Ethics of negotiation

[pjbori]

Hi sailors!

I'm looking at buying a 1977 cruiser in a relatively decent condition, selling under 13000 euros. Apart from obvious negotiation points due to stuff that needs fixing, what is the common practice in making a bid? I read somewhere that it's perfectly acceptable to go 30% below the asking price as a first bid, but that seems like a stretch as I wouldn't want to 'alienate' the seller either.

What's your experience?
Cheers!

[letsgetsailing3]

If you want this boat, offer what you feel is a fair price. If you just want a good deal, and you don't care if you get this boat, feel free to low ball.

At that price range, is it really worth alienating the seller? This is the risk. Generally, there is benefit to you in coming out of a transaction with both parties feeling that they've been fairly dealt with.

Sometimes, the seller has more equipment at home, some discretion in leaving things on the boat, or you may want to know you can call them up in a month or two with a question and they'll be a lot more helpful if there's good will left in the relationship. This favors a positive negotiation.

The bottom line: treat the seller like you'd like to be treated. There's no formula.

[mvweebles]

Originally Posted by letsgetsailing3

If you want this boat, offer what you feel is a fair price. If you just want a good deal, and you don't care if you get this boat, feel free to low ball.

At that price range, is it really worth alienating the seller? This is the risk. Generally, there is benefit to you in coming out of a transaction with both parties feeling that they've been fairly dealt with.

Sometimes, the seller has more equipment at home, some discretion in leaving things on the boat, or you may want to know you can call them up in a month or two with a question and they'll be a lot more helpful if there's good will left in the relationship. This favors a positive negotiation.

The bottom line: treat the seller like you'd like to be treated. There's no formula.

This is a great response. Too often these threads devolve into chest-thumping/ham-fisted suggestions on how someone got a great deal by lo-balling or something. Older boat values are much more price-sensitive to condition and equipment than cars. If you find a boat with newer rigging, sails, engine, dodger, etc., there's no sense low-balling by saying there's a similar boat cross-country that has been sitting moss-covered since the Obama administration.

What's wrong with trying to figure out what the boat is worth and seeing if there's a deal to be made at that price point? Regardless, unless a seller is really hard-up, a 30% drop (plus the 10% to a broker if it's broker-listed) will be a tough pill to swallow. Don't get your hopes up for a counter-offer or a good-karma sale if that's important to you. If you think the boat is over-priced, ask the broker about the price rationale - tell them you like the boat but there's just too much daylight between the seller's price and what you're willing to offer so while you're interested and the boat ticks a lot of boxes for you, you will keep looking. But keep you posted if something changes - it's a great boat, just rich for your blood right now.

More flies with honey than vinegar.

[Knotical]

Originally Posted by letsgetsailing3

If you want this boat, offer what you feel is a fair price. If you just want a good deal, and you don't care if you get this boat, feel free to low ball.

I agree with above but would advise not to get too emotionally attached to a boat (believe me it is very easy). I placed 2 low ball offers and ended up paying just a little more than my initial offer for my current boat. The other boat's owner rejected my offer initially but then called me a month later willing to accept but I had already bought my boat by then - their loss.

Unless you have a personal relationship with the owner I would advise to place as low an offer as you think is worth and see what happens, mooring and yard fees add up quickly and you never know how motivated a seller is. Also, get an offer accepted prior to survey and then you can re-negotiate based on the survey (its what I did).

Good luck.

[Tillsbury]

Also depends where the seller has been with their price. Sometimes when a boat is new on the market the price is hopelessly optimistic and 30% off is reasonable. Often after a few months the seller drops the price significantly (or the broker finally convinces them of reality), and once that's happened another 30% might be somewhat ridiculous...

Work out the value of the boat to you and go in honestly.

[Knotical]

I just saw mvweebles' post and want to respond to it -

I agree that you shouldn't piss off the broker or seller, we are talking about a pleasure activity after all. My conversations with them were very cordial and respectful and I still talk to them, in fact I called the seller a few weeks after the purchase with docking tips and he offered to come and teach me, and he has an open offer to go sailing with me whenever he wants.

Point is, you definitely want to have a fair assessment of the boat's price before placing an offer but if you think it's 30% lower than what the seller is asking don't be afraid to offer 30% lower, there is no reason to give away free money.

Btw, I paid 23% lower than the asking price.

Cheers.

[pjbori]

Thanks for the replies. The boat is through a private seller and it's a boat that I've been able to find very little info about - there's only one other one for sale currently in Spain, for double the price, but also in a much better condition. So kind of difficult to figure out what it's worth...

[mvweebles]

Originally Posted by navdi

I just saw mvweebles' post and want to respond to it -

I agree that you shouldn't piss off the broker or seller, we are talking about a pleasure activity after all. My conversations with them were very cordial and respectful and I still talk to them, in fact I called the seller a few weeks after the purchase with docking tips and he offered to come and teach me, and he has an open offer to go sailing with me whenever he wants.

Point is, you definitely want to have a fair assessment of the boat's price before placing an offer but if you think it's 30% lower than what the seller is asking don't be afraid to offer 30% lower, there is no reason to give away free money.

Btw, I paid 23% lower than the asking price.

Cheers.

I don't disagree. If it ain't worth it, help the seller out with a substantiated but respectful offer. If there's a broker, s/he'll help you out too. But my take on the OPs question was 30% is a starting point no matter what.

I admit, when I walked on my Willard 36 almost 23 years ago, I said to my wife "well, this boat is sold. We just have to figure out how much it will cost us." I can honestly tell you I do not remember the listing price, I don't remember what I paid for it. I know I got a decent credit for below waterline blisters, and I remember the names of the sellers (great couple), but the price and whether I got a good deal? No idea. I know I got a boat I love to this day at a fair price. As a matter of fact, I'm buying her all over again with an ongoing refit in Mexico. Should be good for another 23 years or more.

My point is, if it's a good boat and it tugs at your heart strings then buy it. It's really good negotiating advice to not get emotionally attached. But I wouldn't buy a boat that didn't stir my emotions, not at a 50% discount. Let's face it, price of a boat has little bearing on the cost to own it.

[mvweebles]

Originally Posted by pjbori

Thanks for the replies. The boat is through a private seller and it's a boat that I've been able to find very little info about - there's only one other one for sale currently in Spain, for double the price, but also in a much better condition. So kind of difficult to figure out what it's worth...

Maybe ask what their price rationale is? If it's a euro boat (220vac or something), its a bit of an orphan in the US. But you will definitely get a lot further by being kind, complimentary, and respectful. "It's a really great boat, I just don't know how to value it. I hope I never need to sell her, but if I do, I need to understand how to do so in a reasonable amount of time." You get the drill.

BTW - the valuation number on a survey is meaningless as an appraisal number for open market sale.

[robert sailor]

You've had some very good advise here but it's pretty hard to negotiate a fair price if your due diligence doesn't net you a comparable. If there are so few of these boats built it usually means deeper price discounts but I'd sure spend some time trying to find comparable. If you can you've put yourself in a position of pricing knowledge and you can make a fair offer and support your offer. As others have said nothing is ever gained with bad feelings over a sale, no matter the price. You want to walk away knowing you paid a reasonable ball park price and the seller should feel he received a fair offer. Either way, good luck on your purchase.

[chrisr]

i agree...go low, but it's not worth alienating the seller

long time ago we were selling a race boat...buyer screwed us to rock bottom price , which i eventually agreed subject AS-IS no further discussion.

boat then slipped for inspection and buyer claimed sail drive was worn (what the #@%^ did he expect for a 10yr old S/D ? it was in 10 yr old condition...no better / no worse) and needed $2000 service. demanded $2000 reduction in price...i was willing to walk away but broker covered half and persuaded me to cover the rest

but bottom line...the buyer then got nothing from me...none of the boat history, performance data, polars, spare gear in the garage, advice...nothing

of course depends on the boat, but in this case it cost the buyer a lot more than he gained.

cheers,

[passage_paul]

I have seen many folks suggest offering 50% less than asking as a starting point..

soldboatprice.com
tracks initial asking prices vs. actual sold prices. The vast majority sold for around the 30% less than asking amount. A few of them for 50% less than asking.

Value is such a subjective thing and is never indicative of actual costs. A pair of nike shoes made for 5 bux being sold for 200 is NOT a fair deal to me.. but clearly there are folks who pay.. so they target those low iq consumers.

When I am ready to put in an offer.. I for sure will be taking into account how long the boat has been sitting rotting away or slowly bleeding the owner with moorage fees. Buyers are looking for a desperate seller.... Sellers are looking for a desperate buyer...

It is like a pawn shop... your tv may have cost 1000.$... but I will give you 100. Will you accept?..How badly do you need the 100 bux?

Desire vs lack of desire is how the entire economy is based..nothing is ever fair trade. Why do you think all wealthy companies outsource to poor countries.

Start low.. if they don't want that price work your way up. You will be much more upset if you buy something only to find out later you got suckered. If they are insulted and refuse to counter then move on....they can sit around and wait for a different buyer, continuing to pay moorage while their boat slowly rots away.. but never ever seem over eager.. ever.. no matter how many boxes it ticks off.... play it cool man play it cool.

MOST people over estimate things they own.. tangible and intangible.. thats probably the biggest problem in society.. how many asshats do you know that think they are the smartest..or their degree is the best.. or they are the best lover... or they are the bestest most educated sailor on Cruiserforums?.... I have been in more than one home or car where the owner was adamant that it is the best...one mans garbage is another mans??

[passage_paul]

Originally Posted by navdi

I just saw mvweebles' post and want to respond to it -

I agree that you shouldn't piss off the broker or seller, we are talking about a pleasure activity after all. My conversations with them were very cordial and respectful and I still talk to them, in fact I called the seller a few weeks after the purchase with docking tips and he offered to come and teach me, and he has an open offer to go sailing with me whenever he wants.

Point is, you definitely want to have a fair assessment of the boat's price before placing an offer but if you think it's 30% lower than what the seller is asking don't be afraid to offer 30% lower, there is no reason to give away free money.

Btw, I paid 23% lower than the asking price.

Cheers.

A pleasure activity perhaps in your case.. but more and more people are setting course for a permanent lifestyle...
While I understand that cruiserforums has a very diverse member base...that "diversity" also is the source of many contentious remarks. I enjoy the little bit of time I have spent here.. met some nice folks..but I definitely am in the market for a forum that caters more specifically towards the fulltimer.. and not weekenders and springbreakers.. completely different mindset and reasoning behind the "advice" that is offered.

[tomfl]

One thing to consider is what I call opportunity cost. By this I mean you can spend weeks, months, or even years searching, bargaining, inspecting, and finally buying a boat; or you can put your cash on the barrel head and be cruising tomorrow.

How important is it to you to get out on the water as opposed to spending time kicking tires?

[Cheechako]

It's always different. Often you just get worn down and can't find the perfect boat. Or you find one that pulls your heart strings but you know it's trouble! DO NOT try to make silk purse out of a sow's ear!

But it also depends on how it's priced to start with and if you are starting to understand the market.

I may start out at 30-40% less, give reasons, make your case!
The response will tell you a lot.
-You offer $20k, they come back $19.5 k you know it's not moving much.
-You offer $20k, they come back 15K you have something going...