Is it better to spend cash, use credit, or barter?
Any business owner that bartered goods or services without spending any money last year, would easily answer that question without thinking twice. Bartering is a practice that originates back to 9000 B.C. when livestock was traded for other goods. This trend has become popular again after the recession of the late 2000′s. Of course, we’re not living in ancient Egypt, when you could just head to the local market and trade fresh farm eggs for a fancy scroll of papyrus. Bartering is still done today through swap meets and online sites like Craigslist.
But, there are more sophisticated barter methods that enable people and businesses to use “barter dollars” to trade goods or services for credit they can apply to something else on the exchange. These organizations charge a variation of transaction fees but you do get paid your prevailing retail rate for an item or service in barter dollars. The benefit of using an exchange, is that the network of bartering businesses is at your fingertips.
Have you been thinking about testing the barter waters? The contributing source for this blog, went out to find those who’ve embraced the barter way of life, exchanging their time and talents to snag everything from travel perks to massages and other good or services, for free! Here is just one example from their article;
“I Swap Eye Exams for Home Renovations”
Fourteen years ago, Kim Parr, 41, an optometrist in Cortez, CO, followed the lead of a doctor she knew and decided to barter with some of her clients when they had a home-specific service to offer—from painting to handyman work. “It wasn’t something I did all of the time, but on occasion it made sense,” Parr says. “If the cost of glasses plus an exam is $300 retail, it might only cost me a third of that amount, but I still get $300 worth of services or product in return.” And, luckily, she’s only had one not-so-great bartering experience. A patient owned a flooring store and Parr just so happened to need new carpeting. Since his whole family needed eye exams, they agreed to barter. “Unfortunately, he went out of business before we could take advantage of the full amount of the credit,” Parr says. “So, if you do barter, make sure the trade happens quickly!”
6 Helpful Bartering Tips
Before you close your first barter deal, review these tips so you can get the best bang for your barter “dollar.”
- Research Price Points: If you are offering a professional service, you already know what your standard rates are but you will want to research the rates of the service or goods you are looking to get.
- Focus on Value: A trade doesn’t need to be between services or goods of equal value. You can choose to offer extra time for something that you really want.
- Track Time When Necessary: TimeTrack is a free site and application to track your time when working on a barter project. There are many other time tracking options as well.
- Be Smart: When you barter with someone that is going to get on a ladder or fix your electric, make sure they are licensed and insured.
- Pay Taxes: Although bartering doesn’t involve cash exchanges, you are required to pay the government on the goods and services you swap. To learn more, review the IRS’s guide to bartering.
- Find the Best Barter Resource: With over 1,000 online barter exchanges, it is important to find a long-standing reputable exchange with a large and industry diversified network of members, to choose from. It is also important that your trade value is dollar for dollar with low transaction fees. To find a barter exchange in your area, consider AGA Barter Exchange, offering the largest network of members doing trades all over the world. With personalized mentees offering personalized service and unique benefits, you will enjoy the increased value in your barter transactions.
AUTHOR: Angela Gonzalez, Owner of AGA Barter Exchange, an Independent Mentee of ITEX Corporation, enjoys helping small to medium size businesses save their cash flow, while enhancing their business and life style with nurturing relationships through barter exchange and personalized attention.