A. THE AVERAGE BROKER/AGENT INTERMEDIARY TODAY FAILS & EARNS NO INCOME
According to studies, primarily because of the central role that the Internet has played in international trading, the real market for the intermediaries or middlemen in the international ‘secondary’ market trading has been collapsing quite rapidly in recent times. Estimates from such experts and accounts by the experienced trader assert that the year 2000 was the last “good year” for the business intermediary. Kamal J. Southall, for example, maintains that “after 2000, the critical mass of brokers and traders who were ill-informed and poorly trained, as well as of fraudulently applied offers and scams, reached the point that real end-buyers, manufacturers and suppliers simply stopped responding [to intermediaries] except in exceptional cases.”
B. MAJOR REASONS ACCOUNTING FOR THIS
Many factors account for this. Briefly summed up, they range from the dramatically increased number of scams and fraudsters in the business, made much easier by the shield of anonymity provided by the Internet, to relative lack of proper training, skills, or knowledge in the fundamentals of the business prevalent among the modern class of brokers and other intermediaries as a result of the easiness of requisite qualification for one to become an Internet “broker” or intermediary, to the element of the increased pervasiveness of “The Joker Broker” mentality and behavior among the Internet-era brokers, agents & other intermediaries.
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C. THE BASIC WAYS MISGUIDED BROKERS & AGENTS BECOME THE MAIN OBSTACLES
Broadly speaking, there are a few basic, identifiable major ways in which this rather awesome phenomenon of the modern overzealous and misguided Internet broker or agent constitutes an obstacle to successfully doing business frequently manifests itself.
USE OF BADLY FLAWED & IMPRACTICAL METHODOLOGY AND PROCEDURES IN DOING BUSINESS
But, probably the most impactful but pervasive way and how the overzealous and misguided broker/agent intermediary frequently constitutes himself (or herself), whether intentionally or unintentionally, into a crippling obstacle, rather than an aid or facilitator, to successfully doing petroleum deals or closing one, is basically by their use of methodology and procedures which are badly flawed and erroneous, unrealistic, unreal, impracticable, and oftentimes downright pie-in-the-sky like and comical.
SO, WHY DO THESE JOKER BROKER TYPES INTERMEDIARIES STILL PERSIST IN USING THESE FLAWED PROCEDURES, NEVERTHELESS?
Given the central reality we’ve just sketched above, to the effect that these procedures and methodology are often inappropriate or unworkable and invariably fail, and no income on the part of the Internet intermediaries, a major curious question of immense relevance is this: Why then? Why then is it that these Internet intermediaries generally refuse to use the correct oil deal procedures but plunge ahead anyway, and still engage in doing business using precisely those same badly flawed and unproductive procedures? Or, to put it another way, what forces or interests impel them to keep conducting business that way, any way, such that, in effect, by conducting business that way, that precise role that such intermediaries play generally makes them, whether wittingly or unwittingly, a prime obstacle on their path, and the path of most other intermediaries, in being able to close deals or to earn income?
THE ILLUSTRATIVE CASE OF THE USE OF THE LOI BY OVERZEALOUS INTERNET SELLERS & INTERMEDIARIES
A good case in point for illustrating the above point is the frequent resort to using the so-called “LOI” (Letter of Intent) by Internet agents and intermediaries in initiating trade offers. The LOI (Letter of Intent) document is a central procedure common among many present-day Internet brokers and intermediaries, and some sellers. These brokers and intermediaries would frequently demand that any intending or interested buyer should first present the LOI document to show and initiate an interest in a trade offer or make a purchase. And, according to such intermediaries, intending buyers should do so because, they say, by signing such a document at the very beginning of the selling process and handing it over (through them, of course!) to a supposed supplier of a product, that gesture, they claim, constitute a great demonstration of the legitimacy of interest on the part of the would-be buyer, and would be showing that he (she) is “serious” about making a purchase.
There is another basic major way the new role of the overzealous, misguided Internet broker or agent as an obstacle to successfully doing business frequently manifests itself. The pernicious effects are often brought about by the phenomenon of the long string or chain of brokers, agents, and intermediaries involved in the process, with most of them undercutting each other.
D. OTHER BASIC WAYS IN WHICH SOME MISGUIDED BROKERS & AGENTS CONSTITUTE THE MAIN OBSTACLE
Other basic ways in which the new role of the overzealous, misguided Internet broker or agent as an obstacle to successfully doing business frequently manifests itself would include the following:
1. Presentation of Unverified Material with No Due Diligence
This is one of the most notorious hallmarks of the ‘joker broker’ type brokers and agents who typically operate on the Internet today – they generally present offers, ‘SPA’ contracts, and ‘deals’ that lack any VERIFICATION whatsoever, or one upon which any DUE DILIGENCE has been done as to their authenticity, genuineness or intrinsic worth or value if any at all. Thus, as these intermediaries can send hundreds, even thousands, of email offers simultaneously to several dealers, with virtually none verified or even verifiable, one major result of this is that, in the noted words of one expert, “Suppliers can’t be bothered to reply to dubious purchase offers or requests for quotes. Similarly, the end buyers won’t reply to equally stupid offers.” And thus, resulting in a failed market, with no deals generally closed by most intermediaries, nor any commission income ever being earned by any!
2. Lack of Knowledge of Product:
Frequently, the intermediary who comes offering a ‘deal’ or bearing a ‘SPA’ Contract form woefully lacks any working knowledge of the petroleum product or market that he (or she) purports to be selling – matters like the standard quality specification of the product, or its current price in the world market, the production capacity of crude for a country, and the like (not to speak, of course, of knowing the proper methodology, rules or procedures of the business). Clearly, how can one market a product that one knows nothing about? Often, the intermediary’s stark ignorance is soon exposed when such an intermediary gets asked certain basic, elementary questions by the interested buyer or his agent. The intermediary comes back, usually after several days of inaction, with something like, ‘I’ve sent your questions to my seller, and I’m waiting to get the seller’s reply! ‘
Or, even worse still, a buyer whose interest in an offer might have become ignited in the deal might place a phone call to the intermediary wanting to ascertain if he is knowledgeable about certain aspects or facts of the product or offers that the intermediary purports to market since it’s been amply shown that an experienced trader could get a fair assessment of the seriousness or genuineness of a supplier or the offer he’s peddling by merely ‘feeling the pulse’ of the supplier or his purported representative through a mere telephone conversation. However, being that the average Internet intermediary often lacks the requisite knowledge about the petroleum product he purports to market (not to speak of knowledge of the rules and procedures of the realm of international trade, generally), far more often than not, the intermediary losses the opportunity to cultivate the crucial trust and credibility factor with the buyer through mere demonstration of knowledge about the product or offer he purports to market.
