If brokers can add value at every stage of a sale and grasp the significance of longevity in their relationships with clients, they can most certainly justify their commission on sales. But a quality service, experience and product is only achieved if all parties involved in the construction of a new build work harmoniously and have a shared best interest for the client.
A conversation with an infuriated broker recently brought light to what he describes as a "complete conflict of interests", with "how brokers are remunerated for the commissioning of new builds."
"How many times has a shipyard turned around to me and whispered into my ear; ‘hey, remember who’s paying you'", he says. “It could be that you’re trying to sort out a client request, or a particular in the contract."
Queried as to whether it was (hopefully) a one-off, he says "It’s happened to me a few times now and hearing that is quite honestly a red rag to a bull. I'm working for my client and it's my job to protect him, so it is a huge conflict of interests."
Other brokers have made it abundantly clear that the aforementioned behaviour is exceptionally rare rogue practice. But it still raises the spectre of a conflict of interests when clients are being introduced to shipyards by brokers, who then receive a commission from that yard.
It is dubious that a shipyard can use a broker's commission - which is effectively included within the new build package that is paid to the shipyard - as leverage for a better deal. All parties are trying to achieve the best deal possible, as is the way in business, but getting the best quality product built for the client should, theoretically, be the main focus. Is there perhaps a better way of handling new build fees for intermediaries?
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