cards in the market. Pre-pandemic you could send in a standard-level order and have an expectation of getting it back in 30-90 days. Not ideal but not impossible. A business could establish a reasonable flow of inventory by staggering submissions. That has been impossible for a year and doesn't look likely again for at least another year. Clog up the supply chain and it clobbers the whole marketing machinery.

SGC is definitely the main beneficiary of PSA's backlog. If you follow postwar cards at auction you must have seen how many are getting into SGC holders now compared to pre-backlog. I never thought I would see SGC slabs on 1952 T Mantle, 1954T Aaron, etc. It is the only viable established TPG for maintaining any decent inventory flow or for having less valuable but slab-worthy cards encapsulated for auction.

CSG is about to ruin its timeliness reputation with its nutty deal with eBay (see the other thread).

So I agree with you that SGC was the beneficiary last year, but that moreso because SGC was the bandaid because people couldn't submit with PSA. I am very interested to see how SCG does this year.

I recently saw a chart that PSA graded last month more than 6x the amount of cards SGC graded. With the decrease in PSA grading prices, does that continue? We will see.

It's worse for submitters, but much better for PSA.

Years ago I had a very large international company that became a customer for a few months.

They were among the first to abandon just in time delivery on all their parts and supplies and go to an integrated supply model.
Largely because the US plant at least had something like 400 suppliers, and they studied costs of buying anything.
Get 3 quotes
Pick the best one
Get the purchase approved
Issue the purchase order

Apparently the average cost of just issuing the PO was around $400 in the late 90's.
So they first got rid of the places they'd bought a handful of items from. Then the middle size suppliers, and made deals with a handful of large suppliers to buy everything in a category from them at a set markup. Open books on both sides. :eek: At the tens if not hundreds of millions it made perfect sense to issue two Purchase orders a year to six different suppliers. (Their small package shipping alone was in the $40Million range.)

I got on the list despite being small because the head of purchasing was tired of buying a specialized item where he had to tell the seller what page it was on in their own catalog. I knew both our numbers and the big suppliers pretty much from memory. So I saved him a LOT of time.

More remarkably, they paid in 10 days when most huge corporations were holding the money for 90 days because they could.

Can see the sports league and player ownership concerns looking to develop a more vertical organization structure and approach to take advantage of all the potential profit activities relating to their product. They're already doing it with the formation and ongoing operations of Fanatics, followed by the acquisition of licensing rights of the major US sports for card production, and most recently with the acquisition of Topps. So now the sports leagues and players have gained control of the sports card manufacturing market relative to major US sports. Question is, will they try to go even further then and attempt to take over the distribution aspects, maybe trying to cut out wholesalers and breakers. And then expand even further into the secondary market aspects, such as forming/acquiring their own auction house, vault service, and even venturing into the TPG arena. My guess is the sports leagues and players are tired of seeing others profit so much off of what they do and their fame and popularity.

And as for Nat Turner, he would be one of the business people/concerns that Fanatics and their ownership would be looking to possibly supplant or displace, or maybe even just acquire at some point, just like was done to Topps.

Just look at how the various sports leagues are trying to partner up and embrace and align themselves with the gambling industry, all in an attempt to get at least some part of that profit for themselves as well. The difficulty there is in not looking like total a--hole hypocrites who permanently ban people for being involved in gambling and with gamblers, and suddenly doing a complete turnaround and being in bed with them. I guess the thinking is maybe that if only a few people are involved with gamblers and making money off of it, that is the horror and damnation of the respective sports. But if maybe the sports leagues and the players can ALL make some profit off of holding hands and becoming involved with gamblers and the gambling industry, well.......that's maybe a horse of a different color!

Makes you begin to wonder, were the Black Sox players permanently banned because they made money they got from some gamblers, or was it really because they didn't figure out how to have what they did make money for everyone else involved in baseball as well, especially the owners?

I was informed today that my PSA order was being shipped out.
It ended up being way faster than I expected.
Sent in 3 cards at the beginning of the month for their "regular" ($100) service.
They received them on 1/11 and I got the grades today and it moved to shipping complete status.

15 total day turnaround once they received them...I was expecting month(s).

So are most non-bulk subs coming back quickly like this? ^^^^ Or are there still people waiting for regular subs from Oct/Nov/Dec?