What's the deal with brokers?!?!

[Cadence]

Originally Posted by Cadence

Brokers are salesmen. Unfortunately the honest salesman starves in comparison to the one that gilds the lilly until it comes to repeat business.JMHO

PS, it might not hurt to find out how long the broker had been in business.

[Mike OReilly]

Originally Posted by Dave Lochner

One value of a buyer's broker that has not been mentioned is that brokers often talk to each other and get wind of boats coming on the market before they are advertised.

If the buyer's broker is working for you, he or she can contact other brokers to let them know what you are looking for. Every one wants a boat on the market to sell quickly, no one, especially the owner, wants a boat to run up storage bills while waiting for a sale.

The problem with using a buyer's broker is that it compounds the economic disincentive at the seller's broker end when dealing in the lower end of the market. Now the listing broker is faced with dividing and already small fee in 1/2. If the economics are already a factor in poor service, I can't see how this will enhance things.

I wonder if a seller's broker might even choose to avoid dealing with people who use buyer's brokers. They already seem to ignore, or provide poor service, to a lot of potential buyers anyway.

[Mike OReilly]

Instead of a buyer's broker, who gets paid with 1/2 the commission, why not hire a buyer's consultant. This person gets paid directly by the buyer, usually at a fixed rate.



You are 100% certain this person is working only for you. And it removes any disincentive for the listing broker.

[friz]

Originally Posted by sailorboy1

I have only used 1 broker and used him for both my boats. He was a good honest guy and I got good attention for him.

You have to check into the broker you pick.

Then per chance what his is name? duh. It is a must maligned line of work. Deservedly or not.

[MultiCountryDon]

The lower end of the market gets even less desirable for the broker if:
The broker works for a brokerage "house"-then he gets 1/2
If there is both a seller's broker AND a buyers broker that works for a "house" the split is 4 ways. So on a $50K sale the brokers get $1250.each.
Sorry, but if you are in the under $100K budget on either side of the table, you are not in a priority position.
I have bought and sold many boats both in the USA and overseas with brokers. I guys that I have picked to work with me have been stellular, but the other side of the table have brought some truly poor examples of humanity.
When I sold my Corsair F24 MK II earlier this year, I sold it myself because of the economics stated above. Had some really fine folks come look, had some really scary folks come look. Sold in 3 weeks to a nice home.

Don

[MicHughV]

In my neck of the woods...most brokers know each other, even though they might work for different companies.

The 10% brokerage fee is not that simple....even if only 1 broker is involved, the brokerage house is also involved, and they want their slice of the pie, usually 5%, as they are the one's listing the boat, paying the rent, advertising, secretarial, etc.

Add a second broker, and that 10% fee is quickly whittled down to only a few percent. You, as the buyer's broker are doing all the work, while the listing broker is sitting on his arse, waiting for that commission check to roll in, without taking his feet from the table.
Considering that you, as the buyer's broker, know up front, your commission is likely to be only 2.5% out of the 10, your motivation to show the boat is severely diminished, especially so, on a boat under $100K and especially so, if the boat is not in the neighborhood.
I would not want to take the time to show a boat for a "possible" $2,500 fee unless I had a 100% reasonable assurance you, as the buyer were the real deal. Showing you a boat can be an all day ordeal, plus travel time and that is only the beginning of the effort required to " close" the deal..

And let's face it, there are a lot of " tire kickers" out there, who have no intention of buying a particular boat, but just want to see it.

Brokers can usually tell who the tire kickers are and try to avoid these people as they don't want to be busy showing them a boat while a "real" buyer walks thru' the door. It takes nothing for them to alert another broker, you are not the real deal.

Some brokerage houses will have their "listed" boats nearby, but that is not always the case as some boats may be 100 miles away or more, so there is a cost incurred to show you that boat.

You, as a prospective buyer need to do some homework, before approaching a broker.
Then there is the survey that needs to be done, also eats into a brokers time, getting the boat hauled, arranging financing for the boat, getting it documented, fixing the things that come up in the survey, etc and the final closing day. This is all time required.

So, yes, some brokers are not real personable. Add to that mix, a broker that knows little about the boat and things quickly spiral downward.

You, as the prospective buyer, need to have a game plan. Don't be asking to look at $200K boats, if your budget is $50K, brokers will ignore you. A lot of deals fall thru' a the closing table or at the survey, which means the broker will have zilch to show for his time.

Past boat owners usually have a better time of it than a newbie, because they know the drill.

But just walking off the street wanting to "see" a boat is not likely to get you much traction or co-operation.

And no, I'm not a broker, but I know how the game is played.

[Dave Lochner]

Originally Posted by Mike OReilly

The problem with using a buyer's broker is that it compounds the economic disincentive at the seller's broker end when dealing in the lower end of the market. Now the listing broker is faced with dividing and already small fee in 1/2. If the economics are already a factor in poor service, I can't see how this will enhance things.

I wonder if a seller's broker might even choose to avoid dealing with people who use buyer's brokers. They already seem to ignore, or provide poor service, to a lot of potential buyers anyway.

Good points Mike.

There are incentives beyond the immediate sale of a low value boat that factor into the equation. That low value boat may be the down payment on a more expensive boat the broker is trying to sell. Brokerage will brag about the number of boats sold more than the value of the boats sold. And that low value boat is often the next customer for a high value boat.

Money is certainly a big incentive in the sales business, however, there are other powerful incentives that contribute to a successful business, good will and a big customer base.

When I bought my current boat and sold my last boat, I used the same brokerage. One boat was in the $100K range the other in the $20K range. The brokerage can claim 2 sales and together they earned a reasonable commission. It was also in their interest to have good will in my sailing area and have me say positive things about them.

[shadow]

All good points as this isn't my first rodeo. On one hand, I fully understand and appreciate that it is a business, blah blah blah.. On the other hand, don't they love being around boats and water?! Everyone here is a boat lover and love the sailing lifestyle. You would think that first and foremost, you love being around boats, talking about boats, etc.. Everything that has already been said is fully understood, but think about... So they spend a few days being around boats, the marina, boat yard, etc.. and then possibly only getting 1,500 for their 4 days work.. People! that's not too shabby especially if you love being around that environment, like most here!!

I get that it's a business, but it is a numbers thing.. Even if you spend most of your time being around and talking about boats, why have such a crappy attitude. So you spent a day driving new tire kickers to show a bunch of boats and be around boats and talk about boats.. The worst that could happen is yah, perhaps you missed real clients, but if they want something bad enough, they will call your number and you call them back.. Also, you may have gained new friends and more people to your growing customer base and if they see you love it, they will keep you in mind when they are ready...

Like I implied earlier, if they start getting jaded and guarded, do us ALL a favour and get out and/or just retire.. We need brokers that love it and it shows.. NOT arse clowns that can't even be bothered to reply to e-mails and voicemails.. Give up your seat to someone who actually cares..

[olaf hart]

Marketing isn’t about individual contacts, it’s about strike rates.
Experienced sellers are pretty good at filtering prospects, so if someone is having a lot of problems with brokers, it may have to do with their approach as well.
I can’t recall broker problems buying or selling over the last forty years or so, and that is in a country that only has sellers brokers.
My only sale in the USA went well, it was a lowish price Tartan that went in a weekend, the broker had a fixed , not a variable commission, I was happy to pay for that sort of service.
Some have been very helpful if they sense I am a serious buyer for a particular boat.

[MicHughV]

Nah, it's a job....period....a job. Just like being a car salesman. You have a boss, an office and are expected to spend a certain amount of time there. There is a certain skill and art to it, just like a good car salesman will have, but it doesn't require a University degree to become a broker. Practically anyone can be a broker, though I would say that most brokers have had or do own a boat of some type.

If you expect to make a $100K a year at $2,500 per sale, that would require you selling 40 boats a year. Ha ha, get real, you might sell 1 or 2 boats a month....maybe....if you're lucky....the sailboat market is in the dumps now, so you will end up selling fishing boats at one fifth the price...do the math...remember, you'll be one of many brokers out there....all fighting for the same crumb.

Off course, there are those brokers that deal with the mega yachts, that is an entirely different story. You'd have to relocate or live in Ft.Lauderdale or other mega yacht locale to get into that business and you'd face a long learning curve.

Being a broker, you'll likely hear all the b/s you'll ever want to hear. You'll have to deal with every Tom, Dick and Harry that walks thru' the door...you don't chose your clients...they chose you...

It's a two way street here......

[Mike OReilly]

Originally Posted by Dave Lochner

Good points Mike.

There are incentives beyond the immediate sale of a low value boat that factor into the equation. That low value boat may be the down payment on a more expensive boat the broker is trying to sell. Brokerage will brag about the number of boats sold more than the value of the boats sold. And that low value boat is often the next customer for a high value boat.

Money is certainly a big incentive in the sales business, however, there are other powerful incentives that contribute to a successful business, good will and a big customer base.

When I bought my current boat and sold my last boat, I used the same brokerage. One boat was in the $100K range the other in the $20K range. The brokerage can claim 2 sales and together they earned a reasonable commission. It was also in their interest to have good will in my sailing area and have me say positive things about them.

I agree Dave. As I said, I think there still are exceptional brokers who take the long view when it comes to sales and building relationships. They may not make a lot on one sale, but they may develop a life-long customer that keeps coming back to them as 2-footits creeps in.

Unfortunately, and based on the constant complaints we see here and elsewhere, I think most brokers are taking the short-term view. In that light, it makes sense to maximize profits now, as opposed to some more distant potential income. And I can't fault them for doing so.

My view is that brokers are no better, and no worse, than the rest of the business community. They do hard jobs, and do so even though their incomes are never guaranteed. Commission sales is a difficult world to work in. As anyone who has sold a boat knows, it takes real work. And I've heard it said from brokers that low-end sales can be harder than high end. At the higher end you don't face the seemingly endless stream of tire-kickers and dreamers. So in some ways, a low-end sale can actually take more effort -- but for far less recompense.

Based on my own experience as a small business operator, I know that the time spent on poorly paying work is time not spent on well paying work. There's still only 24 hrs in every day, and often it's better to focus on the fewer higher-paying gigs than trying to squeeze in a whole bunch of lower paying tasks.

This is why I think brokers should just stay out of the lower end market. Either that, or make it the focus of your offering. This in between, where they're just trying to please some sellers, or pad their total sale numbers, does no one any good.

[sailorboy1]

Originally Posted by friz

Then per chance what his is name? duh. It is a must maligned line of work. Deservedly or not.

He retired. Probably got tired of dealing with boaters.

[MicHughV]

I was reading online, where the "average" yacht broker can make somewhere between $50-100K a year, depending on location...that's average.....some off course, do better and others not as good...

That is much better than what I would have anticipated...hmmmmm.....do I see a second retirement occupation opportunity here....nah......it is a seasonal thing though.....you may make a lot during some months and starve the others....

[Mike OReilly]

Originally Posted by MicHughV

I was reading online, where the "average" yacht broker can make somewhere between $50-100K a year, depending on location...that's average.....some off course, do better and others not as good...

That is much better than what I would have anticipated...hmmmmm.....do I see a second retirement occupation opportunity here....nah......it is a seasonal thing though.....you may make a lot during some months and starve the others....

Be cautious there MicHugh. It's easy to obfuscate with averages. A better measure would be the median, or even the mode of incomes. My bet is that these will show that there are a small number of brokers makes a shyte-load, while the vast majority make little.

[MicHughV]

I always thought that I would take on some or other job after retiring.....not so much for the money....but for something to do.....but the longer I stay away from working....the more I like it.....my wife gives me plenty of " honey-do's" to keep me busy.......keeps me occupied when I'm not fishing...

I have on occasion had to be on the road in the early morning or evening and I get snarled up in the traffic jams from people going to and coming from work...and I always think...." I'm glad I don't have to deal with that s--t anymore"...

But, you are right....I know quite a few boat brokers....and I would say that most struggle along...I know only one that does quite well, but he generally caters only to the $500K and above crowd...he often has to fly to one or other location to " show" a boat...like driving to work...flying somewhere for work also becomes a drudge...