The subject of the day is SUBJECTS

As we know - shipping has lots of jargon.

Take these two sentences

"Thanks main terms recap, we are now fixed subject charts reconfirmation 24 hours. Please send executed proforma cp for review"

Now - to me this makes perfect sense because I am fluent in 'Shipping'. But the truth is to most people - even those with shipping knowledge like a seafarer, naval officer, maritime business student etc the above means gobbldyigook.

And the thing is that a 'shipbroker dictionary' wont really help either because to understand the words you need 'context'. Interestingly in that sentence not one word is wasted which is a throw back to the time when writing telex messages was super expensive. Virtually every word has huge legal significance.

Anyway - I just thought I would share a discussion I am having with my current students.

For me - teaching the VS Certificate has allowed me to gain amazing insight as to what people do and do not know. We can THINK we know what people NEED to learn but its not until you engage students in meaningful discourse that you have a more than a few revelations. All this amazing and evolving feedback that I receive helps me get better at teaching which in turn will help future students of the VS cert. Thats gotta be good for the industry!

Here is the sentence again

"Thanks main terms recap, we are now fixed subject charts reconfirmation 24 hours. Please send executed proforma cp for review"


Three cheers for anyone wanting to explain to readers the significance of the two sentences.

Go on give it a go...

VS

Shipping Pedigree

Shipping has an amazing history. Some of Europes great families have been involved in shipping for many generations.

I found out recently that one of my direct ancestors was a ships captain in the Dutch East India Company way back in the 1600's. Found through ancestry.com and verified through church records.

Exciting discovery

VS (15th generation shipping folk)

Which type of shipbroker is best?

This post is in response to a fairly regular question asked by readers of the blog.

It goes something like this - "as an aspiring shipbroker I would like your advice as to which area of shipbroking has the best growth prospects. What type of shipbroker offers the best chance to make millions of dollars etc etc'

This is an understandable question. There are many types of shipbrokers. Check the Clarksons, SSY, Platou, Maersk Websites and you will see many different departments. Dry Cargo, Tankers, Dirty, Clean, Sale and Purchase, Offshore, Short Sea, Derivatives - the list goes on.

But here is the gig. I have said this before - everyday - brokers of all descriptions are making millions of dollars in anyone of the above mentioned sub markets. The average salaries in all these areas are remarkably similar too.

Cant decide?

And it is my sincere belief that all these markets will continue to offer lucrative opportunities for many years to come.

The other thing is this - I could say to you that imo you should move towards for example Dirty Tankers as this is a growing market. The problem is many others in the Industry would suggest the opposite. The commodity, economic, technological and political markets are changing so quickly that goalposts are moving all the time.

Other thing to consider is this. Which department is best sometimes also depends on which company you actually work for. You may be in what you consider a 'growth area' but if your colleagues and current clients are small scale - then you may get stuck in a dead end job. Join a successful firm in a niche area and you may set yourself up for a successful and interesting career.

So bottom line is this - if you are looking for the holy grail - im sorry there just aint one. There is no inside secret or inside story. All segments are booming (due to sustained commodity booms) and will do so for sometime to come.

If you are lucky enuf to actually have a choice as to where you get trained (most trainees get told where they will go) then choose the area that interests you the most - simple.

Yours
The Virtual Shipbroker (all Rounder)

Shipbroker commissions - A question

And a good one too

On the controversial topic of shipbroker commissions

Qte

Anonymous has left a new comment on your post "Shipbroker commissions.":

Hello VS! I consider myself an experienced tanker broker (15 yrs experience). We run a small brokers shop and conclude business with various charterers and many ship owners mainly in Europe. We normally charge 2,50% brok. commission on vessels less than 20.000 dwt (a usual practice among european brokers) and 1,25% on vessels above 20k size. Recently we run into argument with one of our clients - a ship owner, whose new management have established for themselves that broker can be entitled to max 1,25% brokerage regardless whatever is the size of the vessel and whatever is the business.

I'm wondering what is your opinion on this issue?


Thank you!


Unqte

Many thanks for the question which is indeed a good one. i do have some views on this topic but would like to open this one up to the readers to see what they think.

Anyone care to have 'a view' on this 'interesting" topic. In my book I made the point that many brokers 'dont have much to say" - so here is your chance. Having an opinion is good!

An open question from a reader

quote

Anonymous said...

Hello VS-

I had a phone discussion with a shipbroker today, and he was telling me about the company and what not. He informed me they have an operations division where they take a "position". What does they exactly mean in the shipping world? I know in Wall Street for instance, that means a company puts of their own money on stock investment.

unquote

Anyone answer what it means to 'take a position' in shipping...?

Join in...

anyone know this site?

http://www.newssummary.info/

Many people visit my site from this site but you need a log in

Bit of a mystery - if anyone can shed some light on this site please let me know

Rgds
VS

Key to Shipbroking Success

CREDIBILITY...

One reader of the blog recently told me (in a private email) that he didnt realise that the market will punish you badly for incompetence. It is true. Many clients, be they shipowners or charterers will give a broker one chance to prove themselves.

So when courting a new client understand that those first few weeks, months - those first few deals, will determine your longevity with that same client. Do alot right and they will cut you some slack - do many things wrong (especially at the start of the relationship) then dont expect a second date!

Shipping is cut throat in that respect. All the more reason to think about how, as a shipbroker, you can continue to build credibility. A broker needs to think about his/her own personal credibilty but also the credibility of the firm they represent.

From a marketing perspective this is known as BRANDING. Everyday brokers need to think about building their own personal BRAND aswell as the firms they represent.

To be conscious of branding is to be conscious of every single element of the communication process - not just very visible things like websites, business names, logos etc.

Every phone conversation, email, sms, long lunch and board meeting is an opportunity to build and sell your brand. Are you making the most of these opportunities?

VS

101 followers - Drinks on me!

Where is everyone?

So I havent shaved in a while!

Followers

Look - if i can get to 100 followers by xmas I will buy all my followers a round of beer! 

Do it!

Time charter concept - where do ships deliver?

In the world of time charter shipping a charterer and a shipowner need to come to a mutual agreement with regards to where (position) the ship will be delivered.

There are two main spots a ship can be delivered

1. DOP (at the last port where the ship comes open under previous employment)
or
2. APS (at the port of load)

Pilot boat next to Mothership

Lets look at an example. A ship is discharging coal in Japan and will finish in 10 days time. Her owners are now negotiating her next employment which is another stem of coal loading from Indonesia (they will need to ballast there empty).

The parties are in a time charter negotiation and the charterer wants to take the ship APS Indonesia (doesnt want to pay for ballast leg) but the shipowner wants the charterer to take the ship DOP Japan (when she finishes discharging in Japan). So this discussion is about who pays for the ballast leg. That should give you an idea regarding the concepts.

Ok here is a question for all reader of the blog. Apart from DOP or APS delivery can you name other types of Time charter delivery (other than these two)? There are a few unusual ones out there.

Come on and join in - let me know your ideas (even if they are a guess)
VS

Sorry

Quick note - every few weeks I receive a request along the following lines.

Dear VS - Love your blog and books keep up the great work.

Print your books!

About 6 months ago I bought two of your books (great reads) and unfortunately my computer has gone and crashed and taken all the files with it. I did not print out hard copies. Is their any chance that from the goodness of your heart you can send me the books again. Your faithful reader Joe Blog.

Sorry guys - the onus is on you all to print the books when you buy them. I wish I could go into a bookshop everytime i've misplaced a hardcover - but I can't.

Plus I sell the books via a thrid party provider and it costs me time and money everytime I want to send a duplicate. Trust you all understand.

VS

And another

From a reader of the blog and books

qte

I finally made it to Shipbroker!


Since sending out dozens of e-mails with my cover letter and CV attached, I got an interview with a firm near ......... last week and today have just got their call that I am accepted and to start as of Nov 15 with internship of several month period first.

All my thanks should go to your e-books and blog which I've found renewed and good.

Please keep in touch for further mutual help.
 
unqte
 
Plenty of opportunities in this market.
 
Cheers
VS

Rated tonnage

One of my current students has asked the question...what is "rated tonnage"?

Fairly simple really - Rated tonnage is any market ship that is being circulated with the owners rate idea attached.

Everyday thousands of ships are circulated through the markets giving the salient points.

Name
Size
Brief description
Where she is open

Very few however come 'Rated'.

Here is an example of a ship being circulated (and rated)

Quote

MV Delpiero 23,456 dwt, built 2001, pan flag, 5/5, 4 x 30 tn cranes - open Gibraltar 5-10 December

Wanting trips to the far east and rating same at USD 16,400 per day

Unqte

Above is an example of a ship that carries a rate from the shipowner. The rate is a generic rate and makes the basis for initial discussions should a charterer be interested in her.

Another instance where we use the words 'rated tonnage' is when a charterer calls for 'rated tonnage only'.
This means that a charterer with an open position does not want brokers and shipowners to send him/her ships without rates attached. They are saying "if you send me a ships description with no rate idea I will ignore the message".

Smart idea - it makes the broker work hard to get the shipowners rate ideas and it also makes the shipowner declare his hand early. This works in a soft market. In strong markets its not so easy.

Follow on question for anyone out there

Why aren't all ships rated? Why is it that shipowners refuse to put rates on ships being circulated in the market?

Be good to see some replies - join in...

VS

(note: when we talk of rated tonnage - in general we are talking about time charter not voyage charter)

controversial posts

One of my more controversial posts was shipowner secrets. I can understand how some may see this type of 'creative' endeavor as somewhat unsavory especially in the gentlemans world of international shipping. Even speaking of such things is enough to get me crossed of any number of peoples christmas guest lists (and I have been struck of a few).

I think people are too quick to judge because of the context.

Lets look at a similar situation in a different industry and then ask yourself how you feel.

Scenario - You are Wayne Rooney's (Manchester United superstar) manager and Wayne has told you he wants to leave. Your job is to find him a great new football club and to get him as much money as possible.

That's your job!

Would you

1. Tell prospective football clubs 'yes interest in Wayne is very high' - even if you haven't seen any interest yet? (probably...?)

2. Leek to the media that Barcelona or Real Madrid have shown interest - even if they haven't....(yes)

3. Tell Barcelona in private discussions (weeks later) that Wayne has a re-occurring groin injury and that he can only play with pain killers? (I doubt it)

4.  Tell Wayne that there are lots of suitors and that you (his manager) are just sorting through offers (even if there are no such offer yet on the table - what the &*^% is he paying you for? - we know about the ego's of football players)...

It goes on......like shipping back and forward. But in the Rooney Context it sounds like a bit of fun. When we discuss it in shipping - its much more serious (or is it).

++

And then we have the shipowner (or in this case Barcelona)

If you are Barcelona's recruiter are you going to tell Rooney's manager that the big boss says "get him at all costs"? Not likely. You will play the negotiation game for a month or so and try and see what level the market is. Why offer him 100 million when he will walk for 50 million.

Will you tell Waynes' manager that the football club made a record profit last year and has 100 million in the bank? Or will you say that merchandising has been down and that cash is tight? All the while trying to figure out if the rumour is true that Rooney only wants to play for Barcelona...

That is what a shipowner does too...plays the game. (not just the brokers/player managers who can sometime be easy targets for those claiming manipulation)

Sure high stakes negotiation can be tedious, but it can sometimes be fun too.

You need to have a sense of perspective (and humour) that is for sure. Not for everyone.
Ciao

VS