Daisy
Chains!!! Two words that can kill your finder's fees business!
Why?
Before we tell you why, let's
talk about what exactly these two words when combined together spell disaster
for a professional finder.
What is a "daisy chain?
It’s simply getting involved
with another finder who is not the direct representative of the Principal, but
probably claims he is working with another finder who claims he is. The third
finder, wishing to impress other finders with his closeness to top principals,
may be, in turn, only dealing through a
fourth, fifth, sixth, even up to ten, twelve or more other finders.
Once you get sucked into such a
web, you are starting out on a trip to No-Wheres-Ville! The whole thing is a vicious
circle: much like the small mail order dealers who "co-publish" all
kinds of ad sheets and cheap mimeographed magazines and do nothing but try to
sell to each other.
In short, you'll end up in a
market that is no market; you'll waste your time and money and brain energy
senselessly and, 999 times out of every 1,000, fruitlessly. A barrel of crude
oil, for instance, can stand an absolute maximum of about 3 cents per barrels
in total fees added. (This field, crude oil, is one of the very best big
moneymaking areas of the finding business).
If you're dealing with just one
other finder on such a deal, fine - you'll both pocket a small fortune on, say,
a sale of 500,000 barrels at 1-1/2 cents to you, and 1-1/2 cents to the other
finder. For example, a total of eight are in the act, and all demand 3/4 cents
each. The deal is killed, and nobody gets paid. Do you follow me already?
The "daisy chain" can
ruin your various deals in other ways. Many of these finders will sometimes
send you a name and say, "try this" (for whatever deal they happened
to get wind of that you're working on).
Later, if the deal goes
through, one will claim that he was vitally instrumental in it, wave his
correspondence, send photocopies to you, and perhaps threaten suit if you don't
split with him.
Most often, these leeches are
about as bothersome as flies lighting on you while you're trying to sleep, you can't
always afford to completely ignore the "try this" letter.
If and when they come in, the
first thing to do is match dates. If the dates on your correspondence precede
his, forget it. If there is any question at all, reply that you already have
been working on it (whatever deal). Quote the date that you started, and cite any
full authorization exchanges of letters or formal contract that you might have
in your possession. This will usually make him back off, and you'll never hear
from him again. On the other hand, sometimes working in the "daisy
chain" is the honest, hard working finder.
One rule of thumb, in order to
determine how close to the principal he is, is to elicit from him full details
of the requirements. If he can supply
these to you, chances are he's close, perhaps only one other finder or broker
away from the principal. A three-way split of a Finder’s fee is about the
maximum you'll want to go. Obviously, two ways is better, and a single fee -
yours is ideal.
Personally, I've been in this
business for close to 3 years and nothing is BETTER than a single fee.
When
dealing with other Finders, it's usually quite easy to separate the men from
the boys. The professional finder will be euphonious. He/She will give elaborate particulars on good
stationery in a crisp, business like way, or a well-written email with their
business contact particulars in their signature file. The amateur, or
no-work/big-profit leech-type will send you the "try this" letter,
too often on shoddy paper with no details (simply because he/she doesn't have
any), or a terribly-written email with or without any contact information.
To sum it up: Avoid the
"daisy chain" as much as possible. When you must deal with other finders,
and sometimes this is essential, try to limit the number to two, and no more,
on any one transaction. Better yet limit to one other. And better yet, do what
I do - Do it yourself and follow the 10 Rules of Finding in my eBook, "Striking Gold in the Finder'sFees Business".
To Your Wealth,
Remington J. Penman
Check Out Our Other Blogs:
http://find4fees.blogspot.com/
http://biggunscartel.blogspot.com/
http://theratraceends.blogspot.com/
http://professionalfinders.blogspot.com/
http://biggunscartel.blogspot.com/
http://theratraceends.blogspot.com/
http://professionalfinders.blogspot.com/
“Failure is the condiment that gives success its flavor.”
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