Broker: Difference between revisions
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There are advantages to using a broker. First, they know their market and have already established relations with prospective accounts. Brokers have the tools and resources to reach the largest possible base of buyers. They then screen these potential buyers for revenue that would support the potential acquisition. An individual producer, on the other hand, especially one new in the market, probably will not have the same access to customers as a broker. Another benefit of using a broker is cost — they might be cheaper in smaller markets, with smaller accounts, or with a limited line of products.<ref name=Spiro>Spiro, Rosann L., William J. Stanton, and Gregory A. Rich. Management of a sales force . 12th ed. Boston: McGraw-Hill/Irwin, 2003</ref> |
There are advantages to using a broker. First, they know their market and have already established relations with prospective accounts. Brokers have the tools and resources to reach the largest possible base of buyers. They then screen these potential buyers for revenue that would support the potential acquisition. An individual producer, on the other hand, especially one new in the market, probably will not have the same access to customers as a broker. Another benefit of using a broker is cost — they might be cheaper in smaller markets, with smaller accounts, or with a limited line of products.<ref name=Spiro>Spiro, Rosann L., William J. Stanton, and Gregory A. Rich. Management of a sales force . 12th ed. Boston: McGraw-Hill/Irwin, 2003</ref> |
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==Etymology== |
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The word "broker" derives from [[Anglo-Normandian]] ''brocour'' "small trader," of uncertain origin, but possibly from [[Old French]] ''brocheor'' "wine retailer," which comes from the verb ''brochier'' "to broach (a keg)."<ref>{{OEtymD|broker|accessdate=2010-04-10}}</ref> |
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==Types of brokers== |
==Types of brokers== |
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Revision as of 17:07, 15 February 2012
A broker is an individual or party (brokerage firm) that arranges transactions between a buyer and a seller, and gets a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Distinguish agent: one who acts on behalf of a principal.[1]
In general a broker is an independent agent used extensively in some industries. The prime responsibility of a broker is to bring sellers and buyers together. Therefore, a broker is the third -person facilitator between a buyer and a seller. An example would be a real estate broker who facilitates the sale of a property.[1]
Brokers also can furnish considerable market information regarding prices, products and market conditions. Brokers may represent either the seller (90 percent of the time) or the buyer (10 percent) but not both at the same time. An example would be a stockbroker, who makes the sale or purchase of securities on behalf of his client. Brokers play a huge role in the sale of stocks, bonds and other financial services.[1]
There are advantages to using a broker. First, they know their market and have already established relations with prospective accounts. Brokers have the tools and resources to reach the largest possible base of buyers. They then screen these potential buyers for revenue that would support the potential acquisition. An individual producer, on the other hand, especially one new in the market, probably will not have the same access to customers as a broker. Another benefit of using a broker is cost — they might be cheaper in smaller markets, with smaller accounts, or with a limited line of products.[1]
Etymology
The word "broker" derives from Anglo-Normandian brocour "small trader," of uncertain origin, but possibly from Old French brocheor "wine retailer," which comes from the verb brochier "to broach (a keg)."[2]
Types of brokers
- Aircraft broker
- Auto broker
- Broker-dealer
- Brokerage firm
- Business broker
- Commodity broker
- Customs broker
- Energy broker
- Information broker
- Insurance broker
- Investment broker
- Joint venture broker
- Leasing broker
- List broker
- Marriage broker
- Mortgage broker
- Options broker
- Power broker (term)
- Prime broker
- Real estate broker
- Retail broker
- Ship broker
- Sponsorship broker
- Stock broker
- Office broker
- Serviced office broker
- Website Broker[3]