Talking Shop with Mike Sprouse of River City Coins
Monday, March 25, 2013
Running a small business is tough, but Mike Sprouse of River City Coins & Jewelry wouldn't have it any other way
Mike Sprouse has operated River City Coins & Jewelry for 27 years. Aside from successfully operating a small business, Sprouse also has been a banker and economist. He shared with us his thoughts on business and the economy.
Q: What is River City Coins & Jewelry?
A: I opened in 1986. I turned a lifelong hobby into a profitable career, and am loving every minute of it. Cape Girardeau has been good. It's a decent place to raise a family, there's a diverse economy and stable economic base that doesn't go as far down as the recession. Customers come in from around the country, and can't believe we're here instead of in some big city and it's worked out well. I've been at this location since February 1993. Before that I was on Independence Street for seven years. I have the advantage of having a unique status here. With rare coins, customers won't let distractions keep them from coming in.
When Broadway was under construction, we had customers buying from our website and eBay store, and that compensated for the construction. We've had a website since 1999 and it does extremely well and grows every year and may surpass the store volume.
The last few years have been spectacular. The price of precious metals and collectible coins has gone up and interest has gone up. That's helped us through the tough economy. I had customers who lost jobs at Florshiem, Dana Corp and Thorngate who brought things in they couldn't afford to keep. I have steady buyers, and business has been good. You can't get what I offer anywhere. The good citizens of Cape Girardeau, Bollinger and Scott counties trust a local guy. I have a well established reputation and get good referrals.
Q: You have a degree in management and economics, are a school of banking graduate and were a commercial banker in Memphis. What made you become a professional coin dealer?
A: I was a banker for 10 years. I always wanted to be a banker when I grew up. I grew up in Hayti, Mo., was raised by my grandparents, and I saw bankers always lived well. Part of that is because they understand how money works. Then I married a local. I collected coins since I was 12, and was always interested in coins. I was in the Memphis Coin Club as the treasurer. When I was banking, I got called on to evaluate coin collections for a fee. There was another coin dealer who would overvalue collections, and people would end up getting less money than they expected. I would give people honest appraisals and became established. I would make offers to people when I would appraise their collections. I would buy estates. I became disenchanted with banking. Thomas Jefferson once said, "Banks are more dangerous than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered."
I thought I could make a living doing this. We had our first child and moved here to raise a family. My wife told me to get a real job, and banking didn't appeal to me. I got the opportunity to buy out a retiring dealer in a turnkey business and opened shop in 1986. It was tough the first few years.
Q: The last few years have been hard for small businesses. What have you done to survive in a difficult marketplace?
A: We expanded our Internet presence with the downtime we had during construction. I couldn't handle it all so I hired help. Bill came to work a couple of years ago and we opened an eBay store. We can buy more stuff than I can sell. We have an easy-to-find website, and on the eBay store we can sell around the world from here. We have a well developed website. For silver art bars we show up at the top of any search engine. It's a unique time; jewelry sales have been bad but gold and silver sales have been good. People have been cleaning out their jewelry, and we've been able to turn a profit and reinvest.
Q: The price of gold has roughly doubled since 2008 and is about four times what it was 10 years ago. How has that affected you? Your customers?
A: It's been very positive. Inventory and net worth and interest in gold have gone up. It wasn't even thought of as an investment five years ago; now you can't turn on the news and not see ads for gold investment everyday. Gold has been getting more attention, and we've been buying and selling more.
Q: Many people talk about preserving their wealth in gold. Is that a good idea in uncertain times?
A: Gold and silver are true money in the economic sense of the word. They have store value, standard value and are used as a medium of exchange. Gold and silver have thousands of years of history as money and are treasured and accepted around the world. Once a currency has been debased, power flows where it's stable. Gold and silver are not so much investments as a way to keep the money you've all ready made.
When I was young, a silver half-dollar would get me a Coke and popcorn at the movies. Today that same half-dollar is worth about $8, and that same $8 will get me a Coke and popcorn at the movies, so its remained stable. It's the true definition of money that people will exchange. It holds a standard of value and maintains purchasing power as currency fluctuates. Gold and silver can be used to compensate for losses. A small investment in gold or silver can offset losses because they tend to run counter to currency.
Q: What do you enjoy about doing business in Cape Girardeau? What is challenging?
A: There's a wide economic base and diversified economy. We have more options for dining or entertainment than anywhere between Memphis and St. Louis. What we sell here are luxuries, and it's a luxury to be in a place that has it going on economically.
One challenge would have been the pawnshop ordinance. It would have been impossible to document, photograph and record everything we buy and sell, and have it readily accessible by the end of the business day. Other businesses didn't know that was going to happen. I was pleased the city listened to our concerns and cooperated to be helpful to business. I was grandfathered in. They have been cooperative and have corrected problems in short order. The city is positive to business and to improve business.
Q: As an economist and as a small-business owner, what advice would you give to budding entrepreneurs?
A: Hang in there. With taxes going up, Obamacare and regulations coming down the pike could strangle small businesses. I work harder for myself than I would anyone else. I've had to put in 60- to 70-hour work weeks, and you have to when you're self-employed. You have to get up and work and exercise common sense. I can't think of any type of business than this to be in.
River City Coins & Jewelry is located at 713 Broadway and open 9 a.m. to 5 p.m. Tuesday through Saturday. More information is available online at www.rivercitycoins.com.
Pertinent address: 713 Broadway, Cape Girardeau, Mo.