Entrepreneurs Can Benefit From One of the Most Time-Tested, Yet Overlooked Business Methods.
By Mike Foley
Picture This: You need goods or services for your business, but the economy is tight and you simply can't afford it. What do you do? Borrow the money and take the business further into debt?
Unfortunately, many entrepreneurs fail to see beyond that rather bleak possibility. In fact, many overlook one of the most time-tested methods for staying on track in a slow economy--bartering. But every day, businesses all across the country barter services and ensure their survival, using little or no cash. Recent estimates indicate that approximately 62 percent of companies listed on the New York Stock Exchange use bartering as a standard business practice.
Without bartering, for example, the Dream Merchant would not have increased its subscription base and controlled its expenses in the early days of operation. Publisher John Moreland often bartered ad space for printing services or booths at various trade shows. In addition, he also swapped mailing lists with other invention organizations and even garnered the precious trade show booths with a mailing list swap.
"Bartering is great," says Moreland. "It's a service-for-service arrangement that can really save money. That's a great tool when you're starting out."
So how do you put bartering to work for you? Consider the following:
1. Ask--When you're seeking goods and services from another business, ask yourself what you can offer them. And then take it a step further. Ask them if bartering might be a possibility for that particular transaction. You'll be surprised how often you hear the word, "yes."
2. Join Trade Organizations--Those who do business in the same industry often join together in trade organizations, offering consistent opportunities for networking and, therefore, bartering. Talking with other business owners will give you an idea of what their needs are and how you might be able to help each other.
3. Bartering Clubs--Organizations that focus specifically on bartering range from small local clubs to large associations. When registering with one of these organizations, you simply list your needs, along with the services you can offer. The club then searches its database to find a match. This is often a quick method of finding help and kick starting the barter process. Many of these clubs and organizations have websites, making registration and matching an easy process.
In a slow economy, bartering can offer your business an alternative that makes sense, improving your cash flow and freeing up resources for transactions where cash is a necessity. If you haven't taken advantage of this common business practice, consider exploring it sometime this year.
"Why pay for business services when you don't have to?" adds Moreland. "With bartering, you can help and be helped, while tailoring the whole process specifically to your business."
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