Shane Bellone Thinks It's Ok To Bypass Broker.

[talhahassan]

Hi

I sent two LLL.com domains which I was brokering to Shane Bellone in response to his thread in Domains Wanted.

He replied to me first about dropping the price.

I asked how much is his client's highest offer . To which he said how many months finance would be agreeable.

I told him owners won't agree to financing options.

He then asked me why I messaged him in the first place as his requirement was related to financing the domain and he will contact the owners now to see if they will agree.

I apologized to him for missing the financing part and asked when did it become a good business practice to bypass brokers and contact the owners directly.

His reply was " My business is to get the best price for myself and my clients. Bypassing a broker who may or may not have an exclusive contract makes sense. Saves them a commission which therefore saves me or my client money."

I am attaching the link to the screenshot as well.

imgur. com/a/l4VDz
I think it's totally unethical to bypass a broker . What are your thoughts on this?

 

[Joe N]

Please. I brought your statement to the table. When you objected at the obvious meaning of your statement, I asked you straight up what you would do.

You refused to answer this and changed the focus elsewhere and upped your phrasing using a higher lix number. Now probably you are used to be able to distract people with tricks like that, but I will hold you to your words. As poor as they are.

The fact is you gave me no answer to the question I posed. You gave me a question in return. Thats all the answer I need from you.

No one owes you an answer. Get over yourself.

 

[S-B]

The fact is you gave me no answer to the question I posed.

I would not encourage someone to break a contract but I would buy a domain from someone who did break a contract.

I believe I did answer your question.

If you continue beating a dead horse you will just look stupid and get tired.

 

[promo]

I will stop beating you then. Could you then please go back to being retired or whats this weeks story?

 

[DU]

I am not sure why it's so difficult to understand the situation?

Broker: People who are Broke
Exclusive: The owner grants permission to ONE person to sell
Non-Exclusive: Anyone can buy from any broker or directly from the owner.

I like that brokers have no money

The reason that it's so difficult to understand is that people get half explanations. Your explanation is partially correct and absent of critical components that imply an incorrect understanding.

Exclusive Broker Right to Represent Agreement-
Anyone can buy from the owner direct or even via another contacting broker (buyer-side). The exclusive broker (seller side) will get commission regardless. The owner can only have one broker representing the sale.

There are some tricks - if there is a buyer and seller broker then the commission could be split (i.e. owner will give me 20% I'll give you 10% to provide the buyer).

Again it should be noted (and Shane is correct) that the interests of the client are all that matter. Buyers agent to the buyer, seller's agent to the seller. A broker's goal is to end up being both the buyer and seller as that maximises money in their pocket. There is no room for shady activities - "I'll reduce the price the owner wants to his floor price but you sell at the buyers full price and we'll split the difference".

This exclusivity listing is often a challenge in the domain world because owners will change exclusive brokers without the appropriate shutdown - that happened with Whiskey.com as I mentioned a number of times when that was at Flippa that was simultaneously available at Sedo.

Non-Exclusive Broker Right to Represent Agreement -
Anyone can buy from the owner or via another broker or in any way they want. The Non-exclusive broker will still get commission if they initiated the sale. An owner could have an army of brokers if they wanted but must pay commission on the party providing the lead. Only direct owner communication by buyer or buyers agent (non-contacted) would avoid compensation.

The best response in this thread is @equity78 which is very clear. The broker should supply their client with a list of people that have shown real interest that they contacted if they are non-exclusive to ensure they get compensated. A owner could not pay but that's an agreement violation.

Where @Shane Bellone is wrong is here in this thread:

Bypassing a broker who may or may not have an exclusive contract makes sense. Saves them a commission which therefore saves me or my client money

It saves commission if there is NO agreement but in that case there is no commission to pay or save anyway. Whether the arrangement is exclusive or non-exclusive the commission is not and should not be saved. There is a right to represent without compensation; however, that's an unlikely scenario in this case.

The onus is still on the owner/seller to fulfill their obligations but the contacting party should not actively and knowingly encourage the counter-party to renege on their agreement. In the real world that ends careers. In the domain world it gets you some fans and some enemies that have almost no real impact.

Also - as many have pointed out... many brokers are "brokers" and many "clients" are made up because people want to pretend that they have clients when they're just trying to get names on the cheap.

Sorry I'm late to the party.

*Of course the above depends on the agreements signed and there's nothing indicating they need to be solid or follow a rule. This is a highly unregulated industry... and thus full of shady ethics.

 

[HUKU]

It saves commission if there is NO agreement

You mean between broker and seller? I think that's correct word to use because the obvious misconception being pushed around here is that the broker needs a contract (exclusive or otherwise). Though a contract is preferable, that's absolutely not the case because only an agreement (exclusive or otherwise) is needed and the validity of which is determined simply by mutual acceptance. The industry respects informal arrangements all the time so its nothing unusual.

contacting party should not actively and knowingly encourage the counter-party to renege

That's true. If its not any breach of contract (since he doesn't have any such obligation with the broker or seller) or even of ethics, then it is at the very least a double standard especially if the contacting party is himself a broker relying upon sale commission for his trade.

Of course the above depends on the agreements

Very much and as per the old English expression: "the devil is in the details."
What you said about the broker sharing commission is a good idea, it really should be used more to bring buyer/seller together on price and solve the problem of pitting one broker against another.

 

[Kate]

I like that brokers have no money

A domainer (not me) once wisely said:
A broker is broker than you are.

 

[Wannabean]

I sense a missed opportunity for weighing in on something that is:

1) None of my business.
2) I know nothing about

I've let myself down.