What sets the best Buyer's Reps apart from the rest?
The market is tight, probably tighter than it has ever been. With companies like ours making direct contact with aircraft owners to purchase their airplanes, the number of listings available to brokers has dwindled. So where does that leave them?
The best Buyer’s Reps think like BUYERS.
The market is tight, probably tighter than it’s ever been. With companies like ours making direct contact with owners to purchase their aircraft, the number of listings available to brokers has dwindled. This has forced many brokers to pursue buyer representation. There’s nothing at all wrong with that. In fact, our industry needs more representation for buyers, but we need brokers who are willing to switch sides and become Buyer’s Reps: professionals who will dedicate themselves to representing buyers. We need brokers who think like BUYERS!
In this crazy, chaotic market, it takes a lot of restraint to tell a client to wait, especially if you’re paid when an aircraft closes. The typical broker thinks like a seller—they want to sell and close the aircraft so they can get paid. As a firm that represents buyers by profession, we can’t afford to think that way. We must put our client’s interests above all else. We aren’t selling aircraft. We’re buying them.
Buyer’s Reps have to make the mental jump from selling aircraft, where the focus is on closing a deal, to buying aircraft, where you have to make sure everything is right, including the price. An acquisition is a long, tedious process when done properly. Unfortunately, the folks who are accustomed to selling airplanes typically struggle with the process and tend to take shortcuts.
If you’re a buyer considering who to hire to represent you, here are a few things to keep in mind.
No one works for free – If you’re interviewing buyer’s reps, expect to pay a retainer. A reputable buyer’s agent will typically charge a retainer because they know how much work has to be done up front. If they aren’t getting paid for their work, you should consider how much work they’re willing to do.
Commitments work both ways – Whether it’s a retainer or a written agreement, the client should be as committed to the agent as the agent is to the client. Beware of situations where a broker doesn’t require an exclusive agreement. If they’re not working exclusively for you, does that mean they can pursue another buyer for the same type of aircraft you hired them to find?
Who’s working? – Before hiring anyone to acquire an aircraft for you, you need to ask this important question: who will be working on this project? In today’s market, you can’t rely on Controller as your source of available aircraft. If that’s your broker’s plan, I can almost guarantee you that you’ll overpay for whatever you buy.
Off-Market Opportunities – How does your rep plan to find off-market aircraft for you? As Buyer’s Reps, finding off-market aircraft is at the heart of everything we do. If all we do is show our clients aircraft that appear in public view on Controller, they really don’t need us!
If you’re reading this because you’ve decided to hire someone to represent you in your next aircraft purchase, you’ve made a good decision. It’s just as important to carefully choose who will represent you. I’m biased towards buyer’s reps who don’t represent sellers. It eliminates an obvious conflict and resolves the buyer vs. seller mentality issue. Unfortunately, there are not a lot of buyers-only agents out there. If you do decide to hire a broker to represent you, asking good questions about their experience, process, and team can help you determine who is the best fit.
Always remember that no one works for free. If a broker claims to be working for a reduced fee, no fee at all, or a fee paid by the seller, then they don’t work for you. There is no standard fee in the industry, but if you consider the work that goes into an acquisition and the value in an exclusive shot at off-market aircraft, you should have some idea of what fee would be reasonable.
You’ll find that the fees charged by reputable acquisition firms are similar, and all will require a retainer. If you see any deviation from what they quote you, you should definitely ask more questions.
The first question to ask yourself is, “Does this rep think like a buyer?“
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