Speaker 1: 0:00

Going over a couple of different ways to get paid. Obviously, the first way that we get paid is by being a broker, so that's negotiating commission on the buy side or on the sell side. Everybody understands how to get paid as a broker, right, it can be commission, it can be flat rate, it could be a graduated rate if you want. So the idea behind the graduated rate is sometimes people say if you sell it for X, I'll give you this much. If you sell it for X, I'll give you that much. The other one I want to talk about that you guys can maybe start using, or maybe use as your own, is this idea of an affiliate or a finder's fee. In the industry sometimes they're known as bird dogs and these are individuals that you might come across, or you yourself want to be in this position whereby you go and find a buyer or a seller for somebody and you get paid a commission from the broker. Hey, edward, if you want to bring me a CJ that I can list, I'll throw you 500 bucks to get it signed and then on the back end I'll pay you. Whatever it is, you know, whatever he's going to do, I'll pay another 500 on the back end, or I'll pay you a thousand dollars when we sell it, or if it's a pilot, you know, hey, you bring me a listing and when we sell it, I'll cut you in for 10% of the commission or half the commission, whatever it is. So you can be a bird dog, or you can utilize a bird dog and cut a piece of your commission to them to help you get more business. Any questions there? So then, the final piece that we want to talk about is working with inventory guys slash wholesalers, slash investors.

Speaker 1: 1:45

So now here's how this works. You're going through your market and you find an aircraft. Here's my beautiful aircraft. Okay, you find an aircraft. Mr Seller is willing to sell. So this is the seller. He's willing to sell for $1 million. Okay, mr Investor or wholesaler is willing to pay $1,000,000.

Speaker 1: 2:05

Down here you've got a guy we call him the End User is looking for this exact plane and he's willing to pay $1.5 million. So what do you do? You found the plane. He's willing to sell for a million. Because you're a professional, you have access to guys that are inventory guys, wholesalers and investors. They're willing to pay a million dollars for this jet. You've got an end user that's willing to pay $1.5 million for this jet. So you got a couple of options. Option one would be hey, mr Seller, I've got a guy to buy your aircraft at a million dollars. Will you pay me a commission? Yes, great, okay. So you make a commission here right Now. This guy might go off and find another seller. You never hear from him again.

Speaker 1: 2:47

That happens, however, if you're like well, hey, I remember Bob over here, he's looking for this exact same aircraft. Hey, bob, we've got it for sale over here for $1.5 million. Let's just say for the sake of argument. He's like oh cool, I'll buy it $1.5 million, no problem. So now you can make a commission here selling the plane for $1.5 million from the wholesaler to the end user. How much commission do you make? That depends on your relationship with the wholesaler. Could be a 6% for the sale. There's a $500,000 split here, though I've worked with wholesalers where they give me a commission. That's better than my 6%. So it kind of depends on how you would do that.

Speaker 1: 3:31

Now this happens. There's nothing illegal, there's nothing shady here going on At $1.5 million. You know. The question is why would somebody pay $1.5 million for a million dollar jet? Well, maybe the jet's actually worth $2 million and he's getting a deal, or maybe it's not worth 1.5 million dollars. Maybe he's like, well, I'll only pay 1.2.

Speaker 1: 3:54

Now you got to go back to the investor and negotiate that deal and negotiate that commission, this sale between the investor and the end user. It can happen one of two ways the investor can buy from the seller, fix it up, add value and then flip it to the end user, or it can happen at the same time. This is called a simultaneous closing. It's tough to do because, basically, you need this contract between wholesaler and seller to say X, and you need the contract between the end user and the investor to say the same exact thing, just changing the prices. If you do that, you can close all at the same time. Now what's the inherent problem when you're doing this simultaneously? If you make a mistake, mr End User sees that Mr Wholesaler is buying it for a million dollars. Again, there's nothing illegal about that, but it's probably going to not make his day, and so what I recommend in this situation is that we exercise transparency.

Speaker 1: 5:05

Hey Bob, listen, I know you've been looking for this jet. I found it for you. I know it's exactly what you're looking for. I know you already told me you're willing to pay 1.5. The reason this jet is available is because one of my partners I have a wholesaler that has it under contract and he's willing to sell it for a profit. Well, how much of a profit. He's buying it for a million dollars. What I'm not paying half a million dollars for it. Bob, I'm with you 100%. We can go find another plane, but you know, we've been looking for a while and it might take a little longer. Or I can go back to this guy. You tell me what would you pay for this plane? Well, I would pay 1.2.

Speaker 1: 5:44

So we go back to the wholesaler and say, hey, dude, like okay, we can flip this simultaneously for 1.2. Well, I want to make $200,000 in this because, again, the wholesalers don't do this out of the kindness of their hearts. They need to make money. So they might say I don't want to do it for 1.2., I'll do it for 1.3, so that you get a commission too. And then you negotiate the deal and it all's well that ends well. The reason I'm bringing this up to you guys is one, just so you can think of different ways to make money, utilizing bird dogs. And two, working with wholesalers because we have these guys.

Speaker 1: 6:18

So when you're going through your markets, if you find someone that's going to sell a jet cheap, let's talk to the wholesaler see if there's a play there. Alex brought up a point earlier. What happens if you're going through a market and you find a jet, you know it's worth 1.5, and the seller tells you I'll take 1 million. What do you do? Do you tell them? Do you have to tell them? I'm going to tell you, yes, because we're professionals and we value honesty and transparency. Okay, some brokers won't. Some brokers will just be like oh, you want to sell it for a million dollars. Okay, I mean, I'll see if I can find somebody. You know it's worth 1.5 in your head. I'll see if I can find somebody. It's probably really only worth 900 grand, bob. But you know, if I bring you somebody in that nine hundred to a million dollar range, like you know, maybe we can make something happen.

Speaker 1: 7:09

Meanwhile, you know, you got a guy you call your buddy and he's like I've got a deal, we're going to buy it for a million dollars and we're going to put it on the market. Because we're wholesalers for inventory guys, we're going to add it to our inventory. We're going to put half a million dollars on top of this and we're going to sell. It's going to be a steal. Those are like real conversations that happen and all of a sudden, bob sells it for a million when he could have sold it for 1.5.

Speaker 1: 7:26

And the broker's not being honest. What would I do, or what I would like to see us do in that conversation, is basically say to the seller hey, bob, listen, I know you'll take a million dollars for it. That's a great price point. I think it's worth more. But of course, if I put it on the market and it's gonna be more, it's gonna take longer for us to sell it. You know you'll have my commission. It maybe you only walk away with with 1.3.

Speaker 1: 7:48

Do you want to put it on the market and try to get more money or do you want to sell it now? No, tom, I need to sell it now. I've got a divorce going on. I'm not using the plane. I've got a big bill like. I just need to sell it for a million dollars right now. Great, okay, everyone's on the same page. You told him that it's probably worth more money. He's okay with that. He's willing to let you sell. Great. Now you can sell it to a wholesaler for a million. Now, based on your relationship with the wholesaler, you might make a commission for that first sale of a million. Based on your relationship with the wholesaler, when he goes to flip it can you make money. And that's a conversation with the wholesaler. So I just wanted to outline these two things again.

Speaker 1: 8:26

Working with affiliates, working with bird dogs, slash, what do we also call them Finders? Finders, yeah, like finders, feed guys. That's one way you can do business. And that's the same thing. When I'm calling through, if I'm talking to a pilot and the pilot's like, yeah, they might be interested in selling, you know, I will say to the pilot hey, look, I really think we can get this done. Do you need to get paid in the deal? And I'll ask the pilot like, is he looking for something? Because I've had pilots at the end of a deal ask me for money and I don't like that. So, so try to get up front. If someone's expecting money, get that up front. And then I wanted to bring this idea of these inventory guys, these wholesale guys. Any questions on that?