Barter Your Way to Biz+Life Brilliance

by Annie

in showing you the money, strategery

Pink hand and blue hand

Bartering: Where one hand paints the other ... or washes. Or whatever. Anyway.

You can’t get something for nothing.

It’s a trite old saying and it’s absolutely true. Everything has a cost.

And when you’re a start-up, a newly-hatched digipreneur? Honey, you KNOW about those costs.

Everything has a price and it’s almost always way more than you thought it would be, thought it should be.

And then, there’s this: No matter how carefully you budget, no matter how much research you do, there’s not just a money-cost involved in a purchase. There’s the time/effort cost.

That awesome tool or software? You have to learn how to use it to best advantage, so there’s that cost too — the cost in terms of your time, your energy, your effort.

Here’s the deal. You’ve got time, and you’ve got money. You’re going to spend:

  • One, or
  • The other, or
  • Both

(That’s one of the 13 Principles of Pajama Productivity, by the way.)

But it’s totally OK, ’cause I have some awesome advice for you: Barter.

The Re-re-rebirth of Bartering

Way back in the day, of course, bartering was big business. It was all of business because money wasn’t the big deal it is now. People traded services for goods, goods for goods, services for services. You need your field plowed? Well, I gotta get my chicken coop built and I suck with the hammer thing but I’ve got a mule and a plow …

Bartering always made sense.

How did it go out of fashion? Probably something to do with the rise of the finance industry, the prevalence of credit in our lives. Buying and selling became the norm.

That’s not a bad thing, by the way. Money’s good. I like money. If you’re in business for yourself, either as an artist or a digital entrepreneur, you’re gonna have to get comfortable with the concept and the exchange process of money.

So why barter, then, if money’s all that?

Well, because it carries a much more significant value than a monetary exchange.

The Value-Added-Ness of Bartering

Bartering for what you or your business needs is a value-added transaction.

What I mean by that is this:

Say you need a website. There is absolutely nothing wrong with hiring a web developer (of course I say that, since I am one).

OK, let’s use a different analogy then. Let’s say you recognize that accounting and bookkeeping is not your strong suit and you need an accountant. You can go hire a CPA that works with small businesses like yours. You pay this CPA money and she takes care of your books.

The value is in the exchange of money for services. You get the services, your CPA gets the money which she can then go out and use to buy what she needs for her business. Let’s say she’s in need of some frames for the artwork for her office.

When you barter, you add another layer of value to the transaction. You still get the value of her services, but this time let’s say your business is — ta-da! — framing artwork and diplomas and such. So you exchange your services for hers. There’s the value of her services, and the value of your goods and services. You both get a client — and clients are valuable for much more than just the money they bring in. They go out and spread the word about how fabulous you are. And of course you do the same, ’cause your accountant rocks, naturally.

Here’s a real-life example. You see the header up there on this site? Pretty fabulous, I think. I didn’t pay a red cent for that. Another Word Carnival-er, the incredibly talented graphic designer evan austin, made that for me, in exchange for my services helping him with his marketing story.

I loved doing that, by the way. evan and I both received value in that transaction — my header, his marketing story.

And that’s to say nothing of the invaluable part of bartering, which lies in the much more personal nature of bartering over an arm’s length fair market exchange involving money. Simply put, I have a new friend, and he’s pretty freaking talented at what he does. Whose name do I mention when my clients need headers and logos? Right — evan’s.

Getting Started With Bartering

If you’re intrigued by the concept, but aren’t really sure where to start, here are a few suggestions:

  • Define clearly what you need. Don’t barter for stuff you don’t need, and make sure you know exactly what you’re hoping to accomplish through the barter exchange.
  • Figure out the value up-front. The worst thing you can do is get into an uneven barter exchange. If what you need and what you have to barter in return are not equivalent in value, then consider a mixed transaction, with cash or something else of value making up the difference.
  • Get crystal clear on the terms with your barter partner. Make sure you spell out in emails or in writing exactly what’s being bartered on each side, what value you normally attach to each service or good being bartered, when delivery of each is expected, and any other terms you think are important.
  • Keep a record of who’s good at what. This is something I’m working on myself by adding a note to each entry in my contacts app, noting the proficiencies and skills of the folks I meet or make contact with. I’m wondering whether a database like Bento would be a better place to keep that information, just to make it more searchable and user-friendly.

Barter Stories and Lessons Learned?

Have you bartered for things your business needed? What was your experience like? Let us know in the comments so we can all learn from each other!

This post is the Pajama Productivity entry in January’s Word Carnival, the theme of which is “Bartering.” Check out all the lovely Carnival-ers and the really smart stuff they have to offer!

Photo credit: Richard Dudley

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{ 22 comments… read them below or add one }

Sharon Hurley Hall January 25, 2012 at 2:20 pm

Love this, Annie, especially the importance of tracking. After a while you could have a whole network of professionals with whom you can barter services and who will promote each other.
Sharon Hurley Hall recently posted..Resolved: To Make No Resolutions

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Annie January 25, 2012 at 2:51 pm

Good point, Sharon! You can start small and build from there.

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Ilana Rabinowitz January 25, 2012 at 4:18 pm

I love this line “my header is his marketing story.” Now I will think of both of you when I need those services!
Ilana Rabinowitz recently posted..How To Barter Using LinkedIn

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Annie January 25, 2012 at 7:57 pm

Excellent! Again, welcome to the Carnival, Ilana!

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Tea Silvestre January 25, 2012 at 8:22 pm

I totally flashed on that scene in Phenomenon when Johnny Travolta’s character helps his neighbors all get what they need without exchanging money. It was definitely a win-win-win-win-win kind of thing!

Thanks for that tip to track everybody’s talents and skills — we could formalize that into a referral network page and maybe identify the talent “holes” and use those to help us find additional carnies for our team!

Happy Carnival, Ms. Annie! You’ve done it again.
Tea Silvestre recently posted..Nominate Your Favorite Tastiest Small Business Brands

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Annie January 25, 2012 at 10:16 pm

Thanks again for getting this thing started – geez, was it really less than six months ago?? And yeah that’s the same scene that pops into MY mind when I think about the multi-party barter!

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Nicole Fende January 25, 2012 at 9:28 pm

Annie I love the point about gaining a service and a client when you barter. Major light bulb for me! While I’ve always been a huge promoter of barter, that perspective never entered my mind. Yet another reason I will continue to promote this great option. Thanks!
Nicole Fende recently posted..Is Your Biz Cash Low? Use Bartering to Grow!

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Annie January 25, 2012 at 10:17 pm

Y’know, this is one of the main reasons I love Carnival days – ’cause even when it’s a subject we all agree on (bartering is good, make sure you’re clear on the expectations, etc.) I always find a new perspective I hadn’t considered before! Glad I could provide that for you, you financial genius, you.

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Eugene January 25, 2012 at 10:45 pm

The point about the added layer of value through gaining a client is absolutely awesome. When you’re just starting out it can be difficult to get the first couple of clients. This way you can not only get a client and get something of value in return (albeit non-monetary), but you can also get some testimonials…making it easier to obtain paying clients in the future.
Eugene recently posted..Selling by Putting Your Faults on Display: A Mini Case Study

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Annie January 26, 2012 at 5:08 pm

When that thought finally clicked for me, Eugene, I swear it was like the heavens opened and the choir started belting out some Handel up there… because that is THE big problem I constantly hear from all kinds of new ‘preneurs: “I don’t have any CLIENTS! How am I supposed to get testimonials and word of mouth??” BARTER, baby. Soooo many problems solved at once.

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evan austin January 25, 2012 at 11:39 pm

What do they call that when your whole body blushes? Flush? Anyways, i just did that.

Of course you already know Annie’s a gem, so i was GIDDY that i actually had/did something of value that we could trade with. (Ball’s in my court with my marketing story, btw: she gave me LOTS of weighty things to consider).

LOVE the part about the added human value and how you both get a client. New tip for me was to keep track of who’s good at what. Excellent!
evan austin recently posted..Barter Smarter: Opportunities & Cautions

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Annie January 26, 2012 at 5:07 pm

Aw, now I’m blushing. Flushing. Whatever (OK that makes me think of the bathroom … yes, I’m apparently an 8 year old boy.)

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Michelle Church January 25, 2012 at 11:43 pm

I love your writing Annie! Ok…you gave me another great tip…Keep a record of who’s good at what for bartering…I need to really do that for everything…but for this new adventure of bartering I have in the back of my mind, I am definitely going to start my expert list..especially if I decide to do it through an exchange…wow the contacts that can come from that..ok overwhelm again! :)!
Michelle Church recently posted..Bartering Increases Business Opportunities

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Annie January 26, 2012 at 5:05 pm

Thanks Michelle! That’s a new thought for me – I’ve been talking about doing it for a few weeks, and am still kind of playing around with the best way to keep and maintain that kind of info … yes, it can be overwhelming if you think about the big picture! Just little bites at a time. 🙂

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Nick Armstrong January 26, 2012 at 12:53 am

I’m beginning to think there should be some sort of Freelancer Knowledge Exchange – where everything we know about being small business owners is distributed to everyone else.

Your story and mine are remarkably similar; there’s nothing wrong with that, but I’m glad to see that I’m not the only one who respects barterers almost more than the folks I hire outright.

I think there’s another take to the whole barter side – what to do when things are so inequitable that the barter just wasn’t worthwhile in the first place. I haven’t seen that story told.
Nick Armstrong recently posted..The Flip-side of Bartering

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Annie January 26, 2012 at 5:06 pm

I think a few Carnies wrote about problems in the bartering exchange, though maybe not flat-out failure … you’re right, that would be an interesting take.

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Someone January 27, 2012 at 7:29 pm

I think this is a great idea. When it comes to doing a job for someone in exchange for them doing something for you, both people benefit in two ways. Getting what they each need, and getting experience. Is it weird that I check this site for new posts daily, then growl at the screen when there isn’t one? I think you should write a book filled with business and productivity tips, I’ve learned a lot from your site.

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Annie January 27, 2012 at 7:42 pm

Someone, you have made my day — nay, my week — especially in this purpose. Literally, I squeed at the screen when I read your comment. Have you *heard* me squee? It ain’t pretty. It seems silly on a 5’10” woman of a certain age – let’s leave it at that. Please come back. There will be more posts. And more frequent ones, too.

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Someone January 27, 2012 at 7:47 pm

Good! I just want to say, I like how you reply to every comment. It’s nice to know you actually care about the comments and readers.

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Annie January 27, 2012 at 8:12 pm

Aw, shucks. Now I’m blushing. 😀 Well, I do care – everybody who blogs or runs their own biz should care, too. A conversation – that’s what all the experts call it, right? Even me. But it can’t be a conversation if it’s all one-way. That’s why I love hanging out in the comments. That, and y’all are awesome, every single one of you.

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SandyMc January 28, 2012 at 1:26 am

This whole thread just made me smile Annie. So much evidence of the ‘spirit’ of barter.

Had a ping moment when I read the line: “When you barter, you add another layer of value to the transaction.” Layers of value speaks of enrichment and opportunity in a way that a single I do, you pay, or you do, I pay transaction seems to lack (although, how we service ‘the do’, can add a layer of value too). Still your sentiment just opened a whole lot of doors in my thinking. Thanks Annie. And I concur with Michelle, love the way you write.

The freelance resigister is a grand idea too…
SandyMc recently posted..Master barter and become a key person of influence

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Annie January 30, 2012 at 4:38 pm

Merci beaucoup, SandyMc! I do appreciate your comments, and your posts. It hadn’t really occurred to me before – that thing that always made me view barter transactions with a special added bit of glee – until I sat down to write this post and realized that whole value-added thing. Especially for new entrepreneurs, whom I adore anyways.

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