From COVID "Order-Taker" to Post COVID Professional Yacht Broker
By: Ryan White, CPYB, IYBA, YBAA Board Member
During the chaos of COVID, we as Yacht Brokers were becoming more of order takers than anything else, it seemed. And although we enjoyed the times when we were selling everything we could get our hands on, for record breaking prices month over month and year over year, at some point it had to slow down and get back to normalcy. I feel like that trend is happening in all aspects of our jobs, from new boats being in stock, to sell prices leveling out and in some cases falling, as well as more boats coming to market over the recent months. With these trends continuing and the current market environment changing, I feel it is as important as ever for us to present our clients with the right information whether buying or selling, to ensure our client’s best interests are attended to in an appropriate manner for success.
When a client is considering selling their boat, it’s important to analyze the market as well as set the right expectations for success in the changing market dynamics. The boat needs to get sold in a timely manner as well as for the highest price or return possible. Time equates to money when we consider the carrying costs for the boats we sell, as well as risks of ownership. So, pricing a boat correctly, presenting it well with the most information you can provide, and working with every lead or call you get on that boat is vital. The climate today is highly competitive, market wise. This means that you need to push your inventory to your peers & fellow brokers, look for cooperative support from every source, and be certain you are engaging with everyone possible to generate as much interest and visibility with your listings. This is much different than what my experiences have been in recent years, when we’re able to sell our products with minimal effort. Even the most basic of listings, just by having the boat online with minimal information & details. This is where we were becoming more order-takers than Yacht Brokers. We had to dig deep to find advantages to get our boats sold over other competitive listings. For that matter, we almost knew that regardless of whether ours was the next one to sell, it would most likely be one of the ones to sell, as they all sold in record time. Heck, we were often in situations with multiple offers, and even offers over “Ask Price” on many products due to the limited inventory available. Looking ahead, we are going to need to be more proactive in how we approach the market with our listings, as well as setting reasonable and attainable expectations for our clients looking to sell their boats.
When it comes to our clients looking to buy a boat, I strongly feel that setting the right expectations is vital. Success for your clients in getting them the right boat for the right price. When we consider the trends of interest rates rising, more readily available new boat inventory, dealers & manufacturers offering larger discounts, and more used inventory, it’s changing the way we approach the market with our clients’ interests. There is also no “standard”, and it must be approached differently depending on the boat you are looking to find, which means as a Yacht broker we must be educated or in tune to the specifics related to the boats our clients are in search of. For example, some of our clients can expect to get better deals and be in a more competitive buying position, giving them the ability to negotiate strongly. While in several segments of the marketplace, it remains hard to find certain brands, models, and types of boats, where prices are still strong, availability still low versus the amount of qualified buyers, and a lot of cash buyers looking to find their next boat. So again, it is more important than ever when working with a client to buy a specific boat, that you know where your clients’ interests lie, and the specifics of the market segment they are shopping in, so you can successfully assist them in finding the right fit. And this means in the right boat, the right price point, as well as the right exit plan when the time comes to sell it. When we consider the “exit plan” strategy, I feel like this is often times a much overlooked piece of the process, and I always do this with my clients, regardless of what their plans are. As we know, all too often, plans change for numerous reasons, and not always foreseen. So I believe it is very important to approach this with your clients in a 1/3/5 year projection, considering what the future market will look like in those periods, but also surrounding what needs and maintenance the boat will need over those periods, as well as what those costs will look like. This will allow you to make sure that at any given time, your client can move out of the boat for any reason, within the planned options, and not get stuck or surprised with unexpected losses or hurdles.
As we move forward with the navigation of the changing landscapes of the boat and yacht markets, we should analyze our approaches with our clients, and be sure we are doing everything we can to do the best job for our clients possible. We are a small niche industry comparatively speaking, rely almost solely on our clients discretionary income, and we have to work hard to earn & maintain these relationships. So give these things some thought, and make some changes in how you approach your job, as well as your client’s goals, to become a better Yacht Broker. Working hard on the things above, doing what is right for the clients always, and keeping their best interests at the forefront of everything you do will help you achieve the ultimate goals which are repeat business and client referrals which are the best reward for a job well done!
Ryan White, CPYB, IYBA
YBAA Board Member