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  1. #1
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    Smile Trainer Sales Comissions?

    All done.
    Last edited by gohoos; May. 19, 2010 at 09:34 AM.



  2. #2
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    In my experience it has been between 10% and 15%. Usually 10%, however.



  3. #3
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    10-15%.



  4. #4
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    I've always understood that the industry standard is 10% and that is what I follow with my clients. Sometimes they are able to work it into the sales price, sometimes it is paid by the seller, sometimes out of the buyers pocket. Makes no difference to me, I would consider that part of the negotiation with the purchase. I also know some trainers who advertise horses to me as having commissions built in. As long as they are upfront with the buyer and the seller about what the commissions are so no one is left in the dark, its really up to them. When I sell a horse, I do not pay commission to anyone. If there is another trainer involved and they want a commission, they have to get it from their own customer.
    Teneriffe Enterprises- NW Indiana
    www.saradanielhaynes.com



  5. #5
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    Well...it is whatever you agree to IN WRITING before you start looking.

    Normal (more or less) would be 10 to 15%...and some are 10% over a certain price point, say 10k, and 15% below. Some also go to a flat fee instead, especially on a less expensive horse.

    YOU pay YOUR trainer to find YOU a horse. Seller would pay seller's trainer to sell their horse. You do not pay sellers trainer/agent, that is sellers problem. Take a hike from any deal that asks you to do so, especially on top of paying your own.

    Oh...some represent both sides, buyer and seller, and expect both to pay-that is called dual agency. It is illegal in some states and unethical all the way around.
    When opportunity knocks it's wearing overalls and looks like work.

    The horse world. Two people. Three opinions.



  6. #6
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    Quote Originally Posted by findeight View Post
    YOU pay YOUR trainer to find YOU a horse. Seller would pay seller's trainer to sell their horse. You do not pay sellers trainer/agent, that is sellers problem. Take a hike from any deal that asks you to do so, especially on top of paying your own.
    Question - So the general practice is, the seller of a horse pays usually 10 to 15% to their selling agent who sells the horse? And the buyer of a horse pays usually 10 to 15% to their buying agent who finds the horse? Are there exceptions?



  7. #7
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    There are exceptions to everything. I have agreed to a different arrangement several times, depending on circumstance, and as an amateur when I resold my CANTER horses my trainer always refused the commission that I offered him, but did take it when I sold my amateur hunter. I never asked him why- figured he had his reasons, and gladly paid him for his time even though it was me who made the contact and sold the amateur horse on my own. His time and effort are golden and I respect that even more now that I'm a trainer myself.
    Teneriffe Enterprises- NW Indiana
    www.saradanielhaynes.com



  8. #8
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    Quote Originally Posted by ImTheOwner View Post
    Question - So the general practice is, the seller of a horse pays usually 10 to 15% to their selling agent who sells the horse? And the buyer of a horse pays usually 10 to 15% to their buying agent who finds the horse? Are there exceptions?
    I sold a horse not long that was priced at $30K for $27K and the buyer paid my trainers commission. It was the buyers idea, they wrote up the contract with their lawyer and sent it to my dad after negotiations. Worked out great for us since it's the same amount we would have had if the horse had sold for $30K and we still had to pay commission and the buyer came out $300 ahead. I don't think it's a plan I would have gone for had I been in the buyers shoes but everyone is different. So yes, there are exceptions.



  9. #9
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    So the general practice is, the seller of a horse pays usually 10 to 15% to their selling agent who sells the horse? And the buyer of a horse pays usually 10 to 15% to their buying agent who finds the horse? Are there exceptions?
    That would be the standard arrangement. There are always exceptions. For example, there may be multiple professionals involved in a deal. In that case, expect everyone to put their hands out for a slice of the pie. Or a trainer may agree to take less commission money on an expensive purchase that is at the top of the client's budget, knowing he or she will make plenty from training and showing fees, and again when the horse is sold. I have also heard of trainers taking commissions in installments on purchases.



  10. #10
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    Leases, too, can involve a commission-especially the pricey ones.

    Nothing is really standard except what you agreed to (in writing) when the horse hunt started.

    The absolute most important words you can ever learn to say and never say too much are...

    "HOW MUCH IS THIS GOING TO COST ME".

    Get an answer to that or go someplace you will get one.
    When opportunity knocks it's wearing overalls and looks like work.

    The horse world. Two people. Three opinions.



  11. #11
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    Quote Originally Posted by spoiledsweet View Post
    That would be the standard arrangement. There are always exceptions. For example, there may be multiple professionals involved in a deal. In that case, expect everyone to put their hands out for a slice of the pie. Or a trainer may agree to take less commission money on an expensive purchase that is at the top of the client's budget, knowing he or she will make plenty from training and showing fees, and again when the horse is sold. I have also heard of trainers taking commissions in installments on purchases.
    I know findeight's advice would be first and foremost - agree on it up front in writing! But does anyone have any experience with what "usually" happens when there are more than just the buyer's and the seller's 2 professionals...as you said "everyone puts their hands out for a slice of the pie?" Is the buyer or is the seller going to be responsible for shelling out more than the agreed on 10-15%? Or do the professionals split up that 10-15% among themselves?



  12. #12
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    I guess if the parties know up front how many professionals are getting a cut and what the actual price of the horse is - which many times is not the case - who pays will depend on who really wants to get the deal done. One party might be willing to walk away and take a chance on finding another horse or another buyer. Or the buyer and seller might each agree to take a bit of a hit to complete the transaction. Or the added commissions might already be built in and the buyer and/or the seller will agree to pay more/take less and the pros will really make a killing.

    To be fair, maybe the pros will split the 10-15 percent among themselves, but frankly I wouldn't count on that. Honestly, IME, it will depend on how much they think they can get out of the buyer and seller. I am sure that statement will rile up some of the pros on this board, but in many cases, that's the truth. Depending on the professionals involved, they may very well work together to see how much everyone can make from a deal.



  13. #13
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    In a perfect world, a buyer or seller trainer/agent who got assistance from another Pro might offer a portion of their commission to them and that should not effect what seller pays sellers trainer/agent or buyer pays their trainer/agent.

    Sometimes a third party has the horse on consignment (meaning boarded and marketed for free with costs coming out of the eventual purchase price) and that would be built into the price and not effect what buyer and seller pay in commissions.

    Believe it or not, not every Pro who is only minimumly involved outside the 2 primary agents expects a commission anyway-these people network regularly with each other and the favor will be returned down the road-simply saying "Oh, JJ has a nice mare you might want to look at for your client" does not necessarily generate a commission.

    Even if it does, that would be between them and not tacked on.

    Reality is, though self policing clean up efforts are ongoing, there are alot of shady practices and deadbeats out there.
    When opportunity knocks it's wearing overalls and looks like work.

    The horse world. Two people. Three opinions.



  14. #14
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    Several years ago I backed away from a deal on a lovely hunter that I fell in love with. No one could tell me what the exact price of the horse was and I was not allowed contact with the owner. (Couldn't find out who the owner even was.) It made me frustrated and angry and still cost me money because I had to pay for my trainer's travel expenses and time. I really learned my lesson about what to ask upfront but still if there are several trainers involved you have to be careful because all the info is not always forthcoming. I found the whole horse buying experience mentally exhausting and not fun at all.



  15. #15
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    we have leased and/or purchased 9 horses in the past 11 years as my kids moved through the junior ranks at three different barns. we always agreed to the fee when we started looking, 10 - 15%, purchase and lease. It was always paid by me except one complex deal that involved a trade, my trainer was compensated by the seller. My trainer's have always taken a similar percentage on a sale of my horse. One of them reduced it for a horse that stayed in her barn. One trainer actually had the 15% agreement written into board/training agreement. i'm not sure if it it was always fair but I was never surprised. Oh, I did purchase one horse from the trainer - no fee - wasn't that nice!



  16. #16
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    Always get an agreement in writing, because I have found that a lot of trainers, when they get their hands in the pot, get "amnesia" about what percentage they had previously agreed to when it comes to check writing time.
    FREE TACK/APPAREL ADS: BITS AND BARTER BOARD: http://bitsandbarter.proboards.com/i...ay&thread=5450



  17. #17
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    Quote Originally Posted by ImTheOwner View Post
    I know findeight's advice would be first and foremost - agree on it up front in writing! But does anyone have any experience with what "usually" happens when there are more than just the buyer's and the seller's 2 professionals...as you said "everyone puts their hands out for a slice of the pie?" Is the buyer or is the seller going to be responsible for shelling out more than the agreed on 10-15%? Or do the professionals split up that 10-15% among themselves?
    Unfortunately, what often happens is these situations is that the "extra" commissions are priced into the (inflated) number given to the buyer. The buyer never knows they are paying a lot more than the seller's asking price and the seller frequently doesn't either.

    As a seller, I have been presented with these deals quite a few times; I've passed, because I think it's shady, but it's cost me more than one sale.

    Let's say I have a horse priced at $50k and I agree that I will pay my trainer Mr. Pro 10% on that amount. Mr Middleman sees my horse and offers to pitch him to Mr. Bigbucks - but wants $10k for his trouble. Mr. Pro agrees and Middleman makes the phone call.

    Mr. Middleman and Mr. Bigbucks agree that they will tell Mr. B's client Suzy Amateur that the horse is priced at $60k and worth every penny; Suzy says fine and writes a check for $60k and another $6k check to Mr. Bigbucks as a commission on the buying side. Mr. Middleman gets $10k for his phone call/recommendation, and I get my $50k... out of which I write a $5k check to Mr. Pro on my end.

    Seller nets $45k for a horse that cost the buyer $66k.
    **********
    We move pretty fast for some rabid garden snails.
    -PaulaEdwina



  18. #18
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    Quote Originally Posted by Lucassb View Post
    Unfortunately, what often happens is these situations is that the "extra" commissions are priced into the (inflated) number given to the buyer. The buyer never knows they are paying a lot more than the seller's asking price and the seller frequently doesn't either.

    As a seller, I have been presented with these deals quite a few times; I've passed, because I think it's shady, but it's cost me more than one sale.

    Let's say I have a horse priced at $50k and I agree that I will pay my trainer Mr. Pro 10% on that amount. Mr Middleman sees my horse and offers to pitch him to Mr. Bigbucks - but wants $10k for his trouble. Mr. Pro agrees and Middleman makes the phone call.

    Mr. Middleman and Mr. Bigbucks agree that they will tell Mr. B's client Suzy Amateur that the horse is priced at $60k and worth every penny; Suzy says fine and writes a check for $60k and another $6k check to Mr. Bigbucks as a commission on the buying side. Mr. Middleman gets $10k for his phone call/recommendation, and I get my $50k... out of which I write a $5k check to Mr. Pro on my end.

    Seller nets $45k for a horse that cost the buyer $66k.
    that's exactly the type of situation where I think it is wrong for the Seller and Buyer to not discuss among themselves what the true selling/purchase price of the animal is. The case of a consignment or sales barn would be a different arrangement. I don't know why some people blindly put their faith and trust into people when it comes to money... even the most honest person can get a little greedy. I knew of one trainer who did not do 1 thing to help a client find a horse (the 2 prior horses trainer found were unsound and retired within 6 months of purchase) so when client found a good horse on her own trainer insisted on a 10% "finder's fee" when they moved new horse into the barn (which they paid full board on an empty stall during their search) that was the final straw for the client as they never moved horse into that barn. Total Rip-off



  19. #19
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    Quote Originally Posted by galwaybay View Post
    that's exactly the type of situation where I think it is wrong for the Seller and Buyer to not discuss among themselves what the true selling/purchase price of the animal is. The case of a consignment or sales barn would be a different arrangement. I don't know why some people blindly put their faith and trust into people when it comes to money... even the most honest person can get a little greedy.
    The challenge is that frequently, the buyer doesn't know who the seller is (and vice versa.) The checks are written to agents who then in turn disperse the funds.

    Sellers can help limit that kind of behavior - but make no mistake, they limit their market by doing so, particularly if they want to sell to the upper end of the market. Ask me how I know this.

    As a seller, I require a sales contract which includes a provision that I get a check from the buyer directly and states that both parties will handle their own commissions. If my pro needs/wants/uses another pro's services to help get the deal done... he pays for that assistance out of his commission. (He does not get enough from me to pay anyone else 10%... unless he wants to work for free.) I have been approached any number of times with the message that my horse can get sold to so and so's client, but we have to price in an extra $10k/$20k/pick a number in order to "take care" of all the intermediaries. And people wonder why a nice young horse with a bit of a record at the big A shows ends up being six figures...
    **********
    We move pretty fast for some rabid garden snails.
    -PaulaEdwina



  20. #20
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    Quote Originally Posted by Lucassb View Post
    Unfortunately, what often happens is these situations is that the "extra" commissions are priced into the (inflated) number given to the buyer. The buyer never knows they are paying a lot more than the seller's asking price and the seller frequently doesn't either.

    As a seller, I have been presented with these deals quite a few times; I've passed, because I think it's shady, but it's cost me more than one sale.

    Let's say I have a horse priced at $50k and I agree that I will pay my trainer Mr. Pro 10% on that amount. Mr Middleman sees my horse and offers to pitch him to Mr. Bigbucks - but wants $10k for his trouble. Mr. Pro agrees and Middleman makes the phone call.

    Mr. Middleman and Mr. Bigbucks agree that they will tell Mr. B's client Suzy Amateur that the horse is priced at $60k and worth every penny; Suzy says fine and writes a check for $60k and another $6k check to Mr. Bigbucks as a commission on the buying side. Mr. Middleman gets $10k for his phone call/recommendation, and I get my $50k... out of which I write a $5k check to Mr. Pro on my end.

    Seller nets $45k for a horse that cost the buyer $66k.
    I have nothing against a person who spends their time to help me find a horse getting something for their efforts, but the above scenario seems all too tempting. If I tell my trainer I want xyz and can spend, say, a maximum of $20k, I'd be really surprised if he/she found me a $10k horse! Any horse he/she shows me is likely to be...surprise! about $20k, no matter what its actual original price.

    It's sort of like real estate - the broker might help you negotiate a deal and smooth the sale, but even if they are working "for you" their main goal is to sell you a house as quickly as possible for as much as you will part with... that's how they make a living.



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