Here we explain how the catalogue compilers assign prices to stamps they list and why these change over the years.
Catalogue prices can be confusing to collectors at the beginning of their stamp collecting journey, especially when a packet of 2,000 all-world stamps which, catalogued separately, amounts in 'value' to over £100.
At the other end of the scale, the experienced collector usually has no trouble in accepting that very rare items, of which perhaps only two or three exist in the world, can have no fixed value attached to them. It depends on how and when they are offered for sale, how many people want them and can afford to pay for them.
For a start, the prices quoted in Stanley Gibbons catalogues are those at which the stamp dealer would sell the stamps at the time that the catalogue is revised, provided that adequate stocks exist. While other catalogues edited by non-dealers exist, they cannot speak with the authority of 'dealer-backed quotations' based on actual stocks of stamps.
Stamps appear first as 'new issues,' which are usually available from issuing authorities at face value and to which the sellers add handling charges such as postage, poundage, overheads, and so on. Occasionally, stocks of new issues may be too small to supply all the immediate demand. In such cases, the stamps command a premium from the start.
Once a stamp is withdrawn from public sale, prices normally rise because no new stocks are available. The same quantity of stamps is changing hands and copies are being absorbed into collections all the time, driving up the value of the remainder, which brings the first increase in catalogue prices.
Apart from this period of initial issue, five categories apply to stamps in the catalogue.
These are the more valuable stamps of the earliest days of philately, which exist in small quantities and where condition is of paramount consideration. The problems of waxing and waning popularity rarely affect these issues—they have a built-in demand by their connoisseur appeal and their scarcity. The catalogue cannot, however, accurately indicate the value here as a variety of factors are taken into consideration. Some of these include the width of margin for an imperforate, the degree of off-centre perforating of later issues, the heaviness of a postmark or the clarity of a rare cancellation, the degree of wear of the printing plate, or the overall cleanness and freshness of each copy.
Where the classics are the 'blue chips' of philately for the really serious specialist and the top-rank investor, these later rare stamps offer a tremendous field for careful investment. Examples of this type are the stamps of the reign of King Edward VII; they appear frequently at auction or on the open market, and they thus acquire an established price.
Here the stamps are being constantly bought and sold in large quantities, their full potential is adequately assessed, demand is known and is usually stable, and catalogue quotations are therefore well in line with the market. Such stamps are the mainstay of the hobby and deserve a place in every collection. Commemorative stamps of the present reign and such old favourites as the George VI Health stamps of New Zealand are typical examples of this category.
These more common sets offer the more modest collector the chance of really specialised study at small cost, but occasional swings in popularity may bring solid advances in the prices of even such mundane material.
Certainly, a word of explanation is needed where, for example, a stamp exists in large quantities mint, while genuine postally used copies are as scarce as hen's teeth. This is particularly true of certain King George V 'Key Type' varieties, and the reason for this apparent discrepancy is twofold.
First, where the variety is distinguished by its shade or paper colour, used copies may be misleading and so must be regarded as of the cheaper variety; admittedly this decreases even further the number of identifiable used copies available, but it also deters the collector from taking these up when offered—thus scarcity is offset by a very small demand. Secondly, identification may depend on minor differences in the design. Again, these are far more easily distinguished on mint examples, and so again the demand for the used stamps is small.
These are what is often referred to as 'packet material.' When the collector turns to the new catalogues, they will find the figure of 10 pence quoted as its 'value'. Of course, the stamps are not worth 10p each. If you try to sell them to a dealer, you will find that they are not prepared to give them any value at all. Why then the high catalogue price? The answer is simple: it is simply an indicative amount to signify that the stamp in question has no real commercial value. Indeed, many dealers would charge a much higher minimum than the 10p quoted as the 'handling charge'—what it costs on average to check, store, keep, find, identify again and sell to the collector who walks into the shop for it or who receives it mounted up in an approval selection – is far greater than the value of the stamp. If the firm charged less than their handling price, they would lose money on every single transaction.
In every such explanation, there are exceptions, and no editor can be right all the time. Price revision goes on all the time, with the assistance of experts all over the world.
Stanley Gibbons' Auctions Department experts advise on the potential value of stamps, postal history and collections, all while accounting for the variety of factors mentioned in this article.