Brokerage rates

[jimmy_the_builder]

What sort of brokerage rates are people paying? I've just had a broker in the south of France quote me 10%+vat, which seems a bit strong to me; I suppose I was expecting perhaps 5-6%+vat. Interested to know what others are paying, especially Med brokers.

 

[kashurst]

that seems an awful lot for doing sod all, down in Spain 6 - 8% + vat. However broker in my marina (Navicularia) sold my last boat for 4%+vat.

 

[Whitelighter]

Seems expensive. I’ve heard 8% before but it’s ofteb negotiates me down.

I guess it depends what the broker is going to do for you

 

[BartW]

In Italy general rule is 5% by the seller + 5% by the buyer
but in Italy everything is negociable.

 

[MapisM]

Correct.
Weird as it might sound to most folks here, in IT the broker commission is split between buyer and seller.
And yes, some discount is often negotiated in the process - typically somewhere between 3 and 4% each side, I would say.

All that aside, spill the beans, JTB: what is there round the corner?

 

[Nigelpickin]

What sort of brokerage rates are people paying? I've just had a broker in the south of France quote me 10%+vat, which seems a bit strong to me; I suppose I was expecting perhaps 5-6%+vat. Interested to know what others are paying, especially Med brokers.

Forget the brokerage fees and ship it to the states.

Boat.co.uk or Ancasta will do far better than that won’t they? I think we paid Ancasta 5 or 6 percent (plus VAT) for Breaking Bad - boat went quickly with no problems - good, qualified clients.

 

[Pinnacle]

In my experience, initially quoted rates are always negotiable. The most I have paid is 5% +VAT.

 

[volvopaul]

The med has always carried a 10% levy .
TBH Jimmy I bet your boat would sell very quickly on a site like Boats and Outboards , Apollo Duck etc or even eBay , unless of course you don’t want the hassle .

 

[vas]

All that aside, spill the beans, JTB: what is there round the corner?

+1

don't care/don't know the brokerage rates, but I'd be interested to know what's coming and if it's going back to the UK for "treatment" which gave us a couple of excellent threads back then

V.

 

[Seastoke]

Rumour in Wales is he is having ,JFM,s Princess

 

[MapisM]

JFM,s Princess

Now, that's a Freudian slip, if I've ever seen one!

 

[mcanderson]

Jimmy, we paid 5% inc VAT using Seaside in Beaulieu. However, I think Bertrand halved his fees as we sold in less than 24 hours of listing. A broker in Beaulieu is probably too far for you.

 

[Eren]

The rate also depends on the price of the boat. For high priced boats, it is possible to get better rates. I sold a boat in Monaco and the best rate I was able to get was 6%. At a sale, usually more than one broker is involved behind the curtain. They share the commission. So, for a quick sale, you should grant them a feasible commission that they can work with secondary brokers. In SoF, all commission is paid by the seller.

 

[DAW]

My experience in SoF is that 10% plus VAT is the starting point for the negotiation. Most brokers I’ve spoken with will fairly quickly move to 7-8% plus VAT provided they don’t have to share the commission. There’s usually an asking price and a target price for the boat and if you make it clear what your lower limit is they’re generally willing to compromise on commission to make a deal happen.

I’ve not seen any of the better brokers drop much below this unless there are special circumstance like back-to-back purchase of a boat they’re marketing (particularly if relatively new) a very quick sale, introduction of the buyer by the seller, heavily discounted price, etc.

I’ve heard good brokers give low commission as a reason why a boat hasn’t sold ... saying no one can be bothered to put in the effort promoting it if they have something else to sell which gives them a higher commission.

 

[Deleted User YDKXO]

I had an unsolicited approach from a broker (Luca Vendite) whilst sitting in the cockpit of my boat last season in Port Vauban who said he was very keen to sell my boat. I wasnt interested but I did ask him what his commission was and he also quoted 10% + VAT which I also thought was ridiculous and I told him so. He said that was normal for SoF. Elsewhere in the Med I've also been quoted 6 or 8% which is more comparable to the UK

FWIW, I would say 2 things generally about brokerage commission rates. First its more important to worry about getting the right broker for your boat then what his commission rate is. There's no point in putting your boat with a broker who quotes a low commission rate if he doesnt sell it or only gets you a low price. Second, commission rates are nearly always negotiable. When it comes down to the final bartering on price a broker will usually agree to cut his commission rate if it helps bridge the gap between buyer and seller. After all 5% of something is worth a lot more to him than 10% of f*** all

 

[jfm]

I’ve only sold 3 on brokerage but always do a number not a rate. Iirc €20k for the first sq58, £30k for second one etc.

I think it focuses mind of broker when they see well presented boat and a meaningful amount of money (to them). I totally don’t buy any argument that they have better incentive to get more money for the boat if they are on a %, because the marginal extra to them of getting another 25k for the boat (or whatever) isn’t meaningful. Their incentive in my mind is to get a sale at a price I’m happy with.

I think this method ends up in a lower % anyway.

In all my cases I consider it money very well spent. I don’t agree that the broker does nothing (at least, in the case of a good broker).

 

[DAW]

+1 for jfm's comments.

For each of the boats I've sold, I first decided on the net amount I would accept for the boat, the amount of commission I thought was reasonable, reversed that into the commission rate I was happy to pay, and then arrived at a target selling price. In each case, the commission has been about £30K, represented 7-8% and with a sensible target price, the boats all sold quickly.

Don't forget a broker working with an organisation like Princess, Sunseeker, etc. will lose a big slice of the commission to their employer who has significant overheads to cover (someone has to pay for the nice offices, company cars and all that marketing at boat shows, events, etc.).

Nobody ever thinks their baby is ugly and its the same with boats. Its the brokers job to bring together a seller who doesn't see anything wrong with his boat and a buyer who has a long list of issues he wants fixed at the seller's cost. In my view, its also the broker's job to coordinate the condition survey and sea trial, arrange for issues to be fixed after the survey, sort out any problems with the documentation, work with lawyers from both sides on the contract, etc. On a low value or "sold as seen" purchase this may not be a big deal, but on something high value it is. It can be a lot of work and the process can take several months.

Regarding rates prevailing in the SoF and the Med in general, they also reflect the significantly higher cost of living and the fact that 30% of the employment cost gets consumed by the equivalent of employers NIC and pension costs and personal income tax rates are much higher than the UK.

 

[Portofino]

+1 for jfm's comments.

For each of the boats I've sold, I first decided on the net amount I would accept for the boat, the amount of commission I thought was reasonable, reversed that into the commission rate I was happy to pay, and then arrived at a target selling price. In each case, the commission has been about £30K, represented 7-8% and with a sensible target price, the boats all sold quickly.

Don't forget a broker working with an organisation like Princess, Sunseeker, etc. will lose a big slice of the commission to their employer who has significant overheads to cover (someone has to pay for the nice offices, company cars and all that marketing at boat shows, events, etc.).

Nobody ever thinks their baby is ugly and its the same with boats. Its the brokers job to bring together a seller who doesn't see anything wrong with his boat and a buyer who has a long list of issues he wants fixed at the seller's cost. In my view, its also the broker's job to coordinate the condition survey and sea trial, arrange for issues to be fixed after the survey, sort out any problems with the documentation, work with lawyers from both sides on the contract, etc. On a low value or "sold as seen" purchase this may not be a big deal, but on something high value it is. It can be a lot of work and the process can take several months.

Regarding rates prevailing in the SoF and the Med in general, they also reflect the significantly higher cost of living and the fact that 30% of the employment cost gets consumed by the equivalent of employers NIC and pension costs and personal income tax rates are much higher than the UK.

Agree with all of above except the last para , that’s exactly how I did it with a Sunseeker , in-fact the Sunny Broker did that for me .
Added his 8 % + vat to “ my price “ then a bit more for the out of date ER fire extinguisher he picked up compiling the paperwork, another grand for the buyers survey , he said they all want that back , it’s just a game really it’s added on to the sticker price .
It went within 3 weeks .I let the broker take prospectives out for joy rides iirc the 2nd bought it paid his deposit then the first came back so was too late .

Regarding pitching the price it’s basically depends on supply and demand and how quick you want to shift it .
Broker advised me of what they were going for , which was the same number I figured out anyhow .

Re last para I understand it’s nearer 50 % the on social costs employers end adding to a salary to hire a person legally .
That’s mostly why there’s a lot of one man bands btw .

 

[Deleted User YDKXO]

I’ve only sold 3 on brokerage but always do a number not a rate. Iirc €20k for the first sq58, £30k for second one etc.

Mmm, I agree that a % commission provides only a small incentive to maximise the selling price but a fixed commission provides no incentive at all for the broker to do that, in fact quite the opposite as the incentive is to get a sale at any price. Also a fixed commission puts a cast iron figure in the broker's head (which he's already pre-spent on a new car) and he will be less willing to compromise on that commission to facilitate a sale

I do agree though and as I said before, it is far more important to worry about getting the right broker for the boat who is most likely first to sell the boat and second to achieve a fair price then it is to worry about % commission

 

[MapisM]

it is far more important to worry about getting the right broker for the boat

Spot on. Worrying about the commission is akin to missing the forest for the trees.
I'd dare suggesting that the final commission negotiation could be postponed to whenever there will be a genuine interest (i.e., not necessarily a binding offer) to be evaluated.