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Need advice: considering starting a matching service

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  • Need advice: considering starting a matching service

    Hi All
    This has been something that has been in the back of my mind for some time and I'm trying to brainstorm how to do it the right way. Hopefully I can put my thoughts into some coherence on here and get some insight about how to move forward with this.

    I work in an equine vet clinic and am often approached by people looking for horses or trying to sell horses and I have matched up lots. Now that I am starting to put in a bit more effort I am thinking that the time I am putting into this should be worth being compensated for, especially when a seller is making $15k from a buyer that I sent to them.

    While I know that people can search the internet themselves and do the leg work without me, there are still people who need help from someone with connections. Especially if I am going to take a look at the horse first, then based on my recommendations have the buyer come out at another time. I feel that the time I am putting into this really deserves more than just a "thank you" as I am spending money on gas and phone service out of my own pocket to help people.

    While I don't necessarily want to become a bloodstock agent at this point but that may well end up where I am headed since I do a lot of work with OTTBs, too.

    Does anyone else on here do this and if so, how do you charge for it? One woman I know only charges $100 per horse but I was thinking 10% from both the buyer and the seller depending on who I am helping.

    This idea is still just an idea that I am formulating to see how I can make something I am already doing for free start paying itself off. I like helping people but since I'm doing it so much now and more indepth then I think I should put 2 and 2 together to make a profit from it.

    What are your thoughts fellow COTHers?

  • #2
    Seems like a good idea, but I wouldn't go with 10% from both the buyer and the seller. I think the buyer perhaps a flat fee would be better, and then maybe 5-10% from the seller.

    I have to think of this from a buyer/seller point of view, and see what i would expect though.

    Comment


    • #3
      Precisely what services are you planning to provide for your 20% total cost? From your post, it sounds like all you're doing is connecting buyer and seller, and maybe taking a trip to the farm to see the horse, get some pictures ...? Maybe that'd work if you're dealing with horses in the low to middle four figures, but as a buyer, I cannot imagine paying $1k to someone who told me about a $10k horse and gave me a few pictures/video, and I ended up buying that horse, presumably after I've paid 10%-20% commission to my trainer as well.

      I might be inclined to pay a set finder's fee, but I'm not paying a percentage of the sale to anyone but my trainer, who will be doing a lot more legwork in terms of evaluation than it sounds like you'd be doing. Unless you're planning to evaluate the horse in hand/under saddle, watch/video the client riding it, give client lesson on it/pointers while client rides, talk with client later about both rides, arrange any trial/off-site rides/etc., attend the vetting/discuss the PPE results with client in terms of what client's goals/expectations/budget are, handle any negotiations between client and seller, etc. IME that's what a trainer does (or should do, at any rate) to earn her 10-20% commission. If the trainer does her job, that commission is *well* earned. If you did even some of that, I think you could get 10%, at least from the buyer.

      You might do better if you offered a menu of services, from finder's fee (you know X is selling this particular horse and Y is looking for this particular horse, so you give out contact info/make initial contact) to % of purchase price for more detailed evaluation. Someone whose BNT isn't available to come see horse in person might be willing to pay a set fee for you to come evaluate horse/video her riding it/etc.
      Full-time bargain hunter.

      Comment


      • #4
        At least in Kentucky, it is illegal to charge both seller and buyer. Not 100% sure if it's still illegal if you notify them (like dual agency with a real estate agent.)

        Google the lawsuit by Jess Jackson.

        And yes, if all you are doing is "matching" 20% or even 10% is outrageous. If you want to be a buyer's agent, you need to do all the work, find, evaluate, ride the horse and evaluate, etc. You also need a good deal of knowledge about horse confirmation, etc.

        Comment


        • #5
          I think your 10% rate is extremely high. I think you will find that no matter how much you charge, though, a lot of people will stop using you once you start charging. The market you describe--OTTBs--is saturated right now and most buyers in that market are savvy penny pinchers.

          As a seller, I would never agree to pay a "matching fee" to someone. If you had a buyer with you and they wanted to pay you something I wouldn't care, but I wouldn't foot your bill. And IME, the owners of OTTBs are typically very reluctant to sink any more cash into horses that are already a losing proposition to them.

          Typically the only people who are able to charge worthwhile commissions for riding horses are trainers with a name and reputation who invest significant legwork looking for horses for clients that have been training with them for a period of time. Do you have the credentials and the insurance to be acting as a "trainer?"

          IMO, the value of the simple "matching" service you describe is probably in the neighborhood of $50-100 per horse, not 10% of a 15K horse.

          Oh, and just as an aside, I've got to take issue with the comment, "When the seller is MAKING $15K..." Oh, so someone gave them the horse, and all the board, care, and training they've put into it was free...?? Just a little FYI, there's not usually much profit in a 15K horse.

          Comment


          • #6
            Originally posted by onelove View Post
            especially when a seller is making $15k from a buyer that I sent to them.
            What are your thoughts fellow COTHers?
            Have you ever sold a horse? Someone selling a $15k horse, if they are lucky, is making a couple of grand.

            People probably ask you because you are there and you may be in the know. I ask my farrier or my vet if I am looking for something. If one of them turned round and said to me they were going to charge, I would politely decline and carry on my own search.
            As a seller, I wouldn't dream of paying a commission to someone else. Another thing to consider is what sort of liability you run if you recommend a horse as suitable which ends up being blatantly unsuitable. I would also suspect that the vets that you work for may not like it as the buyer may take some implication of soundness by the fact that you work at an equine clinic and recommended a horse, therefore may assume you think it is sound.

            Comment


            • #7
              My trainer charges a flat fee for her time ($45/hour). That way, her clients can be assured she is looking for the best horse possible for them, regardless of price. If you charge a percentage of the price (though most do this) obviously you have a strong incentive to find a more expensive horse for the client.

              The above is one reason why people are fiercely loyal to this trainer. (And yes, she finds $75,000 horses for some of her clients, and $3,000 horses for others. Or free.)
              https://www.facebook.com/SugarMapleFarm
              Follow us on Instagram: https://www.instagram.com/peonyvodka/
              www.PeonyVodka.com

              Comment


              • #8
                This is a slippery slope, beware.

                Yes, your time and effort is worth something. Trying to figure out how to serve your customers at a reasonable rate is another. You don't want people avoiding telling you about a horse or prospective purchase because they don't want to pay your fee.

                Maybe for sellers you could offer marketing services? Charge for photos, fliers, etc.?

                And you certainly don't want to offend your current employer, which may happen if you are not careful.

                Comment


                • #9
                  Outfoxem has a good point...there definitely could be some conflicts of interest related to your current job if you start a business in brokering horse sales. For example, if you know a horse's medical history or what the xrays looked like, and you disclosed that to a prospective buyer without permission--or even if people just THOUGHT that you might--that would be a huge issue for your employer.

                  And if you are talking to people about horses and evaluating horses in the course of your daily job, I could also see your employer taking offense at that, #1 because you are supposed to be doing a job for THEM, and #2 because conceivably (people are ridiculous these days) they could be assuming some extra liability, and #3 if you made a mistake or a bad match or even just didn't favor someone's horse it could affect your employer's relationship with their clients or their reputation.

                  Comment

                  • Original Poster

                    #10
                    Thanks everyone. This insight helps because as I said, it's still just an idea and I'm not 100% sure of the details of how I would do it.

                    As far as work goes, I've always maintained that clients and owners should call me after work and most of the vets I have worked for, have referred their owners to me in helping find homes for their animals, whether it was horses dogs or whatever, whether they were for sale or free. And actually it was my last vet I worked for who suggested I start charging people something but I never really started thinking about it until now.

                    I have some more thinking to do on this and I'll post more later. I don't know if I would charge 10%- that was just a round figure I out there as I was typing the original thread. Let me put my thinking cap on and ponder this some more.

                    Thanks for the help

                    Comment

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