A Broker Should Not Just Be A Person In The Middle
by Jay Mesinger

Often people will ask me what I do for a living. My reply is that I buy and sell aircraft. Usually they then want to know for what company. When I tell them I sell all types of business jets and work for myself, they say, "Oh, you’re a broker, the guy in the middle, the middleman."

This is a serious misconception of the role of the aircraft sales professional that results from people in our industry floating around the middle, working to attach to one side or the other. Usually, the middleman type brokers are attached by default to the paying side. I say default because they may have started as a representative of one side but find that they are being compensated by the other side.

Pretty confusing. Yet, you’d be surprised by the number of times a buyer will call to engage my services, and then tell me to get my commission from the seller. In these cases I think the most confused participants are the buyers. They are setting themselves up for an unrepresented process.

You see, the broker should not be the person in the middle. They should be very clearly aligned emotionally, contractually and financially to one side or the other. It only gets murky when all three of these commitments are not properly aligned. Since the roles are often murky, the reputation of the institution of brokering can also be murky.

Believe me, clearing up this murk is our job. As an institution we must be the leaders in establishing clarity for our role in the process of buying and selling. What follows are some examples of this lack of clarity that create uneasy feelings for aircraft buyers and sellers.

A client whose aircraft I recently sold called to let me know that several months after the sale he called the buyers and asked them how they felt the process went. The feedback was very interesting…

This transaction was, like many, a process with a few twists. After having this particular plane on the market for five months, I received two offers on the same day. This often makes for a difficult situation, setting up a horse race that could cause the loss of both deals. Anyway, by the end of the day, one of the buyers had clearly jumped out ahead. I called the other buyer out of courtesy, to give them the chance to meet the higher offer since they had given me the first offer that day. They declined and I went back and took the second and higher offer.

Three days later, it became clear that the higher offer was made by someone who was not really qualified to perform as quickly as they had promised. My client and I had been talking nonstop during the offer process and the days that followed. We collaborated about every decision. When it was clear that the second group was not going to perform, my client and I decided to call the first group back and take their lower offer if it was still available. I called, it was, and we closed shortly thereafter.

When my client called the buyer months later to ask the question about their perspective of the transaction, the only comment they had was how they felt his broker (me) had made up the whole "other guy" story to get them to make a higher offer. That was not at all the truth about the process that I described.

They had a perception about brokers not communicating with the client but acting in a rogue way. They, of course, were not using a broker and they felt even more justified in that decision to not use a broker when they assumed that I had been playing games.

Your broker must work hard to establish lines of communication with your entire team, including legal, financial and tax professionals. In fact, more often than not, our company is the glue for the team. We, as a group of sales professionals, have to be careful to understand the misconceptions of many. We cannot just be guys in the middle. We must be viewed as team shapers.

Another very difficult problem to overcome is the idea of the broker making referrals to other services during a sales or acquisition process. Our clients may wonder if we are accepting finder’s fees or referral fees.

Many of you reading this have been in the business for years and it is only natural that you would have developed a huge bag of wonderful service providers and vendors. We should be the first person our client should ask for that referral. But you would be surprised how often a new client will ask me, after I start thinking out loud for a referral for one thing or another, "Do you get a fee for that?" The answer of course is no way! How could I possibly stay emotionally, contractually and financially responsible to my client if that were the case? I, like most of my other sales professionals, are compensated one way, one time, upon completion of the transaction.

I am sure you each will have your own stories to relate about the misconceptions that have been articulated about your role as a broker. I’m also sure that having heard these misconceptions you have in your own way made efforts to clarify our position, not just for the person who mentioned the misconception but also in your every action, so as to create clarity for our entire industry.

To all of you who work daily to improve the reputation of aircraft brokers, I want to thank you and encourage you to keep up with this important work.