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Author Topic: Trainer commissions  (Read 3995 times)
GGNJ
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« Reply #25 on: February 21, 2010, 02:36:04 PM »

 That's where the question gets sticky.  The owner is likely depending on the trainer's knowledge of whether the horse is worth it or not.  Also, you might have the selling trainer and the buying trainer both taking a cut... and if the 2 of them are buddies....

I understand there are owners who don't really understand the business. That's OK. However, for owners who do---those who treat horse ownership like a business, know the business, etc.---they should not be relying on the trainer as far as whether or not the horse is "worth it" so to speak. I've never asked a trainer if a horse is worth it. I ask them about things that fall under their area of expertise, and "worth it" is not one of them. I make decisions about my money and my investment. Not them. "Worth it" is a business question and economics. That's my area of expertise, not theirs.
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« Reply #26 on: February 21, 2010, 02:39:42 PM »

15 or more years ago, taking "cash off the top' was the standard operating procedure but not anymore. people who strictly broker horses get a standard 10% but a trainer making a private purchase doesnt do much of that anymore. For all the reasons listed....it USED to be one of those "cost of business" things...an implied part of the deal.

Agents today SHOULD get a standard 10% or less if appropriate. But IMO most don't. A few might.

As far as the trainer's role--I might send them to train the horse for me. Of course I get billed for the travel expenses. I'll have the horse vetted and I pay for that. I'll talk to my trainer, but I am doing all the homework.

But I don't think that's the reason a trainer should not be making money on my deal.
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Claiming King
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« Reply #27 on: February 21, 2010, 02:41:22 PM »

I was in the horse business for over 30 years, if you are selling a horse you can get what ever the market bares. If you are my trainer and you suggest I buy a horse and add 10% or 15% on the side with the seller, you are ripping me off. You need to tell me before hand that the horse you are suggesting for me to buy, and "YOU" will be training, that you are charging me a fee.

That's not the same thing. A better example would be that you have a business partner in a building business where you handle the accounting, permits, approvals, and your partner handles the materials purchases. He asks the supplier to pad the price 10% or 15%, and asks the supplier to pay him a fee under the table. What would you think of your partner if you find out?

If you think I'm "ripping you off", you're welcome to go find and buy your own horse and we'll see what guys like Monte Gelrod or Charlie Karp do to you when they get ahold of you. I'll still train the thing when you bring it to me, but don't get angry when you paid $40,000 for it and I tell you it needs to go in a 20 claimer. It seems like you want my expertise but you're unwilling to pay 10-15% for it. If you don't trust me to watch out for you, go down the shedrow, you'll find someone. But let me warn you, he likely won't have as much integrity as I do.

And your analogy isn't fair either unless the guy handling the accounting and permits has the ability to kick the materials partner out when carpenter Lou Pena comes along with super bricks.

It seems like you think it's a "partnership" when it's to your benefit, but I owe you some kind of loyalty you're not willing to afford me. Ackerman and Staley isn't your standard trainer-owner relationship.
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« Reply #28 on: February 21, 2010, 02:48:00 PM »

Ackerman and Staley isn't your standard trainer-owner relationship.

 Damn! Another bubble burst.
 I thought that's how all horsemen were preparing for their golden years Wink
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Regards Don
GGNJ
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« Reply #29 on: February 21, 2010, 03:33:49 PM »

I was in the horse business for over 30 years, if you are selling a horse you can get what ever the market bares. If you are my trainer and you suggest I buy a horse and add 10% or 15% on the side with the seller, you are ripping me off. You need to tell me before hand that the horse you are suggesting for me to buy, and "YOU" will be training, that you are charging me a fee.

That's not the same thing. A better example would be that you have a business partner in a building business where you handle the accounting, permits, approvals, and your partner handles the materials purchases. He asks the supplier to pad the price 10% or 15%, and asks the supplier to pay him a fee under the table. What would you think of your partner if you find out?

If you think I'm "ripping you off", you're welcome to go find and buy your own horse and we'll see what guys like Monte Gelrod or Charlie Karp do to you when they get ahold of you. I'll still train the thing when you bring it to me, but don't get angry when you paid $40,000 for it and I tell you it needs to go in a 20 claimer. It seems like you want my expertise but you're unwilling to pay 10-15% for it. If you don't trust me to watch out for you, go down the shedrow, you'll find someone. But let me warn you, he likely won't have as much integrity as I do.

And your analogy isn't fair either unless the guy handling the accounting and permits has the ability to kick the materials partner out when carpenter Lou Pena comes along with super bricks.

It seems like you think it's a "partnership" when it's to your benefit, but I owe you some kind of loyalty you're not willing to afford me. Ackerman and Staley isn't your standard trainer-owner relationship.

I disagree. There is a capital at risk question. There is the generally accepted business practices that we've seen in the industry.

I don't think it's a question of "ripping off" and using Monte or Charlie as an alternative. Two different issues. You want to deal with Monte or Charlie--you know you are dealing with the devil. Buyer beware. For the most part, they will look to make whatever they can on a deal and being it's their scam--they are good at it and they have the upper-hand. More often than not, they will beat you and get away with it. That's why they are still in the business.

If an owner is buying a horse, the trainer should be involved in the transaction. That's the business. An owner shouldn't buy a horse without the trainer's involvement. However, in my mind---it is not a question of wanting expertise and not wanting to pay for it. It's not a matter of trust either in my eyes. I pay a trainer to train my horse, and expertise goes along with that everyday---training, when, where, where to enter, etc.---and that's racing my horse. I put up capital at risk, not the trainer. I pay him a day rate---the price he asks and he set. If I am looking to buy a horse I found, or an agent brought me---I pay his expenses to go as I said.

He gets his daily rate and a percentage of earnings. If I sell the horse for a profit, I am more than willing to pay the trainer for that, and I have. But if a trainer is asking me to pay for him "protecting" me or for his "expertise" which relates to the deal itself---I wish the trainer all the best.
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Claiming King
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« Reply #30 on: February 21, 2010, 04:01:00 PM »

Like I said, in my view it's the opposite. I'd never ask a client to spiff me on the sale of a horse I improved. That's why he chose me to train for him. If he wants to give me something, I'll gladly take it and be appreciative.

But when I'm going out and finding the horse, cutiing the best deal, and doing all the work, I don't think there's anything unethical in the least in my marking the price up without telling you. You know the price I told you. Make the call. You don't want the horse? No hard feelings. I'll find a buyer.

Turst is a two way street. Don't you think there are guys out there right now that found horses for clients, whether they charged a mark-up or not, and those clients are telling those trainers, "Hey, I'm sorry but I've got to move the horse to Josh Green or Lou Pena. We just can't compete the way you're doing it." And I've seen owners claim their own horses because they didn't have the balls to have that conversation with a trainer. And don't tell me it's a case of two wrongs. You're not going to convince me that marking up a horse is wrong. Show me that you're Richard Staley and I won't mark him up. I guess your answer might be, "Show me that you're Doug Ackerman." Well, I'm not so let's get in the real world.
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« Reply #31 on: February 21, 2010, 04:04:13 PM »

Like I said, in my view it's the opposite. I'd never ask a client to spiff me on the sale of a horse I improved. That's why he chose me to train for him. If he wants to give me something, I'll gladly take it and be appreciative.

But when I'm going out and finding the horse, cutiing the best deal, and doing all the work, I don't think there's anything unethical in the least in my marking the price up without telling you. You know the price I told you. Make the call. You don't want the horse? No hard feelings. I'll find a buyer.

Turst is a two way street. Don't you think there are guys out there right now that found horses for clients, whether they charged a mark-up or not, and those clients are telling those trainers, "Hey, I'm sorry but I've got to move the horse to Josh Green or Lou Pena. We just can't compete the way you're doing it." And I've seen owners claim their own horses because they didn't have the balls to have that conversation with a trainer. And don't tell me it's a case of two wrongs. You're not going to convince me that marking up a horse is wrong. Show me that you're Richard Staley and I won't mark him up. I guess your answer might be, "Show me that you're Doug Ackerman." well, I'm not so let's get in the real world.

But that's not trust. Trust is not in the trust of not asking or telling. It's in the full disclosure and that's part of the problem in this game. The Sales Integrity Task Force in the t-bred business are trying to address these issues with transparency, full disclosure, etc. When someone says don't ask--just trust me--but they don't have capital at risk and I do---I ask.

Like you said, difference of opinion. I think we need to look at the norm and generally accepted business practices.

I wasn't talking about a trainer finding a horse. But if one did and asked for a commission, while he was going to train the horse, bill me for the expenses, etc---and he's going to only do the work that he normally will do as I do a lot myself---then I am am not going be able to have a business relationship with that trainer. Let's remember who the client is here.
« Last Edit: February 21, 2010, 04:06:24 PM by GGNJ » Report to moderator   Logged
looking in
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« Reply #32 on: February 21, 2010, 04:12:13 PM »

Is Mike Deutsch still active as an agent.
This goes back a few years.
I think he is a lawyer now days.
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I am just an old "Hoss" trainer, that has been raced hard and put away wet. 
As my Friend from Maine(Ora Stratton) says "There are horse trainers, and then there are real "Hoss" trainers.
GGNJ
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« Reply #33 on: February 21, 2010, 04:15:39 PM »

Is Mike Deutsch still active as an agent.
This goes back a few years.
I think he is a lawyer now days.

Mike has been a lawyer for a long time. Not always practicing of course. I don't know how active he is an agent, maybe a bit here and there, if he sees something, etc. I don't think it was ever his primary focus, although it might have been a good idea. Being an attorney could have given him an advantage in certain aspects of the business.
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Claiming King
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« Reply #34 on: February 21, 2010, 04:17:11 PM »

GG- I respect your opinion on this and I understand what you're saying. I think the sport would be better with a whole lot more Richards Staleys and Doug Ackermans. Heck, the world would be better. But while you're concerned with your capital risk, as you should be, you're really not considering mine. I found that horse. I want him in my barn. I made the deal to buy him at what I sincerely believe is a good price and will still be a good price even after I add my commission. Our relationship is such that I offered him to you first. I could offer him to anyone. Are you willing to sign an exclusive contract with me to train that horse? I wouldn't even ask. Because I know what the answer would be. And I don't think it's a violation of trust for me to mark up the horse. There's no gun to your head to buy him. Once you do buy him I might win three in a row with him and sell him for a profit. That's your profit. Not mine. And it's your call on when to sell him. I'll give my opinion if you want it. You might also take the horse and, after seeing Marmaduke Hanover, take him from my stable and give him to Jeff LaPoff. That's my risk. Would that make you unethical? I wouldn't go that far. That's life.
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GGNJ
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« Reply #35 on: February 21, 2010, 04:18:04 PM »

Here in the NY/NJ area, there are some real "winners" when it comes to agents---and yes, I am being sarcastic. It's the one business where I am almost shocked that some of these guys are still around, yet along in the business.

I don't know what it is, but I can't believe some of these guys still have the ba11s to show their face, and they still haven't been banned from the game.
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GGNJ
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« Reply #36 on: February 21, 2010, 04:27:21 PM »

Thank you for the comment. The Staley/Ackerman relationship certainly is the rare exception, not the norm, so it's hard to compare that. Yes, I agree the sport would be better. But regarding your comments, about my capital at risk, let's be clear. I am however concerned about yours---you have none (capital at risk that as). You are painting a picture with an unobjective brush that doesn't change that fact. You have no capital at risk.

You, your business, gain by my capital at risk. The profit is supposed to be mine---it's my investment. You want the relationship you suggest---go partners with me and put up your own money. But I am still not going to pay you a commission for finding me the horse. You are not acting as an agent in my opinion---not when you are getting the horse to train. You want him in your barn, and you are getting him--and you get paid for that horse being in your barn. You offered him to me first? Please, that's nonsense in my opinion. Personally, I think you are way off base here.

Listen, we have a difference of opinion. That's all.

GG- I respect your opinion on this and I understand what you're saying. I think the sport would be better with a whole lot more Richards Staleys and Doug Ackermans. Heck, the world would be better. But while you're concerned with your capital risk, as you should be, you're really not considering mine. I found that horse. I want him in my barn. I made the deal to buy him at what I sincerely believe is a good price and will still be a good price even after I add my commission. Our relationship is such that I offered him to you first. I could offer him to anyone. Are you willing to sign an exclusive contract with me to train that horse? I wouldn't even ask. Because I know what the answer would be. And I don't think it's a violation of trust for me to mark up the horse. There's no gun to your head to buy him. Once you do buy him I might win three in a row with him and sell him for a profit. That's your profit. Not mine. And it's your call on when to sell him. I'll give my opinion if you want it. You might also take the horse and, after seeing Marmaduke Hanover, take him from my stable and give him to Jeff LaPoff. That's my risk. Would that make you unethical? I wouldn't go that far. That's life.
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Claiming King
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« Reply #37 on: February 21, 2010, 04:34:06 PM »

You are not acting as an agent in my opinion---not when you are getting the horse to train.

I'm training the horse at your pleasure. I have no guarantees. If you feel it's in your benefit, you'll move that horse. I've got all the connections to buy the horse. I'm working out the deal. You can do the same if you're able. You sound like you are. If you come to me with a  horse you want me to take half of, I'll consider it. And I'm confident enough in my ability to judge horseflesh that I won't be worried about whether you marked him up. If you can buy Pacinello for $15,000 and you want me to take half for $45,000 more power to you. I'm in.
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« Reply #38 on: February 21, 2010, 04:39:30 PM »

Mike has been a lawyer for a long time. Not always practicing of course. I don't know how active he is an agent, maybe a bit here and there, if he sees something, etc. I don't think it was ever his primary focus, although it might have been a good idea. Being an attorney could have given him an advantage in certain aspects of the business.
Thanks,
Mike was an owner/trainer/driver/agent,before he was a lawyer. Knew to get out and go back to school.
Sold some horses for me. Always treated me ok. 
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I am just an old "Hoss" trainer, that has been raced hard and put away wet. 
As my Friend from Maine(Ora Stratton) says "There are horse trainers, and then there are real "Hoss" trainers.
GGNJ
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« Reply #39 on: February 21, 2010, 04:58:49 PM »

Thanks,
Mike was an owner/trainer/driver/agent,before he was a lawyer. Knew to get out and go back to school.
Sold some horses for me. Always treated me ok. 

I met Mike a long time ago. I think early on he was more of the trainer/driver type, and then more training. I know he brokered a horse here and there. Going to law school certainly was a good idea. Is it ever a bad one? LOL. Many years ago, he got sick. Not sure of the details. He told me but I just don't remember. He had surgery or something, took time off. Recovered, came back good. Like I said, nice guy. Never worked him as an agent. He brought me a horse or two but nothing ever came from it. Seemed like he had integrity which to me is a very common thing to be missing with agents.
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« Reply #40 on: February 21, 2010, 05:20:42 PM »

Speaking of agents---we all know many of them. Anyone ever do business with Karp? I wouldn't. Refuse to. I think he's a detriment to the sport and business of harness racing. If a person is a bustout, degenerate gambler, that's a potential for a dangerous situation. Someone who has no integrity, needs money, etc.

What about Monte?

Anyone ever do business with Woody K.? Steve Manzi? Ernie Martinez? David James? Rob Tribbett? Kim Hankins (back in the day)? Jean Cloutier (don't think he's in the game any longer)? Jerry Glantz?

I haven't bought horses through any of them. My model was different, so I wasn't a good candidate to buy. Not that many of them didn't try. Many of them tried to sell horses for me. I've just found that many of them had a problem with disclosure, integrity, honesty and so on. Cloutier was good. He would send me the lines, sometimes videos also, and tell me whatever I wanted him to do or whatever role I wanted him to play was fine with him. He'd give me the owners name and number if I wanted, or he'd take care of everything.

Ernie was a bit enigmatic I think. On one hand, I think he was well respected as a farm manager when working for Perretti. He did a very good job there, and was considered to be a very knowledgeable "horseman." On the other hand, I think he has a questionable reputation to some extent as people have made comments to me. Not sure what the deal is there.
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« Reply #41 on: February 21, 2010, 05:35:34 PM »

monte was the best. buy for a hundred, sell for four, give to robinson and make a million with them.      easy game
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« Reply #42 on: February 21, 2010, 05:39:27 PM »

monte was the best. buy for a hundred, sell for four, give to robinson and make a million with them.      easy game

Maybe that's why he's still around, in the game. Never got caught, nothing came back to bit him in the butt, or whatever. Like I said, I have no idea.
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Claiming King
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« Reply #43 on: February 21, 2010, 06:06:19 PM »

I think that this thread and the various viewpoints is just evidence of how much the game has changed. Frankly, I'm glad my career ended up when it did. It seems to me that "looking in" is an old-time horseman like me and shares my view of adding a commmission and as Mel from Moline said, that's just the way it was done.

I will point out, GG, that capital isn't simply and solely measured in U.S. currency. It sounds to me like you consider a trainer to be an employee. I'm not judging or putting a value on that. The game has changed. Lou Guida couldn't understand why he didn't get the respect he felt he deserved and probably did deserve. He's a guy that changed the game. But oldtimers like me were put off by his style. It seemed to me like he treated Billy Haughton the way he might treat a floor clerk at the Board of Options. Now maybe that wasn't true and Billy wasn't complaining. If you want to succeed now, you've got to deal with "hands on" owners. That wasn't the case in my day. I didn't expect to be questioned and I would have told a guy to take his horse pretty quick.

Not to pick on Larry Baron, but here's this horse mogul with all these strong opinions, yet he's incapable of pricing a horse- the most basic element of the game.
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« Reply #44 on: February 21, 2010, 06:25:55 PM »

Like I said, we have a difference of opinion. I don't consider a trainer to be an employee. Not at all. I view them as a partner to some extent. But in the end he is a partner who does not put capital at risk. The current business model in this game dictates much of the way the business functions. I don't run my business like Guida or Baron. I don't know how Guida treated Billy. I knew Billy but that wasn't an everyday topic. He made some comments, so did Billy O', but that's a different topic. Guida didn't get the respect that he felt he deserved for a variety of reasons, but that too is a different topic.

To me, I don't care what they do. As much as I like and respect my trainers, and I've been with some of them for 25 years or so---in the end, cut away everything---and I am the customer and client. Now, with the relationship that I have with them---who the client is never comes into play. I am proud of that and that's because of the relationship. I am very proud of that. To me, it's mutual respect.

I have no idea whether or not Baron can price a horse. I don't know him personally, other than to say hello or something, and I don't know what he knows, don't knows, etc. I've never heard his opinions on important industry issues. As far as what a horse is worth, I rely on my own opinion on that. There are certain aspects, facets, etc. that fall under the trainer's scope and purview. Business decisions, with my capital, economics, and aspects related to that---that's my purview. That's the way I run my business. Doesn't make it right for others, but it's right for me.
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« Reply #45 on: February 21, 2010, 07:58:43 PM »

one question to add to the mix " How many trainers ,at a yearling sale, add a commission to the sale price when buying for an owner?"
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GGNJ
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« Reply #46 on: February 21, 2010, 08:17:58 PM »

one question to add to the mix " How many trainers ,at a yearling sale, add a commission to the sale price when buying for an owner?"

Where they buy a horse for an owner, and they are also going to train the horse?
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« Reply #47 on: February 21, 2010, 09:07:36 PM »

The price at a yearling sale is a matter of record. Theoretically anyone could have had that last bid. I don't know who would pay a commission. But I will say I've seen plenty of unwitting owners pay far more than they should have at sales when the sharks started running them. They probably would have been better off paying a commission to a guy who knew what he was doing.
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« Reply #48 on: February 21, 2010, 10:10:22 PM »

Great thread, again guys, well done. thumbs up As far as the yearling sale or any auction, that price is what it is. Not even in the same ballpark. keep up the good work.
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« Reply #49 on: February 22, 2010, 07:39:32 AM »

I don't know Larry Baron at all..
However, owners who have deep pockets are in many cases professionals who have acquired their wealth by double dipping and overcharging for their services.. Basically that have screwed lots of people to get ahead.
For them to worry about someone making 10% on a transaction is ridiculous.
These guys all seem to think their own time is valueable but the time of their employees and other hired help is not..
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