Revenue down? Bartering is on the up!

A drastic change in the economy calls for businesses to adapt in order to keep afloat, let alone make a profit. Redundancies, reducing overheads; you know the types of things!

The great thing is, businesses can keep “open as usual” thanks to bartering. It’s nothing new, in fact, before a monetary value was put to note and coin, that’s how the world worked. So is it time for bartering to come back? It already is!

You wouldn’t know it, but bartering is big, on a world wide scale. There are barter networks full of thousands of businesses, all looking for the next good trade; but why!?

Barter makes use of something that almost every business has; idle resources. If a business has idle resources, there is room to make or save money using bartering. By thinking outside of the box, businesses can start to get their revenue figures back on track.

Idle resources could be anything; it really depends on the business. A web design firm may be paying staff 8 hours a day, but only have enough work for 6 hours a day. A camping wholesaler may have gone a bit crazy with the whole “economies of scale” approach and been left with 1,000 extra sleeping bags; items they might never sell!

Using the barter system, they could do a two way exchange and swap goods/services they don’t need, for ones they do. Sounds simple? Not always!

Barter networks are great things. One of the main problems with the barter system is a business may find another business offering what they want, but the feeling is not mutual. The transaction will never happen without a facilitator.

Most barter networks have something called “trade dollars” and this is what helps them become the facilitator. So if a business charges $50 per hour for their time and barters 10 hours services, they are gifted 500 in trade dollars. They then use those trade dollars to purchase goods/services in the barter network that they require.

A lot of businesses barter their goods/services out at a lower rate, to ensure they are running at full capacity. They pick up extra business (possibly even long term clients), but this has no direct affect on the consumers that pay the sticky prices they offer on a day to day basis.

Business is changing. Cash sales might be down for the majority, but this can be easily compensated by getting involved with bartering and making use of those idle resources!.

 

 


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2 responses to “Revenue down? Bartering is on the up!”

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  1. Karl says:

    Good point Grant, I’ve used barter a few times in my business and it can be very beneficial (especially when cashflow is tight).

    The challenge with it, I found, is finding an equally beneficial exchange. I ended up doing loads of work for a barter deal which cost me more than what I got out of it.

    Cheers,
    Karl

  2. Grant says:

    Sometimes there is that. If the people involved have not had too much experience trading, then it can be a lot of work, for not much in return, just like you say. Like anything though, with experience, the trades are likely to get better.

    I’ve spoken to someone that has agreed to design & build a website for me in return for writing, which is easy, as it is a straight swap. Some deals can be complicated, but service provider to service provider deals are usually pretty simple.

    Thanks

    Grant