If you are serious about the successful sale of your yacht, you must seriously consider a central agent. However, you MUST also carefully qualify and choose the right team and broker.
There are 3 types of relationships between parties in a brokerage transaction:
Seller’s Agent: a broker who represents the seller
Buyer’s Agent: a broker who represents the buyer
Dual Agency: a broker who represents both the seller and buyer
Now, when you decide to sell your yacht, your broker becomes your “Seller Agent” working on your behalf and looking out for your best interests. Their responsibilities are to market your yacht, evaluate and negotiate offers from buyers, and guide you through the entire transaction to ensure a successful closing. If called to act as a Dual Agent, they will have to respect the interest of both buyers and sellers by coordinating a mutually acceptable transaction.
How to Choose the Right Central Agent
Choosing the right Central Agent is the most important decision you will make during the yacht selling process. Here are 4 recommendations that will help you choose the right central agency.
Recommendation #1: Look For an Agent Who Views You as a Client — Not a Customer
Be sure that your broker establishes a client relationship with you — not a customer relationship. If you look up these words in the dictionary, a customer is defined as someone who buys a commodity or a service, whereas a client is defined as someone who's under the care and protection of another. Your broker or yacht consultant should not treat you as a customer, but as a client and act as your advocate and fiduciary.
Recommendation #2: Agree to a Short Term Contract Based on Results
Do not lock yourself into a 6-month or 1-year exclusive agreement without any guarantee of effort and results. Initially, you could agree to a 30 to 90 day contract of exclusivity, which could be extended to 6-months / 1-year based on predetermined conditions. These conditions may be based on specific outcomes and deliverables which must be achieved by the broker team. For instance, they may include proof of having created a full marketing package and a certain number of leads that they should bring. Such a package may include aerial (drone) videos, a virtual tour, walk-through video, photography, a mini-website, etc.
Recommendation #3: Do Not Negotiate The Standard Commission
While 10% is the typical industry standard, you may be inclined to negotiate a lower commission. However, there is a danger in doing so. Do you know the first question most brokers ask when they inquire about a listing? “How much is the commission?” If you tell them it’s anything less than the standard, they won’t be as interested or compelled to sell your yacht.
Here’s why: a 7% commission (3% saving on your end) would represent a 30% drop in commission for a broker and their team. This will negatively impact the promotion of your yacht as it won’t be worth marketing — compared to other yachts offering standard commissions. Your listing will take a lower priority. This also means fewer sales professionals will be compelled to market your yacht, and fewer consultants or brokers will work on your behalf, and less likely you are to sell your yacht.
Having said that, there’ll always be agents hungry enough to do it for a small payday and work on a lower or significantly lower commissions. However, be cautious of hungry brokers — as they might not have the experience, budget or network to market your vessel properly.
Recommendation #4: Effort Determines Success
Beware of Central Agents who’ll place your yacht on multiple listing sites and then wait. They will wait for other brokers to do the hard work, and for other brokers to bring in the potential clients. We have seen some brokers specialized in “getting listings” and then wait for a miraculous buyer to show up, or for another broker in their firm to sell their yachts.
The goal of the right central agency is to sell the yacht, not just to list it.
At the end of the day you’re looking for a central agent who can sell your yacht. Be sure to ask the central agencies what plan and system they have in place and intend on using to sell your yacht. Then be sure to compare their method with the method of others.
To help you make such a comparison you need to understand some major principles of the yacht selling process.