DOTC: Bringing on the Barter

Let's get back to brass tacks today, and do it on the cheap!

As a small business, you often need many products or services that you simply can’t afford to buy outright.  This can be especially true in the very beginning of a new business.

One way to work around this is to go very, very old school  - barter.

Not only does it help you get around a cash shortage, it’s also a way to get your service/product out there, and hopefully, have a barter client who will sing your praises, perhaps via a recommendation on your web site or on LinkedIn.

Note:  referrals and recommendations are a "currency" that can help you out big-time, so don't discount the value of this.

So, how would this work?

A pot of honey for a mauling?  DEAL!

Let’s say, for example, you are a bookkeeper.  You need a logo created.

I bet, if you are out there leads referral networking (and if you’re not, why aren't you? It’s one of the best cheap tactics around), you know a graphic designer or know someone who can recommend a good one. 

It is very possible that your designer friend needs somebody to set up their Quickbooks.  Maybe the time it takes the designer to whip you up a logo is similar to the time it'd take for you to set up Quickbooks.  Thus, it would be a mutually agreeable arrangement for both of you to barter this service.

In my opinion, this works best with services trading for services, but there's no reason why you can't do it for goods.

The possibilities are endless, but here's some services I bet you could find a barter partner for:

• Graphic design
• Copywriting
• Web hosting
• Bookkeeping
• Cleaning services (especially if you have a physical location, like a martial arts school or a small office)
• Administrative services
• Execution of social media
• IT services

Note: When bartering, do make sure you are trading equally - that is, the value of your time (or cost of goods) versus what you receive in trade needs to be relatively the same.

You don't want to give more than you get, right?

Track the value of barter just as you would as if you were paying cash, and evaluate the return on investment the same way.

Also - talk to your bookkeeper or accountant about how that needs to be tracked, as it is considered taxable income by the IRS in many cases.

Have you ever used barter in your business?  I'd love to hear about it in the comments!