A yacht brokerage company, like any sales organisation, needs to have a leader in order to perform at its best. It takes charisma, significant sales experience as well as ability to coach and motivate sales people in good times as well as in moments when sales are low. The way that the company is managed will have a substantial influence on the performance of its sales professionals. So what does it take to manage a yacht brokerage company successfully? Here, industry veteran Hein Velema gives us his insights into the management of yacht brokers.
Traditionally, yacht brokerage companies are founded and managed by yacht brokers. The managing brokers of successful companies are often charismatic and inspiring salesmen, and manage by example. When a brokerage company matures, the moment will come when the founder steps back and sells his company. The new shareholders often have little experience with yacht brokerage and wonder how to manage a group of brokers who at first sight look like unguided missiles. Managers who are new to superyacht sales are often surprised about the lack of structure and the first thing they want to do is to create order. The way brokers are managed will have a great impact on the results of the company, and the manager can make or break the success of the salespeople.
Understanding the broker
Even the most successful yacht brokers will close only a few sales per year. Brokers have to accept failure after failure without losing their self-confidence and motivation. Salespeople need constant confirmation from their managers to boost motivation and self-confidence. A manager needs to have a deep understanding and respect for the struggle brokers go through when they don't sell a yacht for a while.
One of the biggest mistakes a manager can make, is to look down on salesmen because "they only think about money". Managers can be frustrated because successful brokers earn more money than they do. This attitude will be undoubtedly felt by salesperson and destroy his confidence in the management. A manager who doesn't appreciate salespeople will have difficulty attracting new experienced brokers and will finally see good brokers leave the company.
While looking for new market opportunities, brokers need to be open minded and creative. Also when deals seem to go wrong, they need to stay inventive to find solutions to make both buyer and seller committed to finalise the deal. Managers play an important role to create an environment where thinking out of the box is stimulated and certainly not being suppressed.
This model helps to select, train and evaluate managers responsible for a yacht brokerage business, putting the yacht broker in the central position as the most important asset of the brokerage company. The question is, what can the manager add to the brokers so they will be more productive?
The model contains five factors to manage of which three are positive and two are negative. The positive factors stimulate the broker to sell while the negative factors need to be managed to prevent brokers from misguided actions.
If we compare managing a yacht brokerage company to driving a race car, the driver would primarily use two pedals – the gas and the break pedal. In management of a brokerage company the gas pedal is composed of motivation, confidence and infrastructure. The break pedal on the other hand is represented by managing risks and expenses. If a manager wants to have a positive contribution to the performance of the company, the gas-pedal must be used much more than the brake-pedal. Wanting to control the brokers is like using the brake. If you have your foot down on the break most of the time and primarily focus on managing expenses and risks, there will be no progress and therefore no results.
Motivation is key to the success of a sales person. Commission and bonuses play an important role in driving sales brokers to concluding more deals, however there are more factors that influence their motivation. Brokers are sensitive for group dynamics. A positive atmosphere in an office will boost sales while a negative atmosphere makes brokers pessimistic in their approach to their clients. A charismatic leader, rather than a boss, with a clear vision will motivate brokers and employees. Brokers need to be constantly motivated, individually and collectively.
New brokers need time to build up their self-confidence. A manager can play a crucial role in developing his confidence by coaching and training. But confidence is not only an issue for rookies. Some brokers can be successful for a few years in a row and then suddenly stop selling because of all kind of reasons. They might have health issues or go through a personal crisis. Like an author can have a writer’s block, a broker can lose its magic to sell. A manager needs to recognise this and do what he can to restore the self-confidence. Broker’s confidence is also stimulated by a company pride. When a broker is proud of the brand, the marketing and the management he will perform better.
Besides motivation and self-confidence, a broker needs a good infrastructure to work in. The manager's task is to understand the brokers' needs and to implement a broad spectrum of tools, and resources must be adjusted to the needs of the broker to make them more effective. As you can see, the brand plays a double role: it is a tool for the broker to present his services but it also gives him confidence.
When you only focus on the needs of the broker, you might lose sight of two major factors. One of them is expenses. Brokers are only focused on revenues and they have a natural tendency to overspend (except if it is their own money). Marketing, entertainment of clients, travel and communication are the most important costs to keep a close eye on. There are proven ways to control expenses without jeopardising sales opportunities. Keep in mind that managing expenses is a negative factor and it needs to be balanced with the positive factors of brokerage management.
The last but certainly not least factor to manage is risk. A yacht broker can bring the company in real danger by misleading clients, unethical behaviour or by damaging the reputation of the company. The manager can put in place a number of protocols to reduce the major risks. Especially all contracts and agreements need to be checked before or after signing. Risk is one of the most difficult aspects to manage because a manager is mostly not aware of the details of the communication between the broker and his client. And it is impossible and demotivating to supervise every single action of every broker. A manager needs to create an open communication within the company so alarm bells can be heard on time. Brokers talk with each other and there is always feedback from captains and clients. A supportive manager will receive signals much earlier than a boss who is disliked by his brokers.
This leaves us to the question what kind of person are we looking for as a manager of yacht brokers? The manager needs to be esteemed by the brokers. Being the boss is not enough to deserve respect. It is a combination of charisma, market knowledge and relevant experience that will make the brokers look up to him.
Second, the manager needs to understand sales from his own experience, what it takes to convince a client, how it feels to close a deal and how frustrating it is when you are not supported. Third, the manager needs personal skills to motivate, coach the sales people and create a positive atmosphere in the company.
Managing yacht brokers is a subtle skill, just like driving a race car. The competition is harsh and everyone fights for pole position. Investors should be carefully picking their drivers to have a chance of winning the race.
This article was published in the latest edition of the SuperYacht Times newspaper. Subscribe now to receive your copy straight to your door and never miss another issue.