Once you have decided that you want to charter a yacht, the next thing you need is a charter broker. This article aims to answer the following questions:
- What is a charter broker?
- What is a central agent (CA)/ clearing house?
- What does a charter broker do?
- Do you need a charter broker?
- Can anyone become a charter broker?
- What to look for in a charter broker?
I hope to be able to answer these questions for you today.
1. What is a charter broker?
A charter broker is a type of specialist travel agent who is an intermediary between clients and central agents. They offer a bespoke service to clients to ensure every charter is personalised; listening to what you want and matching you with your dream yacht and crew. They attend boat shows to view charter yachts and meet crews to recommend to their clients, often invited to dine or sail on board to experience the crew in charter mode and sample the chef’s menu. Brokers treat you like human beings and will speak to you in whichever format your prefer: scheduling a meeting, calling, WhatsApp, email.
2. What is a central agent (CA)/ clearing house?
A CA/ clearing house functions as a yacht representative, they advertise yachts on behalf of an owner on online broker only portals. Brokers approach them about yacht availability, rates and information. They check the contracts on behalf of the owner and hold client money safely in an escrow account before passing funds to an owner who does not receive the charter fee until after the charter has finished and guests have disembarked. All inclusive charters are slightly different where money is passed to the owner 40 days prior to embarkation.
3.What does a charter broker do?
A charter broker firstly finds out what an individual is looking for: type of boat: sailing, catamaran, power catamaran or motor yacht; number of guests; location; dates; budget.
They then search their preferred online broker portal for a boat fulfilling as close as possible the above criteria. Boats are proposed to a client who will then shortlist those yachts. The broker then approaches the CA to check availability and explains what their client is looking for. Once all the details are confirmed and a client likes the look of a specific boat. The broker will then ask for the contract details from the CA. The broker has access to industry standard contracts.
The broker’s responsibility is to fill in the contract details. I will do a separate blog on the types of contracts that we use. These are all legal documents with only certain editable elements to ensure there are consistent terms for all charters. Once approved by the CA, the broker must send the contract for signature and conduct “know your client (KYC)” on the client. This is to ensure they are not on any kind of sanctions list and to uphold ethical standards.
Once the contract is fully signed a first deposit must be paid to the value of 50% of the charter fee. Final payment is due one month prior to the charter commencement date.
The charter broker is subsequently responsible for client/ crew liaison, itinerary planning, organising transport and reservations.
4.Do you need a charter broker?
Yes – some CAs are also brokers such as at diYachting so we accept direct clients. Going direct to the owner has risks as there is no client protection – they do not have access to industry standard legal contracts. Avoiding the commission could end up costing you far more in the long term. In terms of CAs and brokers -there is no way of avoiding broker commission and the percentage is the same for all brokers.
Do brokers even see the boats they are chartering to guests?
Brokers attend charter shows where they view charter ready yachts. They’ll inspect the quality, maintenance and attention to detail. They meet the crews and get invited on board for lunches, parties with cocktails and canapés and also get invited on day or overnight trips to test the crew and see the destinations.
There are also “open house” events that brokers may attend.
Do brokers know much about the destinations?
Many brokers, including us at diYachting, are former crew so have sailed in many destinations, they get the chance to regularly visit some locations where charter shows are hosted: Poros and Nafplion, Greece; Sanremo, Italy; BVIs; USVIs; Turkey; Antigua; Bahamas etc.
5.Can anyone become a charter broker?
In theory, yes but central agents and brokers will only work with trusted companies. and individuals.
Is the industry regulated at all/ how can you make sure your charter broker is legitimate/ not dodgy?
There is a voluntary membership with any of the three following broker associations, CYBA, IYBA and MYBA. All of which set ethical and legal standards for operating safely and securely. CYBA lists individual brokers whereas MYBA lists companies. If ever in any doubt you can search for a broker on these platforms to check their legitimacy.
Lizzie Abbiss is an active CYBA member and is also on the CYBA board.
6.How to choose a charter broker?
The best place to start is the CYBA active members directory, you can see the Active members and links to their company websites.