WHAT IS A CASH BUYER?
Within the ship recycling industry, companies such as GMS are commonly known as Cash Buyers. A “Cash Buyer” as the name suggests, is an entity that purchases a vessel for “Cash” from the owners and delivers it to a ship recycling yard (Ship Recyclers). Cash Buyers are not brokers. Cash Buyers are PRINCIPALS/TRADERS. Cash Buyers take delivery of vessels on both “delivered” and “as is where is” terms.
Business functions performed by a Cash Buyer include sale and purchase, financing (taking title of the vessel against full payment), market research, evaluation (forecasting future prices, demand/supply factors and other relevant business-specific issues) and risk management (underwriting market, operational, performance, currency, demand/supply, and various other risks).
Benefits of a dependable Cash Buyer to Ship Owners:
- Ease of delivery due to standardization of vessel descriptions and delivery contracts
- Negotiations conducted with a limited number of buyers rather than a multitude of ship recycling yards in several different countries
- One stop service… do not have to go to different yards in the world. Ship owners get intel on worldwide recycling markets and specific yards, with one call
- Guidance: since cash buyers do business with yards globally, they are BEST qualified to guide owners on various recycling options
- Receive intimate knowledge and current state of the individual recycling markets
- Cash payments instead of payments via Letters of Credit (L/C)
- Risk mitigation on behalf of the ship owners, especially in cases of a falling market, currency fluctuations, and unexpected legislative and regulatory changes
- Managing ship owners CSR requirements
- Ability to propose, guide, and execute green recycling contracts
- Financial stability to ensure hassle-free completion of agreements
Benefits of a dependable Cash Buyer to Ship Recyclers:
- Having a large inventory of vessels at all times gives ship recyclers the ability to choose a vessel of their choice
- Extensive financial experience helps in providing recyclers with the option of negotiating LCs (Letters of Credit) convenient to them
- Extensive understanding of local regulations and procedures makes delivery and beaching on the yard a hassle-free process
- Understanding the needs of the ship recycler pertaining to their requirements on the types of vessels, Lightweights they are able to negotiate, and their banking requirements makes every transaction a smooth one
- Exclusive local representation helps to offer personalized attention and the ability to cater to the needs of the ship recyclers
- Ability to forecast the markets on the supply-side as well as trends in the ship recycling sector helps to provide ship recyclers with the best service