DOTC: Barter Again!

Some time ago, I recommended that you consider using barter in your business.

I have several friends in small business doing this a lot, for both business and personal services and products.  In fact, I do this myself (for bookkeeping services, as I would rather chew on aluminum foil than do my books, thank you).

As you probably know, the big boys do this too.

Take Chrysler.

Recently, Chrysler was able to barter for a spokesman for their new Dodge Durango SUV.  And they got a big one:  Will Ferrell, in character as Ron Burgundy, for his upcoming movie, "Anchorman 2: The Legend Continues".  Here's one of my favorites:

Chrysler gets a free (and memorable) pitchman for their ads, and Paramount Pictures gets free promotion for their movie release.  Win-win for all concerned.

Learn more about this here:

http://www.syracuse.com/entertainment/index.ssf/2013/10/will_ferrell_dodge_ads_anchorman_ron_burgundy.html

You stay classy, San Diego.

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!