I am doing some consultancy for a raw commodity exporter. They / We ran a tender and I managed to to negotiate the shipowners freight rate down by over usd 5.00 during the course of the negotiation (and saved them around usd 200,000). The cargo was from the Black Sea
The company was flabergasted and asked me how did I know that the shipowner would keep reducing their rates - when from the very start of the negotiation they declared that they could do no better than X amount!
The key here is that I was a Shipowner for many years so I know how they think!
Many charterers and brokers fall into the trap of thinking that shipowners have fixed costs and cannot reduce rates. This is not technically true.
Here are a few things you should all know about shipowners
1. They 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. Standard accross all industries!
2. Shipowners and shipoperating is extrememly competative. Therefore they are always looking for new business. Promise the world - tell them that this is ongoing biz for the right owner!
3. Find out who they compete with alot and tell them that they are USD 2.00 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 competaive enemy is USD 2.00 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 3 or 4 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! Its not lying - its poker...
Welcome to advanced negotiating techniques 101.
This post is to give one back for all the unsuspecting charterers out there who have been flumoxed by the super clever shipowners. Sorry shipowners - next time I will let you into a few secrets into what motivates exporters and importers.
Understand your clients and make money!
- The Virtual Shipbroker
- 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