A broker's rant (yes we're allowed)

Don't do this to your broker. Broker's pay their bills, buy food, put their kids through college, buy their own health insurance etc. when they participate in a sale. The rest of the time every single thing they do or spend is uncompensated. Brokers pay to advertise your boat. Brokers pay for access to information ie: Yachtworld. Good brokers drive tens of thousands of miles a year showing boats. Good brokers answer phone calls late into the night and exchange emails at all hours.

I just, as sometimes happens in this business, learned that a client of mine that I have been exchanging emails (104) and phone calls with for two and half years up and bought a brokerage boat without ever saying a thing to me. One of the many disappointments are when you are working with a client and educating them about the boats etc that they then take those dozens or more hours of work and use that knowledge to make a better informed decision without ever seeing that you are compensated. The well found decision then results in the listing broker receiving the commission for the work done by the buyer's broker. The typical response to this type of brutal gut punch is "sorry I didn't realize".

Sorry to hear that, Mark. It has to hurt. And yes, you're allowed.

Mark: That really sucks! What, the guy never heard of a co-brokering agreement?

It really sucks and is very inconsiderate, but it also sounds like you never made it clear to your client what the "deal" was.

Mark, it's unfortunate, but the mistake was yours. Owned a scuba store for 20 years. You don't make squat for teaching scuba classes. The money came from the sale of scuba gear. Learned early that students would buy elsewhere on a whim after I certified them. Realized that it wasn't malicious on there part. We just live in a big impersonal world where no one thinks anything of stopping at Lowes in stead of Home Depot. As a result, I explained to my students on the first night of class that the sale of equipment is what kept the business open and how we greatly appreciate the opportunity to work with them if they should want to buy equipment in the future. This made a big difference. Sure I still lost some sales, but the people who appreciated the time I spent with them almost always would buy whatever they needed from me.

You need to explain to people what you can offer if they are looking at boats listed by another broker. Also good to explain how a commission works on the boats that you broker, and that it is the seller who pays your percentage. Presented propperly, it's not offensive to the customer and helps them understand that you are a small business and this is how you make you get paid.

Sorry you had this bad experience. Hope you can use some of the above to make sure it doesn't happen again.

Ted

I had worked many years in the boat business (engines, slip rental, etc) and finally a broker friend explained to me how the co-brokerage thing worked. Up to that point I had no idea exactly how it worked. It is not obvious to most.

To the OP, there is a good chance your "client" was the same as I, simply ignorant of the workings, and not malicious.

This might be a good place to explain how it works. I suspect ignorance such as mine is not unique.

Mark,
If the cost of "educating" your clients dosn't support your bottom line then what are you doing it for? Just because you're in business dosn't mean your clients should help pay your bills. Someone else FOUND a better boat and that service was paid for. Some of your clients could probably post a rant about how little time you spent on their deal and how much money you made. Everywhere in commission sales most of your time dos'nt make a buck. I think if you considered how much time you spent at your work and how much money you've made you'd be pleased w the numbers .... or you wouldn't be doing what you're doing. And if you're not pleased you should sell TVs, cars or real estate. At least you should evaluate the cost effectiveness of "educating" your clients. Perhaps you should spend more time finding boats so they'll buy from you and support your bottom line ... If that's most productive. Do whatever leads to sales ... of your boats .. or boats you're connected to commission wise.

O C Diver said:

Mark, it's unfortunate, but the mistake was yours. Owned a scuba store for 20 years. You don't make squat for teaching scuba classes. The money came from the sale of scuba gear. Learned early that students would buy elsewhere on a whim after I certified them. Realized that it wasn't malicious on there part. We just live in a big impersonal world where no one thinks anything of stopping at Lowes in stead of Home Depot. As a result, I explained to my students on the first night of class that the sale of equipment is what kept the business open and how we greatly appreciate the opportunity to work with them if they should want to buy equipment in the future. This made a big difference. Sure I still lost some sales, but the people who appreciated the time I spent with them almost always would buy whatever they needed from me.

You need to explain to people what you can offer if they are looking at boats listed by another broker. Also good to explain how a commission works on the boats that you broker, and that it is the seller who pays your percentage. Presented propperly, it's not offensive to the customer and helps them understand that you are a small business and this is how you make you get paid.

Sorry you had this bad experience. Hope you can use some of the above to make sure it doesn't happen again.

Ted

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Thank you but that is always one of the first things I do when acting as a buyer's broker. I make very sure that my clients understand the "business" end of things. My intent in ranting was to educate those who might not have known this.

A year ago we sold a house. The listing broker said that if the buyer was not represented by a broker he would charge us only a 3%, and not a 6% commission. That is how it worked saving both the buyer and seller a great deal of money.

Two years ago when boat shopping we did not have a buyer's broker and in the cases where offers were made the listing broker automatically reduced the asking price by 1/2 the commission -5%- before negotiations started.

In your case Mark, maybe it was nothing more than simple economics. I assume you did not have a formal agreement with the buyer?

I spent some time with a broker I liked. He showed me many boats and I ended up buying from someone else because I found a boat on my own. In fact, I did not like the broker "attached" to the boat I bought - no rapport at all.

I did not know I could use the original broker. Just didn't know it worked that way and I felt pretty stupid when I was told. My poor broker only got an apology and a bottle of wine for his efforts.

Your efforts to explain how it works to us who are focused on the boat and not the process will help do away with ignorance and misconceptions and hopefully make this industry better.

Daddyo said:

Thank you but that is always one of the first things I do when acting as a buyer's broker. I make very sure that my clients understand the "business" end of things. My intent in ranting was to educate those who might not have known this.

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Opps, sorry. The buyer now more resembles the ass at the restaurant who doesn't tip his waiter because the waiter's livelihood isn't his concern.

Ted

Yep I agree it could be all a misunderstanding that a broker can be used even outside what he/she have been pushing. Mark, do you ask your clients if they have been using a broker somewhere else before you start the path to a potential sale? Sometimes that standard can save many of a disappointment. I agree the focus is on the boat of choice and not the business of the sale. Sorry too Mark that you were disappointed with all the effort you put in. I had an Electrical business and wouldn't do work in another county unless I knew my client didn't have a quote from one of the contractors in that area. Actually I did background checks to make sure. I just had enough work in my own area and fighting off the competition was done by better customer care.

OK. So I'm the ass it would appear.

Mark and I did talk on the phone a few times and we did exchange many emails quite awhile back. I did go look at a boat he had listed in MD and didn't like it, like maybe a year ago? Really didn't hear from him much after that and I figured that was that. We did talk about him being a buyers broker, but we never had any formal, written agreement, and I don't remember him EVER sending me any boats, but I could be misremembering.

Since then I've looked at quite a few boats (and posted them up here) and did not use any buyers brokers on any of them or talk to Mark, and never heard from him. I really didn't think we had any agreement.

I'm a little surprised he is going off on me now, but I do (and did) apologize because now I feel like I've f$&ked it up somehow, so I understand his frustration.

I'm in sales so do get it, but I don't tend to whine when **** doesn't go my way.

Don't want to start a pissing match, but wanted to respond.

Ya not a good place carry out an exchange on a misunderstanding although we get the point and I am sure both of you learnt a good lesson. Three sides to every story. The point is sometimes we forget how what we do may affect others in the process, contractually or not. Feelings go deep when hurt happens.

My 2cents

Mark,

It was obvious to me that you were only trying to educate some people here on TF that weren't familiar with how the system works and not looking for advice on how to be a better broker. I know how the commission system works and I've been in your situation before so I sympathize with you.

For me, it's quite alright that you ranted about this.

For others on here, apparently it isn't. It seems that they think you're a rookie, or not very good at what you do, and instead want to point out where you went wrong and tell you how you can be a better broker.

Someone always know better, or, knows more, even if they're not in the business. Unfortunately, this is typical of many TF'ers.

By the way, I'm not necessarily talking about the posters on this thread only, but alot of TF'ers in general.

This is not a sympathetic, nor a very nice place much of the time. But, maybe it's not supposed to be and I'm just naive.

I have found out the hard way that although there are many stupid people out there, they're are even more that plead ignorance when convenient.

Nsail said:

This is not a nice place much of the time. But, maybe it's not supposed to be and I'm just naive.

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It's the nature of forums. I think TF is a little better than most but much has to change or else it's going to die. As proof to that, I offer this question: how many women participate here? 2%? If that? Women won't put up with much of the crap that goes on here. It can't continue over the long term unless and until women are a part of the conversation (remember that quote!).

To the subject...

I think the OP has a right to rant. I think his perspective is enlightening. And as someone who's owed businesses for his entire career, I sympathize with the idea that he spent a lot of time educating his customer and nothing came of it.

I also think it's nice that some others here have shown sympathy. And I sort of feel bad for his time loss but my feelings end there. I'm sorry but it's the way business happens. If the broker was going to act as a buyers broker, there should have been a contract. That wasn't done here.

If the client isn't willing to sign a buyers broker contract, then the broker earns income by finding a boat for the client to purchase. If he doesn't do that, someone else will. And then that person deserves the commission. The question is, why didn't the broker find the boat that was finally purchased? And I totally understand that YachtWorld throws a curve into all of these traditional ways of exchanging information. Trust me, I totally get that - that type of thing is all I've done for the last 3 decades. But come on. Welcome to 2005 with YachtWorld replacing brokers for finding boats.

All of that said, the really nasty thing here is the subtext of what this thread is really about. It seems that the broker knew the client was a contributor here. It's kind of obvious that this whole thread was an attempt to create a sideways slap in the face to the client.

And that just sucks.

I challenge every reader of this thread to show it to your wife and ask her what she thinks about it.

cardude01 said:

OK. So I'm the ass it would appear.

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Bahahahaha.
This is why I love the internet. I'm in construction and I wouldn't be caught dead in a construction forum. I hope this thread is not about you but if it is I wouldn't worry about it. Mark, I have loved your post in the past but if this post was just to single out a fellow TF'er I hate to hear it.

Pills, gentlemen, take some.

I don't think Mark meant to call out anyone anymore than Cardude meant to be someone to call out. It might be a case of one or both being unconscious of the other's intention (or investment for that matter), but sh-t happens. Mark's post has me thinking about whether I covered all the brokers that I may have milked for info. I'd also send Cardude a bill for info, but the truth is that I've learned as much from him as he has from me. Chill---

This broker say's:

Yeah, the Internet is a sword that cuts in both directions. On one hand it makes it easier for buyers and sellers world wide to quickly find you, and on the other hand it makes it easier for buyers to quickly find other sellers, brokers, and boats.


To my fellow Broker I suggest that the best you can do is thank people politely for their time, wish them the best of luck, and to remember you when they wake up in the future. It's like fishing- you don't expect to catch every fish, or it would be called catching. I've been doing this for 40 years now, and if I had a nickel for EVERY one of these buyers who made mistakes, calling me up years later saying "you were right, I should had listened"- I would have several dollars by now- but THE next time they do listen to you after you help them liquidate their mistakes - they then allow you to find them the right boat for them (which might be NOT what they thought they wanted)- then you get repeat business, along with great referrals. And sometimes people are just scum bags. I've had them stay the night in my house, pet my kid, look me in the eyes, and say they're buying a boat from me, and then go right around my back and buy it from another to save a dollar- It happens. Karma has a way of catching them. No problem. What goes around-comes around. A honest person can't be conned, only a greedy person-ask the gypsies across the canal in their mega mansion. They depend on that fact to play their games, but even they get caught in a "great deal".



Just feel solace, and sleep well tonight that YOU didn't sell that buyer whatever he ended up buying, it was his choice, so he can't blame you when he discovers he should had listened. When I sell a boat- I'm thinking WAY past the buyer, I'm thinking "how easy will it be to resale this boat for this guy in 3 years, and then to the next guy after that, and the next guy after that?" If the answer is: "I don't think I can"- I'll recommend the buyer go buy whatever delusion he's chasing from some Brokerage with a fictitious name that won't be around next year to complain to, and even if you sue them- you won't know who the real owner is anyway, and he'll just keep reopening brokerages under other fictitious names and move state to state.. (speaking of Symbol Yachts).
Cheer up, and MOVE up. Just remember buyers wanting fast boats BUY fast, and those wanting slow boats buy slow. You've seen what happened to the sailboat market haven't you? You see what's happening on the fast boat market right now? What I like about the Internet is now I rarely have to drive a buyer anywhere, most mine buy sight unseen relying on just ALL my large photos and specs, I have posted on the Internet, along with references from others who've bought this way from me. THAT I like about the Internet. Back when I was single-you couldn't beat Match.com for quick companionship..like pretty rich doctors, lawyers, and rich divorcees would just come over to your house- right quick. Internet is good for speed.
And this wasn't a rant..this was love.

I think the buyer in Marks story hurt himself as well as Mark. I know if I had established a relationship with a broker and then found a boat on my own, I would have called my broker to help me with the purchase.

I've had a lot of real estate dealings recently. If I see a property I'm interested in, I never call the name on the sign. I call a broker I know and trust and ask him to find out about the property. That way he gets a piece of the commission and I get good advise. Usually it's "Are you insane? Don't buy that!" He doesn't make a lot of sales with that advise but it's why I call him every time.

Daddyo said:

My intent in ranting was to educate those who might not have known this.

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Please guys, I don't ever do anything backhandedly. I stated my intentions in both my original post and above in my second. Where else could I post this as this is the only place I post? I never called anybody out and would never reveal a client no matter what. I'm very sorry that someone chose to reveal themselves that was never, never, never my wish. I will not discuss the specifics of this deal now that anonymity has been lifted. I think the majority of the time these things happen it is out of ignorance and not ill intent. I wanted people to understand the job that some brokers do and stick my neck out in attempting to foster greater understanding so if a client in any walk of life chooses this path that they do so knowingly. I would never contractually bind a client to use my services. They are always free to do as they choose, I think it's important that we know the results of our actions as the outcome can often be unintended. I told this client they are always welcome to call on me if they need anything and that I truly hope the sale works out. That's the way I do things.

"ONLY Brokers in Florida and California are licensed."

Just so people know Virginia requires a license and bond and MD requires pretty extensive licensing by the brokerage.

HopCar,
On a side note I finally just realized your ride. Donnie builds one hell of a boat doesn't he?! I hope to have announcement soon regarding those guys.

Daddyo said:

"ONLY Brokers in Florida and California are licensed."

Just so people know Virginia requires a license and bond and MD requires pretty extensive licensing by the brokerage.

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I didn't know that. Live and learn-I stand corrected. Thank you. There's a Yacht and Ship Division in the State government in Virginia that can pull licenses and chain doors shut, and seize bonds upon a formal complaint? I didn't know that..but regardless I'd already deleted this when I edited my post.
Of course having a license certainly hasn't stopped a good amount of thieves in Florida OR California by any means, and many were under fictitious Brokerage names anyway, so the public might not know the actual name of the thieves, and some of them just moved to other states. Although I can't think of any that actually had their brokerages names the same as their own, daddies, and kids. Sometimes I wish I had gone with a fictitious name so I could sell popular boats that I don't wish to have associated with my name. Certainly would make more money if I sold boats with latent defects-that's for sure. Can't though- ghosts would get me!
Some of the most honorable Brokers I know reside in States that don't require any.

Well, hopefully it'll all even out in the end. Sure, you lost that sale after a significant investment of time and effort, but next time somebody will appear on your doorstep and jump into a sale after some other broker invested lots of time. All evens out in the end - or at least it should.

I have a broker with Pop yachts who has been browsing boats for me for two years. I only mention that brokerage specifically because that one is a highly automated, online brokerage, kind of unusual that way. He can track which of their listings I look at most, and he's got the capability to shoot me automated emails to flag boats that track with my search history. He also sends me personal emails too. I like the guy, even with a highly automated sales tracking system he's spent a lot of time on me. I would love to buy a boat from him eventually, but so far haven't found THE ONE. Maybe it will be his listing eventually. Maybe not. But I expect it will all even out in the end.

(I asked him once if he acts as a buyer's broker, but he never answered the question. Could be that that brokerage is exclusively online with their own listings, I don't know.)

I would be careful with them is my two cents. Odd your guy wouldn't answer that question? I have had clients mention long after the fact that they were working with brokers. I have always protected the other broker once I learn of their existence no matter how involved or not.

Let's keep one thing in mind. Mark did not disclose or point to the client or non-client, as it turned out, in name or any way I could discern.

As to what happened, none of us know the specifics nor are they really important to this discussion.

The fact is that there are good brokers and bad brokers. The relationship between broker and client is very important as is good communication. Frankly, the best way I know to insure that communication is something in writing. Doesn't have to be a contract since that would be contrary to the industry norm in buyer's situations. But if I was a broker, I'd hand a brief document of some sort outlining what I would do for the buyer and then what I asked (note the soft word "asked") of them in return.

A fact of life for brokers or persons in sales of any form is that most "customers" never actually convert to purchases. You spend money on every potential customer or client, but you only get payback on a few. Hopefully enough to justify what you spend.

Now, as to buyers, if you don't feel the broker is doing what you need, do go to another. But please do it for service. Doing it to try to cut the commission might save you money, at least might appear to, but is that really fair? Each year many of the good, responsive, knowledgeable brokers tend to retire or otherwise move on. They're at best replaced by less experienced. But often they're replaced by huge brokerages just bringing another disposable (I don't consider anyone disposable but sometimes they treat them as they are) young eager person on board.

Bad brokers can be a waste of time and money. But good brokers can pay for themselves many many times over. Most used boats in the trawler range are sold through brokers. A good broker can work you through things and help you avoid mistakes. A bad broker can encourage you into mistakes. But do recognize for it to work, you need to do your part as well. Stay in touch. Make it clear what you expect from them.

On the other hand, part of being a broker is qualifying the client and deciding what time and energy to spend. If you believe it's a good investment of your time, you stay active and on top of the situation. If you don't stay in touch and actively working for them, then don't be disappointed when they sell or buy without you.

Ultimately brokerage is a service business and I do believe ultimately good service will be rewarded. However, the growth of some of the mass merchants in retail make you wonder sometimes. Still, I'm committed to service and found in our little area of the retail world it seems to be paying. So to the broker, provide service and value not just worth your fee in your mind, but that the client will perceive worth the fee. And to the potential client, lay out your expectations clearly, if they aren't met discuss, and if that doesn't work, move to another.

When it becomes a matter of just dollars and cents then both the broker and the client will end up losing. When it's all geared toward service, then both will win.

O C Diver said:

You need to explain to people what you can offer if they are looking at boats listed by another broker. Also good to explain how a commission works on the boats that you broker, and that it is the seller who pays your percentage. Presented propperly, it's not offensive to the customer and helps them understand that you are a small business and this is how you make you get paid.

Click to expand...

Daddyo said:

Thank you but that is always one of the first things I do when acting as a buyer's broker. I make very sure that my clients understand the "business" end of things. My intent in ranting was to educate those who might not have known this.

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Well ... call me ignorant ... but how the buyer broker thing works. I never used one ... I always dealt with boat seller's broker myself.

What constitutes or commences the buyer and broker business relation. I can sense it's not a black and white thing, and somehow different than in real estate.

This might be an opportunity to educate the ignorant ...