Who is?

Hi. I am a shipping company director, transport academic, author, family man and all round nice guy. I have worked as shipbroker, shipowner, freight trader and bulk charterer, in senior positions, with some of the largest and most disrespected (joke) companies in the world. Ask my advice on all things shipping and you will receive my blunt and always honest answer. Hang around to learn more about chartering and ship broker salaries, chartering and ship broker jobs, chartering and shipbroker recruitment agencies, cheap freight, maritime education, chartering and ship broker qualifications, become a ship broker, tips on how to be a successful bulk shipping executive, philosophy, Zen and the art of shipbroking, and much more. Yours The Virtual Shipbroker (recently proclaimed the guru of shipbroking) Copyright © 2009-17 by Virtualshipbroker

Friday, December 30, 2011

Good question from a reader

qte

So Samoa is skipping friday. If I were a charterer, and was trading the vsl around Samoa, how would this effect the payments i make to the owner? Do I not have to pay for friday?! Well technically that one friday doesn't exist.
 
unqte
 
haha - my guess is that a "day" is still 24 hours....so although friday disappears the 24 hours will still count
 
great question though!
 
Btw - to all those readers owed a reply from the Virtual Shipbroker - I am on holidays for a few more days. I realise there are quite a few of you expecting replies. Hang in there and i will revert soonest. Plus i have been in a prerpetual state of drunken stupor for over a week so adding anything to this blog in my condition is not a good idea. 
 
2012 will be the best year yet - of that I am sure
 
Keep Rock'n
VS
 
 

Monday, December 19, 2011

Shipbrokers 12 days of Christmas

On the 12 th day of christmas my therapist said to me

12 Phones are ringing
11 Ships are sailing 
10 Banks are calling
9 Pounds im heavier
8 Trading screens
7 Days a week
6 Figure bonus
5 ..........Failed on sub...........sz,....
4 calling (girls)
3 Hours sleep
2 bottles of gin

and a boss (or wife, or husband) who is never happeeeeeeeeeee.


HAPPY FESTIVE SEASON TO ALL (CHRISTIANS AND NON CHRISTIANS ALIKE)

Monday, December 5, 2011

Sign of the times

In this prolonged recessed shipping market we are starting to see some trends emerge.

Banks are getting increasingly nervous - News that more and more shipping banks (those that lend to the sector) are losing patience and are now refusing extra cash injections, rejecting new investment pitches, being inflexible on repayment plans and are in fact calling in some of the moneys owing to them from shipping companies no longer able to trade as going concerns.



The problem for banks is that they are claiming ships back from clients at a fraction of their market worth from a few small years ago.

So they help finance a ship for USD 50 million, market crashes and same ship is worth 20 million and their client files for bankruptcy.....with 40 million still owing. What would you do if you were the bank?

They are either selling them for only a small portion of their previous market value, or even worse they are sending them straight to the scrap heap for the price of a song (for older cheaper ships).

Demolition yards are reporting more business, which to be fair is probably a good thing for the mid term viability of freight rates which are too low...

Instead of selling the ships to others or sending ships to the scrap heap another option banks are increasingly looking at and in fact doing are keeping the ships and entering into chartering and/or management agreements with some of the industries more reputable (and solvent) players.

So option 3 is keep the ships on the books, charter them out and wait till the market improves the asset values ............and then sell them. The key for many banks is if they sell they lock in a loss...a massive loss.

So some financially strong players like Oldendorff and Klaveness to name a few a being approached to handle "distressed assets"........and one can only imagine that the trade off for a good counterparty would be very attractive rates, terms and conditions. So put bluntly the strong larger shipowners are securing lucrative deals that others cannot get near.....because of smart prudent management over the last 3-5-10 years..

And its not just the banks. Some shipyards have seen customers disappear leaving them to hold the new born babies........so instead of accepting much cheaper prices in the current gloomy markets they too are partaking in interesting chartering deals with shipowners (in order to avoid booking in losses). Charter deals between shipowners and yards are nothing new in both low (current) and high markets.

Economists call this process "consolidation"....the inevitable result of a sustained economic downturn where the smart, secure and cashed up survive.

VS

Tuesday, November 22, 2011

Should a charterer do business with a shipowner in financial trouble?

There are a number of shipowners / shipoperators around with less than healthy financial positions. Some of them are quite well known, the banks and creditors are onto them and they are treading a fine line hoping to stay afloat until market conditions change.

So the question is "should a charterer fix with a shipowner who is in some financial trouble".

Well theat depends.

First thing is this. The charterer is the one who pays the shipowner, so this is a prefered position to be in. You are the the one who owes the shipowner not the other way around. So yes i think from a starting point fixing your cargo to a fincially insecure shipowner is ok. What you don't want to be doing is fixing your ship to this same owner (to cover one of their cargoes) because they then need to pay you.......and this will be problematic. Especially if they are in survival mode.

Secondly for voyage cargoes, a financially strapped shipowner will more than likely be super aggressive which is great as the charterer gets a super cheap rate. The reason a financially strapped shipowner craves voyage cargoes is because of cashflow. If he fixes a voyage cargo he get 95% or 100 % cash upfront. If on the other hand the cash strapped shipowners opts for time charters he gets drip fed cashflow every 10 or 15 days.....which is not great for him.

So there is an opportunity for a win / win in this case. Cheaper rates for voyage charterer, cahsflow for owner on the skids.

The biggest problem you can have is if the ship carrying your cargo gets arrested. Then your cargo could be stuck onboard causing immense pain for months to come.
Never fix a long term contract with a shipowner unless they are financially sound.


Dont comma rockin if the repo man comes a knockin...(that makes no sense but run with it...)

VS

Monday, November 21, 2011

Personality Types

I have recently been quite interested in the idea of Personality Types and how your ingrained preferences can dictate just about every outcome in your life.

The most famous personality test is called the Myers Briggs test and it groups you into one of 14 distinct personality types and using this information it can predict / give advice about everything from most suitable jobs, suited partners and what hobbies you will probably enjoy

For me it has been a scary revelation. I am what is known as an INTJ personality type which is the rarest in the land making up only 1 pct of the general population. Whats interesting about INTJ's though is our over representation on the internet when it comes to financial blogs and blogs about early retirement. The INTJ is known as the "mastermind" and we like to find efficiencies and systems and then exploit them (in a good way) to our benefit. Certainly important for shipbrokers and charterers i would have thought.



Anyway - INTJ's make up approximately 38 percent of all financial bloggers accross ideas such as finance, realestate and retiring early. A massive over representation which is is interesting to me anyway.

But no word on whether INTJ makes a perfect Shipbroker - if there is such a thing, I actually think E type personalities are more likely to make better day to day shipbrokers as they are more social. But like most things there is room for everyone. As is said being efficient and finding holes in certain markets has certainly worked well for me.

Here is a simple 5 minute test..

http://www.humanmetrics.com/cgi-win/JTypes2.asp

Drop me a line and let me know what you are?

Cheers
INTJ VS

Monday, November 7, 2011

Possible new intake - exciting chance

The current crop of students in the VS dry cargo chartering and shipbroking certificate are coming towards the end of their 4 month course and from all accounts the course has once again lived upto expectations (and more).

A current student - "This course I will really miss and has given me huge confidence in my day to day activities".

Now just on that matter. My intention was not to run another course until early 2012 BUT I have had a handful of requests asking if there is any chance to start earlier - namely from the first of December.

For me I have some flexibility and it all depends on numbers. I need more than 2 students to make it worth while

So to those that missed out on the last intake here is your chance to fast track your skills sooner rather than later.

If any of the readers are interested in enrolling in my Shipbroking Certificate starting December 1st (final confirmation will depend on numbers) then please let me know within the next 3 days!

email; virtualshipbroker@yahoo.com

If no takers then we push it back to next year!

(btw the traditional christmas months are a good time to study as the markets wind down a little)

For further information on the course including format and cost just surf the blog and all will be revealed.

cheers
The Virtual Shipbroker

Thursday, October 20, 2011

Whats shipbroking about then?

As readers of the blog will know I run a consultancy business for anyone wanting highly confidential, expertise when fixing deals. And i Don't mean my real work (what I do for a living) I mean a Virtual Shipbroker Consultancy Business.

Virtual Shipbroker Consultancy click here

The great news is that a handful of really smart people have taken me up on the consultancy offer and are kicking huge goals.

Had two on line today with two different problems which really goes to the heart of what makes a great broker.

Both have problems. Both cannot get owners to offer for various reasons. One client has an owner who is aggressive on rates for a substantial coa (contract of affreightment) but on checking with agents see's that charterers have issues with surveyors and ships being rejected because of hold cleanliness issues. The other client cannot seem to bridge the gap of USD 2.00 between charterers ideas and the best offers he has from owners....

Guess what people - Welcome to shipbroking!

If it were easy everyone would do it. The best shipbrokers love "problems" because problems need to be solved and a shipbroker worth his commission can now ply his / her trade.

What is needed?

Good communication between all parties.

I often see fixtures fall apart because Principal A doesn't really understand what Principal B is doing - or why there is hesitation. Often the broker in between has no idea either. So a good brokers see a problem, get to the bottom of understanding the problem, and with the right "touch" find solutions which eventuate in a FIXTURE.

If someone doesn't see a problem, let alone understand how this problem can be solved - well.... they get nowhere.

This is where having me as a consultant comes in. I help see problems before they arise, help solve them, help make you money, help teach you in the process...

WIN / WIN....




Hire me! ha...

Cheers
VS

Tuesday, October 18, 2011

I haven't done a zen posting for a while

In Washington , DC , at a Metro Station, on a cold January morning in 2007, this man with a violin played six Bach pieces for about 45 minutes. During that time, approximately 2,000 people went through the station, most of them on their way to work.

After about 3 minutes, a middle-aged man noticed that there was a musician playing. He slowed his pace and stopped for a few seconds, and then he hurried on to meet his schedule.

About 4 minutes later:The violinist received his first dollar. A woman threw money in the hat and, without stopping, continued to walk.

At 6 minutes: A young man leaned against the wall to listen to him, then looked at his watch and started to walk again.

At 10 minutes: A 3-year old boy stopped, but his mother tugged him along hurriedly. The kid stopped to look at the violinist again, but the mother pushed hard and the child continued to walk, turning his head the whole time.. This action was repeated by several other children, but every parent – without exception – forced their children to move on quickly.

At 45 minutes: The musician played continuously. Only 6 people stopped and listened for a short while. About 20 gave money but continued to walk at their normal pace. The man collected a total of $32.

After 1 hour: He finished playing and silence took over. No one noticed and no one applauded. There was no recognition at all.

No one knew this, but the violinist was Joshua Bell, one of the greatest musicians in the world. He played one of the most intricate pieces ever written, with a violin worth $3.5 million dollars. Two days before, Joshua Bell sold-out a theater in Boston where the seats averaged $100 each to sit and listen to him play the same music.

This is a true story. Joshua Bell, playing incognito in the D.C. Metro Station, was organized by the Washington Post as part of a social experiment about perception, taste and people’s priorities.

This experiment raised several questions:

*In a common-place environment, at an inappropriate hour, do we perceive beauty?

*If so, do we stop to appreciate it?

*Do we recognize talent in an unexpected context?

One possible conclusion reached from this experiment could be this:

If we do not have a moment to stop and listen to one of the best musicians in the world, playing some of the finest music ever written, with one of the most beautiful instruments ever made . . ..

How many other things are we missing as we rush through life?

Enjoy life NOW .. it has an expiration date

The Virtual Shipbroker

Thursday, October 13, 2011

My email was spammed

Sorry to any/all of you that received an email from me with spam...its a virus and i picked it up quickly so hopefully no more to come...

vs

Tuesday, October 4, 2011

technical problems

Quite a few of you, lncluding myself, are having issues posting on the blog.

I think blogger are having some technical issues which hopefully be fixed soon.

cheers
vs

Sunday, October 2, 2011

Spoofing

One of my students has asked the following

qte

VS

What do you think abt spoofing? Ofc i do not spoof. I often catch out other brokers spoofing or that indicate without authority.

My close principals and i realize very quiclkly when this happens.

What do you do in this case, do you communicate to the other principle?

Thank you in advance

qte



Anyone care to offer a definition of spoofing and give this person some advice. Its a great question and deserves some discussion

cheers
The virtual shipbroker (tackling the questions others fear to answer)

Sunday, September 18, 2011

The VS certificate rolls on

The great news is that none of the current students have decided to drop out after the two week grace period and by all accounts are enjoying the program alot.

So who are the current students? People always want more info.....to satisfy curiosity...which is cool.

Can't tell you specifics but can say this
  • 8 in number
  • 7 males
  • 1 female (first one wahooooo)
  • 1 of the 8 has elected to do the course anonymously
  • 2 from chartering companies
  • 6 from brokers (including 3 of the big 6)
  • 2 from South Korea/Japan
  • 1 from Australia / NZ
  • 4 from Europe
  • 1 from South America
  • All pioneers with a entrepreneurial spirit
  • All with varying degrees of knowledge and experience

As i have said to the students. Kudos to them - It takes some courage to hand over close to USD 1,000 to an anonymous blogger. It is entirely possible I could take the money and run never to be heard of again. Highly unlikely though and these guys are smart enuf to understand risk vs reward. Not only is this the cheapest, most hands on course in chartering and shipbroking, you also make amazing contacts which is worth the price of admission alone.

Next intake wont be until well into 2012....incase you missed out this time.

Cheers
VS

Answer to the question on previous post - can a shipowners cancel?

Once again thanks for the great question and thank you to the many contributors who pretty much answered the question perfectly.

Note that im not a lawyer and without knowing the exact circumstances and charterparty clauses.

I do however offer the general opinion that -  a shipowner cannot cancel a contract under these circumstances but fortulately is protected by way of demurage / detention clauses (in the cp).

Legally speaking demurrage or detention constitutes DAMAGES awarded against a charterer for taking longer than stipulated to load or discharge a ship.

The question of whether the damages fall under 'demurrage" or "detention" probably depends on the circumstances and also on the cp.

There is a great lesson here for shipowners. This is a story about delays but it is also a story about sound ship trading practice.

Although a shipowner cannot be expected to premeditate every move in the market, a shipowner / ship operator when fixing a cargo with say a laycan 3 weeks away needs to consider many things

1. The current voyage he is undertaking and the likelihood for delays

2. The charterparties for both the current and next voyage and whether there is flexibility or even scope to cancel the contract. What kind of laycan cancelling clause have you used is another example of smart cp negotiations skills that can help you before a problem arises.

3. Current market conditions......if the market is about to explode best to fix a cargo that you are certain will run smoothly and quickly so you are set to take advantage of the next opportunity

To name a few..........

If the market were to drop (instead of rise during the voyage period) the shipower would be very happy with any delays locking in a damages claim at higher than current market levels. So it goes both ways.

In a game of poker - sometime you win, sometimes you lose. Advice to the shipowner is "limit the damage and move on"!

cheers
VS

Wednesday, September 14, 2011

A great question - can a shipowner withdraw a ship if cargo is late?

From a reader

qte

Can shipowner cancel the contract or witraw from it if the delay is caused by the charterer (for example: the goods intended for loading are not ready)? The delay prolonged the time beyond stipulated laycan, and the shipowner has next contracted laycan for another charterer so he should cancel this C/P to acheve the next one.

If this is the case, does the shipowner has a right to charge the charter the deadfreight or some kind of compensation for losing time due to chartere's delay?

Thanks in advance.

unqte

Anyone help this person out???

Free beer for any right answer..

Monday, September 12, 2011

CO2 fitted ships

One of my current crop of students has asked a good question. What constitutes a CO2 fitted ship?

Not all ships are fitted with a CO2 fire fighting systems in their cargo holds. The systems are quite expensive and those ships that are fitted are able to load combustible cargoes that other ships cannot. Cotton seeds are one such cargo.

Sometime these ships command a premium in the market..

The details

The Co2 system consists of a fire detection system (smoke detectors) and an alarm system, along with Co2 cylinders. During an indication of fire in the cargo hold, the gang of co2 bottles are released depending upon the cargo permeability (how much space is empty over the cargo for co2).

When there is a fire in any of the cargo hold compartments, the smoke is sucked into the sampling pipes and is passed through diverting valves in to the wheel house, thus warning the bridge personnel about the fire. Simultaneously, the sample from the pipes is passed over a smoke detector which senses the smoke and activates the audio visual alarm indicating the outbreak of fire.

There are other fire fighting systems available to shipowners but the Co2 system is easily the most popular...

++

Re current crop of students.

A great mix from some of the worlds largest brokerage firms and even a few cargo charterers aswell. To those who didn't enrol you missed a chance to network with people controlling millions of tonnes of cargo. And those cargo principals who are thinking of enrolling next time.....you should. Its a great way to improve your knowledge, expand your horizons and make friends in other fields...

Great fun and this is a really good crew to teach..

We all rock

VS


Thursday, September 1, 2011

Volatility - Handies vs Capes

Why is it that the smaller ship market segment is less volatile then larger sizes?


Good Question  (see previous post) and some excellent answers.  Thanks for the contributions and you are all spot on. And btw Gambalistic will go into my linguistic repertoire from now on! Love it...
++

Here is my take

The markets for larger ships have been more volatile than smaller ships for following reasons.
1. The market for larger ships is dominated by a small amount of larger players. This means that any significant change in market conditions will result in large market fluctuations. In shipping speak this means 3 things. The market is dominated by a) China b) coal and Iron Ore and C) Larger corporate style shipowners who control more than a handful of ships.

2. The market for smaller ships is dominated by many smaller players. This means that any change in market conditions does not necessarily affect the price of ships to a huge extent. Smaller ships go everywhere and carry everything. There are thousands of shipowners some controlling just one vessel and therefore unable to be a price maker in any way.

3. The world has built more larger ships than small ships, over recent times. Meaning that an over-supply of larger ships has led to a weakening market. Smaller ships, until recently, were being ignored by major players and are now facing catch-up. This means that a relative undersupply has meant firmer rates.

4. Larger ships and the trades they pursue are more likely to get involved in congestion issues, leading to decreased supply and more volatile rates.

Hope this helps. Anyone else care to add more reasons feel free. Any more ripper questions keepem coming.

The Virtual Shipbroker

Wednesday, August 31, 2011

Great question from a reader - who has an answer?

qte
 
Hi VS,
Read your blog on the regular, and have a question I've been wanting your opinion on.
Why are smaller ships (e.g. Handysize) more resistant to both upside and downside risk than their larger cousins?
A simple viewing of charter rates of dry bulk vessels shows capesize are extremely variable where as the smaller you get the steadier the graph.
Would love your opinion.
Thanks in advance.
Felix
 
unqte
 
Ok - Ill leave this one open to readers. Anyone willing to agree and offer an opinion why this is the case?
 
Cheers
The Virtual Shipbroker
 
 

Thursday, August 25, 2011

Study with the Virtual Shipbroker

Have to say that I have had amazing response to the upcoming course.

Reminds me how global the industry is! Also testament to the course are the applicants from some of the worlds largest shipbroking and chartering firms. It seems this humble little "hands on" course is gaining growing acceptance from shipping more established players.

Personally I am not surprised. In a stagnant / slightly depressed market, any personal edge is worthwhile.

For those who have sent me emails with expressions of interest I have replied to most of you and will be sending out official offers to enrol in the coming weeks.

For those of you still considering if you want to enrol there is still time but you will need to send me an email pretty soon. Need to know who you are and why you would like to be a part of the study program.

As an aside its great to see that the market has jumped a little lately. Onwards and Upwards!

Yours
VS

Sunday, August 7, 2011

VS Dry Cargo Certificate - New intake coming soon

(Costs added below)

I have had alot of interest recently enquiring about the next intake for the above mentioned course.

Below is typical of the emails I receive

This one from a trainee with a shipping company in Continental Europe

qte

Unfortunately, this is not what i have imagined, they are so busy so they can not spare time to teach me and again, mostly, i have to learn everything by my self... and not everyone teach me honestly. I know that there is people that they do not like young men, they try to teach us slightly and wrongly so we can never be like them.

unqte

I hear ya! This was my experience as a young person aswell. And those that do have a formal trainee program IMO take too long to get to the NUTS and BOLTS.

I maintain that a new entrant with proper intensive training should be able to start fixing ships within 3 months. Its a no brainer!

++

Anyway - the course has been highly successful with over 20 graduates since its inception 2 years ago.

Check the study tab above for full details of what to expect

++

Whats the scoop?

Next Intake - I will be calling for applications sometime in the next 3-6 weeks (keep an eye out), for a start shortly after.

Cost - No change since last intake: USD 975.00 (USD 925.00 if you have already purchased the books)

Feel free to email intial interest anytime you want. Will help me get a grasp on numbers.

Keep Rocking

The Virtual Shipbroker

Sunday, July 31, 2011

Who pays commission?

Pasted from a previous thread example-of-difficult-client

Quote

The Virtual Shipbroker said...

I am often heard to mutter the word GOOSE when talking about principals and competing brokers but in a slightly different context to what Suraz alludes too above (but thats a whole different story).

But yes Suraz - at the end of the day the shipowner may be the one writing the checks but it is the charterer who actually pays the "price" of a commission. They pay the price in the form of a higher freight rate or higher TC rate charged by the shipowner. Its factored in the cost. So if a shipowner cries foul about paying your brokerage remind them that surely they allowed for 1.25 percent in their calculations before they quoted on the business! One thing is for sure - nothing in shipping is for FREE - the idea that shipowners would pay a brokerage (without somehow getting it back) is naive.

Cheers
VS

unqte

VS

Wednesday, July 27, 2011

Awesome

Received and email from a friend of the blog

quote

VS / ...........

Tks so much for your help, i've got a job as a trainee shipbroker and have gone through the cp admin and post fixture now I'm officially a shipbroker and have since fixed my first 4 fixtures.

Just wanted to let you know how much you've helped me and I wouldn't be so successful without your help back then.
When my boss actually asked me how I knew so much about chartering when i just started, I just laughed and told him to refer to virtual shipbroker.

unqte

SLAM DUNK BABY!



Yours
VS

A sad week

Our thoughts are with the Nation of Norway. A nation close to my heart in many ways. A proud and fair people...........they deserves better.

+++

On a lesser note

RIP USD! (for the time being anyway)

My books are 20 percent cheaper now then they were when they were written all due to your devaluation against most of the worlds economies.

So it was time to cut my losses. I have taken the plunge and now all my books are for sale in Euro's (at the equivalent prices).

Its a crazy economic environment out there and who knows whats in store for most of the worlds leading currencies. Just heard a fantastic speech from the French head of the IMF Christine Lagarde and she describes how the worlds growth is very patchy and disjointed at the moment. A juggling act that threatens stability should a few elements fail to fall in line.

Good SUSTAINABLE eeconomic growth across all the worlds regions is what we need.  

VS

Monday, July 25, 2011

A real example of a difficult client

(if anyone has an example of a difficult client send me the deatils and I'll post it....(change the names / places etc so you dont get shot!)

Now mine

I'll give you a condensed version

Principal is a shipowner and we have a small contract. But alas I really represent the charterer because that is where the power is (eventhough the shipowner is paying my commission).

The shipowners is doing very well from this contract but the charterer is asking for some flexibility that is technically out of the scope of the contract. There are production issues and the charterer needs some laycans to be adjusted.

The shipowner in question can sometime be a bit shortsighted and does not like to change anything from the original contract - even if the changes are not necessarily bad. He just doesn't like change. So we have been going back and forward, with raised voices, and the often reminder that he is paying my commissions...

Eventually things got sorted, and sure enough all is ok but THIS client always gets his pound of flesh.

I also win because he realises that this is a great paying client and that the charterer has my trust. The shipowner is paying my commissions BUT this charterer always chooses which broker to use - ME! WAHOO!!!!!!.



That's actually a very interesting point............who pays commissions? The shipowner or the charterer? The answer is not always as straightforward as it appears on the surface.

Stick around and I'll explain in another post

Monday, July 18, 2011

Turn a negative into a positive

Shipbrokers are in the business of providing a service and with that comes the usual ups and downs of dealing with people with varying needs and personalities.

I want to relay a common situation that I have become increasingly good at dealing with. THE DIFFICULT CLIENT!

Maybe if you had good ships I could find you a cargo!

Once upon a time, if a client seemed unreasonable for whatever reason - I took it personally. This would then manifest in negative thoughts about both the client and my ability to deliver. Here is what I do now. If a client is difficult and I mean UNREASONABLY difficult - i see this as a great opportunity. I am talking about the irrational client. The one where the PROBLEM was not your fault but somehow you have ended up taking some kind of blame.

Heres the thing. I love it when I get blamed for something that is irrational...why? Because in the cold light of day, when the sea's have calmed and even the most emotional of clients has calmed down they experience another raw emotion...GUILT! And guilt, if managed properly, can be worth alot of money. The payback may not be immediate but mark my words a broker is often on the receiving end of a guilt deal, from a principal who regularly flies of the handle with little or no cause.

So my advice with difficult clients is NOT to fight fire with fire. Act rational and measured. Don't let them walk over you - but don't mirror their behaviour either. Find that middle ground that will have you looking good and build a relationship that will stand the test of time.

Now thats good broking

Cheers
VS

Tuesday, June 7, 2011

A tip for shipbrokers and shipowners

Ok - in the spirit of the Tradewinds article here is a tip for shipbrokers and shipowners when dealing with SOME charterers. Not all charterers mind you. This post does not refer to experienced charterers but rather the 'less than experienced' kind.


Many importers and exporters have no idea when it comes to chartering. They may bluff a little but truth is they just don't get it - this despite spending millions on shipping. These types of charterers include mining companies, agri business's, many trading companies, importers and the like.

They think (wrongly) that organising a bulk ship is like booking in a shipping container. How hard can it be... right?

Anyway - these are also the guys that many shipbrokers and shipowners fail to understand properly and this means lost opportunities. (Ignorance is a service providers best friend)

Many shipping people just can't help themselves when it comes to jargon. The quickest way to turn off a potential client is to start using terms like 'shinc', shex', 'disponent owners' etc etc. Many customers do not even realise that they are called 'charterers' in shipping speak.

So rule 1....know who you are speaking too and use appropriate language. Dumb it down. Instead of saying SHINC explain that 'the port never sleeps'. Instead of saying 'charterer' - use what how they see themselves ie either as an EXPORTER or IMPORTER. Instead of using 'charterparty' call it a 'shipping contract'.

Those kind of things go along way. Its called empathy! In my travels I organise information lunches where I would spend 1 hours talking about shipping jargon. Make it fun (over a beer and wine) explain concepts, terms and even tell them how the process works, including all the players from shipagents through to stevedores. When you open up this WORLD to non shipping people - they get hooked and you inturn hook a customer.

Rule 2. Depending on the situation don't always call yourself a broker or a shipowners. To many mining companies I refer to myself simply as a 'shipping company' or a 'shipping consultant'. The term 'broker' conjures 'commissions' and 'people of ill repute' even in Freuds day. Use when appropriate. Shipowners you should be pitching yourselves as JV business partners helping 'clients' (not charterers) build new markets. At the end of the day the shipping component can make up 15-30 percent of a clients 'landed costs'. If this isn't fodder to build a 'business relationship' then I don't know what is.

So there you have it - one for the other side (my side).

VS

Sunday, May 29, 2011

This post from 4 months ago didnt get any recognition (from me)

And it deserved more!

Great post

Crowsnest said...


Dear VS, stumbled across this blog whilst googling 'address commission' and thought 'wow, now why didnt i think of doing that!'. I intend to be a regular visitor and poster!

regarding the question of timecharter versus voyage, there is no doubt that the timecharter is potentially 'leaving money on the table' - which is what permits the role of Operator who will timecharter ships and fix business on voyage and hope to make some buckaroos in the middle.


As has been mentioned above, the key element is the amount of risk involved. The voyage charterer may earn what appears to be a big juicy freight but gets penalised by rain and bad weather whilst the timecharterer just wakes up every morning to another day's hire in the bank!


The voyage charterer must pay very close attention to cash flow - his ship may be waiting one month to load yet he will only receive the freight after loading completed, and the demurrage sometime thereafter. Meanwhile he must pay hire every 15 days to the owner from whom he has timechartered the vessel - not to mention having to pay hire in advance and a very substantial lumpsum for the bunkers upon taking delivery.


A voyage charterer must have a keen understanding of all operational aspects of the trade he is involved in. This means having his own team of in-house experts and reliable locals on the ground. The Owner who deals only in timechartering out his ships can operate with just a broker and an accountant and has plenty of time on his hands to work out the best moment to buy or sell another ship.


There are also the financial animals (such as publicly quoted companies on Nasdaq) who buy ships against long term period timecharter contracts - they have little interest in the daily excitement of moving cargoes around the globe. They just want to see a good (safe) return on capital. A period timecharter (to a first class charterer) is a bankable asset.

and so on.......personally I prefer voyage business because it allows the broker to really exercise his profession and bring his skills to bear in a way which will enhance his principal's profit expectations. If we brokers just act as post boxes then our profession (like the physical postbox) is doomed to extinction !
keep up the good work VS


End qte

Great work!

Friday, May 27, 2011

My work is done - well almost!

I have reached the pinnacle of my aspirations. First I can count Alain de Botton as a reader of the blog (tick) and NOW I can finally say that I have had an article dedicated to ME in none other than "Tradewinds" - the worlds number one shipping newspaper.

Here is the article from last weeks (20/05/2011) paper (notice the last line)


Quote


Blog reveals Achilles heel of shipowners


Hardcopy PDF

On the Watch has stumbled upon a frankly worded blog that offers some honest insights into an opaque business: shipbroking.

One recent entry on “The Virtual Shipbroker” (http://virtualshipbroker.blogspot.com) claims that when it comes to dealings with shipowners, “flattery will get you everywhere”.

The wisely anonymous scribbler claims to have recently done some consultancy work for a commodity exporter that involved running a tender and successfully negotiating the freight rate down by over $5 (generating a total saving of around $200,000).

The client was “flabbergasted” at this amazing feat given the owner had not intended to budge an inch.
However, our blogger turns out to have been an owner himself for many years, “so I know how they think”.

Then comes the juicy stuff where he details the must-know facts.

Firstly, shipowners “like to be flattered. Tell them that they have been chosen specifically and that charterers have been keen to fix with them for a long time. Massage the ego. [This is] standard across all industries!”

Next, “shipowners and ship operating is extremely competitive. Therefore they are always looking for new business. Promise the world — tell them that this is ongoing biz for the right owner!”

Thirdly, “find out who they compete with a lot and tell them that they are $2 cheaper! So if Shipowner X is always competing with shipowner Y in many markets, then play up to this. By telling them that their mortal competitive enemy is $2 cheaper, then they will surely sharpen their pencils. The other thing is this: shipowners and freight traders find comfort in numbers. If they hear that three or four other reputable shipowners are also offering on your business at these cheap rates, then somehow they can justify this internally. So play up to that! It’s not lying — it’s poker”.

So there you have it. The art of shipbroking in a nutshell. But lest our blogger be accused of partiality, he wisely wraps up with: “This post is to give one back for all the unsuspecting charterers out there who have been flummoxed by the super-clever shipowners. Sorry shipowners — next time I will let you in on a few secrets into what motivates exporters and importers.”

On the Watch has a gut feeling this anonymous broker is none other than... but you’ll have to wait until next week to find out.

Unquote

Haha - Nice try Tradewinds - trying to increase circulation through bating the reader that my true identity will be revealed the next week. Well that time has actually come (next week is here) and sure enough nadda...I am still free to walk the halls of the baltic without being mobbed by sycophants and ladies of otherwise good repute.


I actually offered my services to Tradewinds (6 months ago) as a freelance colour writer but haven't heard back. If you think that VS should write irreverent articles for Tradewinds then send a email to the editor suggesting same. Go on I dare you!

Yours
VS

Thursday, April 21, 2011

Im still here - don't worry

You know how after working so hard on a project for a long period of time there comes a moment when you say 'I need a break'. It kind of creeps up on you like the flu. It reminds me of my time studying full time at University. Come the end of year, exams out of the way - you don't want to look at a book, pen or computer for 2 months. We need these breaks!

I have been blown away by the continued interest in the blog whilst taking this sabbatical. I check my emails every 2-3 days and sure enough the comments keep coming, the books keep selling and surprisingly my google analytics say that the readership numbers havent dropped at all. This is surprising because bloggers need to keep engaging their readers or the readers will get up and leave.

I think this is testament to a few things

1. There is so much 'content' on the blog that people can keep coming back and learning something new everytime. I tried to make a post every few days and I also tried to make each post interesting.
2. The general interest in shipbroking and chartering keeps growing.
3. There is no other site that tells it like it is....most other shipping websites are run by named people who have an interest in the status quo. They have reputations that involve not upsetting people. I on the other hand are anonymous and therefore provide unbiased views on the business.

A big thank you and HELLO to the new followers. Thanks for taking the plunge to show support for the blog.


To those of you who have sent me private messages checking on my wellbeing - many thanks. Im just chilling, laying low and enjoying myself on a few other projects.

To the person who offered USD 10k to have me fly out for a weekend of tutoring and a game of golf. Thanks - maybe down the track.

This blog aint going nowhere and I intend to add to it and develop it moving forward - maybe at a slower pace than previous. Blogs last forever in this modern word.....its a footprint. Probably last longer than all of us. Respect...

Geez - I should write when im feeling nostalgic.

Sincere thanks to all for your continued support

Keep Rocking

The Virtual Shipbroker

Tuesday, March 8, 2011

The Kings Speach

As a shipbroker I have spoken to kings, princes, presidents and prophets. I know what its like to get tongue tied and stuff up my lines. It can happen to the best of us.

It can also happen to the worst - click here

Mike Tyson - Speech Therapist

Wednesday, February 23, 2011

Woman in Shipbroking

I have bumped a posting made in another thread - good reading

quote

pilarin said...


Comments from a woman shipbroker: It’s true, most men in this field tend to look at women as an employee who is not much more than a highly skilled secretary which of course is not true.


Men have their way of dealing with things and women have theirs. This is a job that requires many skills which are most certainly part of the female way of thinking and acting.


The real question is if a woman is up to working 24/7 doing something that is stressful but rewarding (when the damn deal is finally closed).


If you like challenges then yes, you can do it and men will eventually realize that you are a good professional.


But the fact is that many companies only hire men brokers… I say it’s their loss…


Meantime I have received info that a women shipbrokers net is coming together which should be able to support the ladies in the industry… we will see…


February 23, 2011 7:31 AM

The Virtual Shipbroker said...

Hello Pilarin - thanks for the well considered comments. From a guys perspective I actually agree that many shops are disadvantaged by not having woman in broking positions. You need a balance and with the ease of offsite communication it allows more flexibility for those woman (and men) that may need it for family reasons. I personally dont like spending ALL my time with men. Its unnatural....for 12 hours a day 50 weeks of the year.


Shipbroking doesnt need to be WAR or a prison cell. One can actually go to work, do deals, and have a balanced life.


Good luck to the female shipbrokers network. If you want me to speak at one of your functions (from a guys perspective)let me know!



Cheers

VS



February 23, 2011 2:53 PM

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Sunday, February 13, 2011

Im Back!

Hello Everyone - Sorry for my absence. Been a crazy time

But Im back. Whats been amazing is that even though I havent posted anything for 2 weeks I have had a recond number of book sales, tuition requests and Resume requests.

Unfortunatelyy due to my busy schedule I havent been able to reply with my usual pace. I am slowly catching up.

So the million dollar question is 'Hows the Market"

The short answer is that its crap! We will see a period of contraction no doubt. Clarksons have closed down their financial services arm for one reason - on markets drop those that arent making money (or eating up cashflow) get the chop. Be that people, departments and even entire companies.

Those that are highly leverage (debt) will be worried at the moment. The GFC drop although painful had very few casualties - for one main reason - the BDI bounced back reasonably quickly. I fear that this downturn could be a little more long lasting. Some scribes saying the market could be flat for 4-5 years.

This is pure crystal ball gazing. NO ONE really knows. The best thing anyone can do is stay positive despite the market. You cant control the market - you can only control the way you react to it. Try and see everything in a positive light - if you lose your job - be thankful that it gives you the chance to find another job NOW. Could be better than losing your job in 6 months time when and if there are more job losses than now.

Im not saying there will be massive job losses - just that restructuring WILL happen. The musical chairs has already begun and people will be looking for security of tenure going forward.

And for those looking to get into the industry - its not all bad. Many companies hire trainees in downturns because they are cheaper.

So heads up everyone - the sun still shines. Egypt and fallen and I predict will rise again bringing a new age of shipping freight rates with them..........and so it goes!

Adios

VS

Saturday, January 29, 2011

Revolutions everywhere!

To our friends in North Africa and the Middle East. Stay safe and we wish you well with whatever transpires in you home states. I have many readers from the region.

I wonder if this event would have been possible (this combined consciousness across a few countries) had it not been for the Internet and the ability for the countries citizens to access information that is leading to these uprisings. I think this may be a good thing.

I dont pretend to know the issues in all the countries involved. As always it seems complicated.

Its a crazy time and out thoughts are with you.
Yours
The Virtual Shipbroker

Thursday, January 27, 2011

Open Questions Thread

I will use this thread (and put it in favourites) for any open / random questions people want answered that aren't necessarily linked to my posts.


If no one has any questions then thats cool too - I can go back to sleep!

Monday, January 24, 2011

voyage charter vs time charter question

Bump from another thread

Good question

qte

Anonymous has left a new comment on your post "Readership growing":
I have a qn VS, hope to hear your view.

Why does voyage cargo always pay better than a time charter trip? Is it due to better control over the costs?

unqte

There is a huge assumption here that shipowners prefer voyage charters over time charterers because they ALWAYS pay better.

Anyone care to offer an explanation / comment?

VS

Vs dry cargo chartering and shipbroking certificate

Ok people, due to popular demand I am rolling out the 3rd edition of the overwhelmingly successful (yet humble) VS dry cargo chartering shipbroking certificate.


This post is to ask for any requests for enrollment.

Details

Start date: 07th February 2011
Request for enrollment date: Friday 28th January (must be in by then)
I will let you know if you have been successful within a few days

Cost: I have decided not to increase the cost (despite the poor USD) for this intake. Next intake (midyear 2011) will most probably be slightly more expensive.

Those of you who have already contacted me with enrollment requests could you please send me a one liner confirming interest.

Subject to total class numbers
Check the blog link for further details http://virtualshipbroker.blogspot.com/p/study.html

Yours
The Virtual Shipbroker

Friday, January 21, 2011

Basic shipbroking 101

My current crop of students are completing there certificate by taking part in their final virtual negotiations.

The process reminds me that many juniors over think things. Remember that a brokers central role is to 'pass on' information from one party to another. Pass it on in a timely and accurate manner - full stop. Leave the interpretation and salesmanship once you have done a few deals and you can read the situations better.

Keep it simple - pass on the info and stay out of trouble - junior brokers! If you are unsure about an element ask your boss or drop VS an email - ill help out...

BTW - the next intake will be forced back a few weeks. I will be announcing details of how people can make an request for enrollment over the next week or so.

Yours VS

Thursday, January 20, 2011

Readership growing

Over the last 3 days this blog has broken a few readership records with over 600 individual hits on each day. Still humble by google standards but great for a brokers blog.

Incase yu were wondering - the top ten for last 7 days

United Kingdom 484
United States 437
Singapore 408
Greece 272
India 153
Australia 124
Canada 81
Denmark 72
Spain 71
Netherlands 53

Thanks for reading!
VS

point of clarification

It has been mentioned by someone to me that there may be a persepction that i delete blog comments from others that I dont like.

Its true - I am able to moderate (delete) posts that I dont like. Luckily for me I have deleted a grand total of 4 comments in 2 years of operation.

Yes a whole 4!

Reasons

1. if someone tries to sell something in the comment ie there is a link to a product. Yes even a past chairman of the ICS who sent me blog message for publication - included in his message a link to his own consultancy business which i deleted. I get many people who only make comments as a way of propomting their own businesses. Its a standard way for interenet marketers to try and increase readership and advertise for free and well patronised blogs. I wont allow it.

2. If someone is abusive (happened once)

3. If someone asks a question that has been repeated many times

4. If it is obvious that the person has an agenda other than to advance the discussions important to shipbrokers.

Incase yu are wondering in 2 years I have had no negative reviews to any of my blog posts, books or software. None that I have seen or that I have moderated anyway. That certainly does not get vetted. Ask around people like my books! I cant help it. Not one request for a refund except on a software that we had trouble on one computer.

Many people send me private messages and we have discussions on a private basis regarding interesting topics which is great. But when someone sends something deliberately antagonistic and wants it to be published then it wont happen.

And btw I only publish a 1/10 of the compliments my books, blogs and course get. I dont wanna bore yu.

You be the judge - follow your instincts. its all good.

keep rockin

cheers
VS

Should VS Twitter?

Im not convinced but alas I have set up a twitter account. I havent done a tweet yet (do you really want to know when im sitting on the toilet reading tradewinds?) and yet some of you have tracked me down and asked to follow my tweets....which appreciated.

My wife says I have nothing useful to say and my kids dont seem to understand my basic instructions so im not sure I am the tweetable type.

You never know...if i tweet I will tell this blog so that yu can all decide if you wanna follow or not.

cheers
VS

Wednesday, January 19, 2011

A good question - Females as shipbrokers!

NatC writes

Anonymous said...
Hi VS,
I am wondering in the line of shipbroking, whether there is any discrimination against females?
You see, I'm interested in this line, but I've heard that companies often preferred males due to the need for shipbrokers to engage in "entertainment"..
Is this true? And if it is, may I know what sort of entertainment is in store usually?
BTW, u have a great blog, keep it up! :)
Cheers,

nat.C


unqte
 
A good question Natc. I have a view on this but what I would like is for some of my female readers (those in the industry) to maybe share their views regarding woman in the shipbroking workplace. Men out there are also welcome to have a say. Reminder you can do so anonomously if you wish because its an interesting topic and the VS blog is the only platform that will enable these interesting topics to be discussed.
 
Come on - I dare you!

VS

Tuesday, January 18, 2011

Sunday, January 16, 2011

Force Majeur

Hi all

The reason for my absence is that i am caught up in this Australian flood disaster. Force majeur issues abound and I have been travelling around trying to keep people sane. Back soon I promise. I realise i owe many of you replies to some important questions and it annoys me that I cant reply. Sorry!

Yours
The virtual shipobroker

Monday, January 10, 2011

Awol

Sorry everyone - I am awol for the next few days - a short notice thing.

All those expecting replies from me hang in there for a few more days

Yours
VS

Saturday, January 8, 2011

VS Dry Cargo Chartering and Shipbroking Certificate

I will be announcing a new intake (February start) shortly.

This just in from a current student who has 2 years experience in the industry.

Qte

Even thou I work as shipbroker I learn A LOT in every single task.
You were right; this course is absolute perfect for me!

Unqte

For more details check the link by clicking HERE

Cheers
VS

Friday, January 7, 2011

The changing face of cummunication

As discussed previously, shipping has a whole language unto itself. The Genesis of this language, apart from maritime terms, was the need to abbreviate everything in order to cut down on communication costs.

Here is an interesting titbit for newbies (and by that I mean 10 years or less in the industry)

When I started 20 years ago not only was there no facebook, google or WWW - there was no email and no mobile phones.

Now 20 years ago aint that far away. Ryan Giggs was playing first team football at Manachester United and Shaq was midway thru his college basketball career. Both are still playing.

Communication was mostly done via Telex machine, although fax machines were becoming more popular. Telex machines had been around for ever and were used during the great wars to communicate battle conditions (there is every chance I made that last bit up but you get the vibe!)

So sending a telex was a big deal. very expensive. There is no way you could send your clients ships or cargoes to hundreds of brokers or principals around the globe. You would go broke the cost was so high. So back then you needed to be much more selective and think about who you sent messages too and what you said in those messages. Those of us around at those times sometime look back with nostalgia especially in this age where communication is almost too easy and cheap making what is written somehow less important (more disposable).

Telex machines played a crucial role in the office hierarchy. The trainee would be the telex person. Every time the telex machine made a noise the trainee would be up of his/ her seat to check the latest message. if it was a new ship or a new order it would be the trainees job to yell out the details to the more experienced brokers who would then jump on the phones and make those important first calls.


Telex machines


The offices I worked in had colour coded telex machines. Top copy had a red trim, Second copy, blue, third brown, fourth yellow, fifth white. The boss always got RED and down it went so that it was the trainee left with the plainest of all copies. Back then - all this type of stuff was important - to some anyway.

I just wanted to fix.

Communication costs back then as a percentage of overall company costs were probably around the 30 percent mark - falling slightly behind salaries. The cost of communication is now much lower by comparison.

I think Ill take of my Tweed Jacket, have a cigar and listen to my favourite Vinyl Pearl Jam record on my 1980's vintage phonograph.

Happy fixing

VS

Monday, January 3, 2011

Welcome to 2011

With the power vested in me (as the sage of shipbroking, the lama of liberia, the ayatolla of passing gibraltar) I now pronounce 2011

The year of the shipbroker.

Under seige for sometime from cranky shipowners, cantankerous charterers, a falling US dollar and a plunging baltic dry index - its time to take stock and be thankful for all the good we (collectively) as shipbrokers, can look forward to, in the year that will be 2011.

The sun will still rise, ships will still sail and the world will not end (atleast until 2012).

In what could be humankinds penultimate year (if you believe the conspiracy theorists) lets make this one a year to remember. Celebrate your wins with more gusto then usual. Ring the bell until your ears bleed. Dont sweat on the small stuff - leave the gossip at the front door.

And while youre at it

Climb that mountain,
Dive that reef,
Run that marathon
Shag that (sorry i mean love) that person like you have never loved them before

Because people - we are SHIPBROKERS!

Say it - "I AM A SHIPBROKER AND I AM PROUD"!

Stand on your desk and scream it at the top of your lungs - "I AM A SHIPBROKER".

Do it - Do it NOW!

Ok - anyone feel better?


Can courstesy of the Virtual Shipbroker

HAPPY 2011

VS