Bad Market - Good Negotiation Strategies ?

[ice]

Originally Posted by Ex-Calif

Free market economies. Buyers buy and sellers sell. No one has a gun to their head.

The ethics discussion is confounding.

My dad was literally begged to buy an airplane off a friends widow.

If you went back and read my posts more carefully, you would see that I very explicitly agreed with you that situation was an honorable win/win.

In my first post I was trying to comment on a very specific type of situation, but my writing was apparently unclear. I was reacting to some implications that you could and should go around offering 50% of asking price. In some situations 'offers welcome' that is fine and a win/win, but in most situations I was suggesting it was polite and honorable to be upfront early in the process that was your intent.

Lets just say the situation is this . . . I put my boat on the market with a clear published asking price and description (and the boat is in fact as described). Someone comes and asks all sorts of questions multiple times (many requiring some research), wants to be shown thru the boat, etc. Then that person offers well below the asking price, despite the fact that the boat is exactly as described. It becomes apparent that person never had any intention of offering anywhere near the asking price and did not have the budget to be near the asking price. I do not respect that practice. If that person had said right up front "I like your boat but can't come to your asking price, are you willing to consider a lower offer' - I would have found it perfectly acceptable, and I could have said yes or no. Or if that person had come in with the ability/intention of being near the asking price assuming the boat was pretty much as described but found major defects that he could not have expected, then a lower offer is also of course perfectly acceptable (But as a note: I don't find "the engine and rigging might have to be replaced because of their hours/age" is not a 'surprise' when the boat's age and engine hours and refit history were public knowledge from the start and they are in perfect operating condition).

Some of you are saying 'well you don't have a gun to your head and can say no to any offer'. Yes, true, but I have wasted time and effort and energy with the assumption that the 'buyer' was somewhere in the same ballpark as the public asking price.

As to "widows and daughters" . . . I come back to the golden rule . . . treat them as you would like to be treated. In the very specific case you describe, obviously a 'low' offer was good for both parties. But in other cases you will simply have to make your own decision about making some money by screwing over another human, rather than helping/educating them.

[David_Old_Jersey]

Originally Posted by Sand crab

I'm reminded of the recent similar thread about how much to offer on a near new Outremer 49. Posters were saying knock 30% to 50% off of asking and I was saying "not on that boat". Well that strategy must not have worked because that same boat was at Strictly Sail Miami recently still for sale.

I think I was one of the 50% off crowd . and I recall that was a few months back.

Could be that they knocked back all lowball offers, or on the other hand maybe no offers at all....limited market for one of those even at the best of times, which following the dissapearance of easy credit got a lot smaller.

FWIW, I'm down to double digits .

[Ex-Calif]

Originally Posted by ice

If you went back and read my posts more carefully, you would see that I very explicitly agreed with you that situation was an honorable win/win.

In my first post I was trying to comment on a very specific type of situation, but my writing was apparently unclear. I was reacting to some implications that you could and should go around offering 50% of asking price. In some situations 'offers welcome' that is fine and a win/win, but in most situations I was suggesting it was polite and honorable to be upfront early in the process that was your intent.
.

I completely respect your position in selling your boat. I agree that being up front with the seller is important.

On the other side of this coin is the more lookers the more opportunity. A lot of folks don't know they can and will spend more than they planned to. I've seen many folks fall in love with a boat and pay too much.

There is huge variability in boat proces for the same or similar boats of the same vintage. I posted previously in this thread or another about the 65k Hunter and the 75k Hunter. They are at my club on adjacent morrings. Everyone wants the 75k boat for 65k. The 75k boat has a better fit out and is worth it. In actuality having these two boats side by side is hurting both sales. The buyer "sees" the Hunters as 65k start point and down from there. That hurts the 75k guy. The better. Oat hurts the 65k guy because everyone is holding out for the 75k boat to drop in price.

Both boats have been on the market a long time. At some point one or both of these guys will take a lower price. One guy has already left the country and is now selling by remote sale. The other guy already has his new boat.

I did not create the circumstances for either of these guys. Is it wrong to put a standing offer of 45k? I think not because when and if the seller is ready one or the other will sell.

The buyers risk is that someone will come along and pay 65k or 75k - but that is how it works.

If I were either one of these guys I would like the lowball standing offer in hand knowing I can get out if I have to. BTW they are both my friends and I haven't an interest in either boat but it will be interesting to see how these sales play out.

[Sand crab]

Originally Posted by David_Old_Jersey

I think I was one of the 50% off crowd . and I recall that was a few months back.

Could be that they knocked back all lowball offers, or on the other hand maybe no offers at all....limited market for one of those even at the best of times, which following the dissapearance of easy credit got a lot smaller.

FWIW, I'm down to double digits .

I don't know about that. I read that they had just delivered hull #20 of the 49s. The first year was 2010 for this model. That's 20 million dollar boats in just over 2 model years. Very impressive. I also read that they had presold 5 of the brand new 5Xs. They just launched #1. They are north of $1.5 mill. Sucks to be Outremer. NOT

[David_Old_Jersey]

Appreciate that our positions will never reconcile - but I do enjoy flogging the odd dead horse (one careful owner - stick by seperate negotiation )............

Originally Posted by rognvald

There is, however, in other cases an honest and straightforward approach to the deal where both the buyer and the seller are aware that a low offer is going to be made up front which gives the seller an opportunity to kill any pending negotiations or wasted time and effort if he is not willing to consider the offer.

Most people who see an advert for a boat do immediately convey their offer to a Vendor - by offering nothing at all. Saves time for both parties .

Until a Buyer has had a good look at the boat in question they simply have no idea what it is worth to them (and odds are strong that a Vendor has little idea what the boat is really worth either). Until teleport is invented someone on the Vendors end (maybe the Broker? ) needs to get off backside to facilitate that. Showing the boat to folks who do not buy (for whatever reason) is just a cost of doing business......and that's what folks pay a Broker for (or at least what the Broker should be doing for them).....after that, considering a ballpark offer (within a week?) ain't exactly hardwork for a Vendor - is it?

Unless the boat advert says "firm" or "Non-negotiable" after the asking price then it is expected that the price will be subject to negotiation......after that it is a question of how much off. I can understand that to some Vendors 50% off is a lot, but not so much if they loaded the asking price by 25%. If a Vendor wants a quick and effortless sale, stick it in an auction (e-bay) sold unseen......

And, contrary to a previous respondent's comment that professional buyers are using another person's money, it disregards the millions of small business owners across the country/world that buy and sell on a daily basis for profit. Their successful negotiations depend upon their honesty as a seller or a buyer whether its a one time sale or a long term relationship.

I didn't ignore them - points 3, 4 & 5 cover that. Those business owners who are good at that survive. But many don't........and just because someone is good at buying tins of bean (or whatever) don't mean they are any good at buying bunches of bananas (or vice verce ).

Donald Trump, the American billionaire, has a reputation as a hard bargainer. He also has a reputation as a fair and honest businessman that produces a quality product . . .ergo, his success and appeal of his brand. On the other hand, you have the duplicitous Bernie Madoff who through deception and sleight of hand accumulated millions of dollars as he destroyed the lives of all those around him. His product and brand were junk. His fate was sealed by his business tactics.

Never met Donald Trump nor done any business with him (different social circles!) - but from the bits of TV I have seen (I appreciate that TV is not real) he is someone that if he told me the time I would check my watch.....make of that what you will.

Bernie Madoff on the other hand is a classic example of folks giving money to someone based solely on trust and without understanding the product.....kinda like some folks when buying a boat . I have zero sympathy for anyone that Bernie Madoff conned.....and FWIW his fate was not sealed by his buisness tactics - it was sealed only when the wheels fell off the great con trick that is the Western Capitalist System (and I speak as a beleiver in the power of Capitalism and the benefits off ($$$) to both me and to wider society).

The point is that how you negotiate is a direct reflection of who you are as a person. Contrary to the "Blue Collar/Working Man's" stereotype of the dishonest, shady salesman/businessman who hoodwinks his unsuspecting customers for financial gain, the key to successful dealing for most in both a business and personal sense is to be honest and straightforward and the rewards will be forthcoming.

I confess to loving a good stereotype - always fun to play with the expectations of folks who can't think outside (own) box.

Odd as it may seem?, I do agree that an honest and straightforward approach brings it's own rewards......but the definition of those things does vary (in both business and personal sense), usually in the favour of the one doing the defining.

Funnily enough one of the things that has worked for me well over the years is helping folks out for absolutely no reason at all - save that I can (and for the enjoyment of watching the cogs turning by folk trying to work out my angle )........... "You ask me why? - I asked why not?" . Does not always get appreciated as it might , but that's just people for ya .

What do you really have to lose?

Money. Mine....."your" money I am not so concerned about.

[Celestialsailor]

Originally Posted by ice

Just a comment to all those suggesting low ball offers . . . if you are intending from the start to make a low ball offer, and you expect to take seller's time and energy and access to his boat, I urge you to communicate your intent (to offer well below the asking) to the seller early in the process. I personally feel that is the ethical and honorable approach. Remember the golden rule. Ethics and honor may be old fashion and not in vogue in a 'buyers market' but I hope we as all sailors together can be decent with each other.

There is an asking price, and my personal feeling is that you are being deceptive if you look over the boat with no intend ever to offer anywhere near that price, without mentioning that to the seller at the start.

Some sellers just want an offer and they will let you know that - "sure please look at the boat and let me know" while many others have made a serious calculation about their asking price and want/will only take something near it. You can determine which is which early and not waste your or their time.

Ditto on this one. It seems a new breed of buyer these days. Of course brokers never seem to change (See attached photo of 2 brokers)
I sold my Rawson 30 Pilothouse last year. I must have shown it 3 times a week for 25 weeks. I became very shut down and robotic when I showed it. I was asking 1/2 of current value based on some deck issues. In the end, sold it for 1/3 the value.
From that experience, when I walk the dock and hear "Boomer McBrag" talking it up how they sleazed a boat out from under someone, I just walk away. I don't want friends like that in my life. The boat I have now, Karma played a big roll. A French/Canadian guy was going around the US buying up boats in distress situations. He bought it from an Estate sale from a family member that was not a boater. He actually admitted to me that he found a surveyor to "go hard" on the survey. I read the survey. Things like..."No fuses on DC panel". They were right there in plane view. He hired a diesel mechanic and had written up that it needed a new engine...$13,000. Then......the F/C's wife told him she was leaving if he didn't get rid of the boats. I didn't even get a chance to make an offer. The fact that I was looking at it, he dropped it back to the price he paid for it and I said, "sure".
In the past, when buying a boat, I just sit down with the seller and talk story for awhile, so both of us get comfortable. I never down the boat and I praise work he has done. I usually get it for a fair value. Especially when the prior owner has emotional attachment to the vessel and wants to see it survive.

[Multihull]

Originally Posted by Sand crab

I'm reminded of the recent similar thread about how much to offer on a near new Outremer 49. Posters were saying knock 30% to 50% off of asking and I was saying "not on that boat". Well that strategy must not have worked because that same boat was at Strictly Sail Miami recently still for sale.

The funny thing is that that particular boat was for sale in sxm for 1.040.000 USD.
Now in Florida the asking price is 875.000 USD
Down 15 percent and still not sold.

Rob

[Sand crab]

Originally Posted by Multihull

The funny thing is that that particular boat was for sale in sxm for 1.040.000 USD.
Now in Florida the asking price is 875.000 USD
Down 15 percent and still not sold.

Rob

With two 2011 boats at 985K and 937K it's hard to justify a 2010 at 1040K. Now I think the price is realistic. Still ain't gonna get one for 500K.
I was incorrect when I said the first model year was 2010. It was 2009. Impressive build number nonetheless.
However, as I said on the other thread if the boat you are considering is a more generic boat go for the best price. If it's a Swan, Oyster, Outremer 49, Catana 50, etc. then a 30% off offer is a waste of time.

[Lagoon4us]

We have spent the last 3 months searching for a Lagoon 440 Owners version. Using the internet we inspect the proffered photo's and inventory.

If a boat interests us more we ask for more info, then more again. At that point i tell them straight- "Based on what i see in what you've told me we would only be able to look at this boat based on a price of such and such.

The reply usually takes some time as the broker contacts the owner, i'd say most f the time the reply is yes. We also tell them we will be travelling to their country at susch and such a time so if sold prior then fair enough. The price usually goes down by 20+%

We also told them we had others to view, nothing like taking away any delaying tactic's on their part.

Within a month we shall move aboard not sure whether in USA or the MED it depends on final negotations.

We sold our family house to get to this point every $1,000 counts.

Cheers

[cat man do]

You're not buying friends, you're buying a boat.
That boat is only worth what the market is prepared to pay.

If the broker can't get what the owner wants they should not have lied about what the attainable price was in the first place and the owners should re-negotiate the % of the commission paid to that broker.

[Lagoon4us]

CMD I've noticed brokers tending to remove the dinghy from the boat and offering it as "can be purchased separately" ...

Also i find the price is padded by the broker to maintain the "YACHTWORLD" pseudo value because once sold you cannot find out the actual selling price hence the market is false.

On our style of boat the actual market is around 20% lower.

Brokers are i guess basically honest BUT they are middle men just the same and as you correctly say "you ain't buying friends!"

Cheers

[downunder]

Originally Posted by Lagoon4us

CMD I've noticed brokers tending to remove the dinghy from the boat and offering it as "can be purchased separately" ...

Also i find the price is padded by the broker to maintain the "YACHTWORLD" pseudo value because once sold you cannot find out the actual selling price hence the market is false.

On our style of boat the actual market is around 20% lower.

Brokers are i guess basically honest BUT they are middle men just the same and as you correctly say "you ain't buying friends!"

Cheers

You last two posts are excellent and your comments are real as you are a real buyer and doing it at the current time.

Valuable comments thanks

[Doodles]

Originally Posted by Lagoon4us

CMD I've noticed brokers tending to remove the dinghy from the boat and offering it as "can be purchased separately" ...

Also i find the price is padded by the broker to maintain the "YACHTWORLD" pseudo value because once sold you cannot find out the actual selling price hence the market is false.

On our style of boat the actual market is around 20% lower.

Brokers are i guess basically honest BUT they are middle men just the same and as you correctly say "you ain't buying friends!"

Cheers

Yes, you can find out what it sold for. Any broker with a YW account can look it up on Soldboat.com, another arm of YW.

As for "pseudo value" I think everyone these days is expecting a big discount, given and taken, so they are pricing boats accordingly. If I had a boat to sell I'd sure list it at least 20% higher than what I expect to get ... wouldn't you?

[avb3]

Originally Posted by David_Old_Jersey

............
Unless the boat advert says "firm" or "Non-negotiable" after the asking price then it is expected that the price will be subject to negotiation......after that it is a question of how much off. I can understand that to some Vendors 50% off is a lot, but not so much if they loaded the asking price by 25%. If a Vendor wants a quick and effortless sale, stick it in an auction (e-bay) sold unseen......
......................

"Firm" etc. means nothing, as it doesn't write any checks that can be taken to a bank. Some seller think that it gives them an air of authority; some buyers like me think, "Their desperate".

I have bought hundreds of "firm" priced cars in a past life as a dealer. Sellers like cash, and if you show them cash, most will bend. I often tell those "firm" types that if I come to see the vehicle, I will make a fair (and mean it) market offer to them. That offer may or may not be at their "Firm" price. If their interested in cash today, let me know. If their interested in staying "firm", call me if you change your mind. I also let them know the market may have changed if they call, as their car is not like whiskey, it doesn't get better with age, so they may want to take that into consideration.

Boats, pretty well the same thing. Unless there is a gold brick under the sole, "firm" is only a negotiation attempt by an amateur.

[cat man do]

Originally Posted by Doodles

Yes, you can find out what it sold for. Any broker with a YW account can look it up on Soldboat.com, another arm of YW.

Then they should be able to provide comparable sales details on comparable vessels to support the price asked.

As for "pseudo value" I think everyone these days is expecting a big discount, given and taken, so they are pricing boats accordingly. If I had a boat to sell I'd sure list it at least 20% higher than what I expect to get ... wouldn't you?

I'd tell 'em their dreamin' and walk away.

Tell 'im 'e's dreamin' - YouTube