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Thanks
All I did was plug in the data you provided.
"bartering" goes in the exact phrase.
"accounting services, lawyer services, advertising space, hotel stays," with all the words using Google.
The link I posted was the first one on the results page.
Oooo. Google: Not just for checking serps. ;)
Online classifieds might be a good place to search, too.
I love barter and I have done A LOT of it over the years. If you are going to do this here is some information I have picked up over the years.
First, a few concepts. There are two main types of barter. Trades done through exchanges and direct barter. I have done both extensively.
By far the easiest and quickest way is using trade exchanges. You may have one or more trade exchanges in your area. I live in a medium sized city and I have two exchanges locally and a couple more about an hour up the highway in a bigger city. You will probably find them in the phone book under barter or trade exchanges.
A trade exchange works like a bank and a marketing agency all wrapped up in one. You join an exchange where members buy goods and services from each other in "script" also called trade dollars. For all intensive purposes these trade dollars are like real dollars accept they can only be spent within the exchange. The way it works is the exchange promotes your services. Another member comes along and hires you. You charge that member the same prices you would in cash accept they pay you in script instead of cash. The trade exchange facilitates the exchange by moving the script from their account to your account when the trade is complete. You then pay the exchange a 10% cash commission on the deal for this service. You are then able to spend your script with other members in the exchange the same way. Each month you will get a statement of your balance in script and the expenditures you made. The mechanics are pretty easy to use.
The down side is that you may end up doing business with people who are less then honorable. You have to pay attention. Before hiring anyone in the network I would check references, check on them at the Better Business Bureau and get a couple of cash estimates from people outside the network to get the fair market value of the traded service. By doing this you will make sure you are dealing with an honorable person and paying a fair price even if you are using script. Just because you are using script doesn't mean you should pay more then you would if you were using cash.
Good trade exchanges police this stuff and throw out bad members and people who overcharge because the service is for trade dollars and not cash. Bad exchanges don't care so do some background work on the exchange before joining as well. Also be sure you keep receipts of trades, statements, and good records as I have found the exchanges bookkeeping to be a little sloppy.
The other down side is they have to report earnings to the IRS at the end of the year. The script you earn is just like real taxable cash to the IRS. So be careful that you are putting aside cash from your cash jobs to cover the taxes for the trade dollars you are earning. I personally manage my trade business through the exchange by making barter approx. 1/3 of my overall earnings. This way I can use the 2/3 cash jobs to pay taxes, sales commissions and the things I can't pay for with script like gas, mortgage, food, etc.
One more thing about exchanges is that many of them belong to the national or even international trade exchanges so you can end up trading with people outside of your local exchange. Generally this is for hotel rooms, but it could be other things. If you join a local exchange ask about this and they will explain it to you.
However despite those downsides you can't beat a trade exchange in terms of ease of use for barter transactions.
The other way to do this is doing a direct barter with someone. You basically trade them service for sevice directly with no exchange between you. I have done this as well with mixed results. It is harder to put trades together because of differing values. For example your site may be worth a lot more then the accounting services you want to trade for. You can make up the values in two ways. First you can do a trade in part trade part cash. I have done this many times with a great amount of success. They get a good deal because their out of pocket cash expenditure is less then if if they paid all cash and you get a the full value of your services without taking on extra trade stuff you can't use or don't want.
For example, I had a body shop who wanted a site. They asked if I would trade them. I said my cars were fine and I didn't need any work done at that time. However I remembered my wife's car had a cracked windshield that I had not got around to fixing. I said I would trade that for $200 towards their site and the rest in cash. They were hoping for more, but they still got a good deal. I got cash for part of my work and my wife's car repaired. We all won. Using part trade and part cash is referred to as using "boot" you basically set up a trade and the agree to throw in "boot" which is the cash portion.
I have also done it the other way where I wanted some sales training that this school charged $6,900 for. I agreed to pay them $1,000 down $1,000 over the next year with no interest and the balance in a small static web site. They agreed we all got what we wanted.
With direct barter you can also do what they call "horse trading" to make yourself better off. This is where you are performing multiple trades always increasing the value of your position. For example, I have a client of mine I have done cash business with for years. However he wanted a web site and wanted to know if we could work out a trade for it. The problem was that I couldn't think of anything they had that I wanted. Until I remembered that the owner also did a radio show. I agreed to do the entire site in trade for advertising time on his show. They got a web site and got hours of radio ad time. I traded part of my ad time to a computer shop for hardware and software I needed. I then sold some of the software to another person as part of a cash job. I normally would have had to pay part of that cash contract out in merchandise, but in this case those extra cash fees were mine because I had the software already, which I got through the trade above. I used some of the radio time to promote a seminar I was doing and I also traded some more of it to an accountant to set up an S-Corp for me. Not bad for starting out with a bunch of radio advertising time.
The key to doing great "horse trading" is to understand the value of all your trades, constantly be looking two or three trades ahead and seeing the whole picture of how this will play out. Being creative is obviously an advantage. You may also be taking inventory of items in a trade that you can't trade right away, but can trade later for stuff you want.
I personally keep a large database of potential trading partners, items they are looking for, and things I have in inventory. I have taken a concept that is 5,000 plus years old and moved it into the digital age.
If you want to do direct trades you need to know who you are doing business with and make sure you can trust them to fulfill their end of the agreement because you have little or no recourse if they don't. You also need to know the value of stuff and if you plan on horse trading make sure you know people you can get rid of stuff to for other things you want.
On either kind of trade either through an exchange or direct barter make sure you write down the exact trade and have both parties sign it so there is no misunderstanding about who gets what. In both situations I still use my standard contracts and terms I just modify the agreement to reflect trades instead of cash. I spell out the entire scope of the project, who is responsible for what, and terms of delivery and payment. It helps keep everybody on the straight and narrow.
I would also recommend you start out with small trades first until you decide if you like it and are good at it. Bartering is as much art as science and not everyone is cut out for it.
If you are interested in learning more here are some great books on the topic. They are all dated and written well before the Internet age, but the concepts are timeless. They will discuss all the terms, using exchanges, script, horse trading ect. They are all out of print so you will have to hunt them down through Amazon used books or on eBay.
1. Smarter Barter
2. The Barter Book
3. Let's Try Barter (1976 edition)
In the Smarter Barter book the author shares stats that some 1 billion in trades occur annually around the globe. That book was written in 1986 so with the Internet and the time that has gone by I wonder how much more is traded now.
I have never used an online trading exchange although I know they exist. I don't think I would like doing it that way as I have less then no recourse if something goes wrong. At least with a direct barter or an exchange I have someone's throat I can get my hands around if something goes really wrong.
Good luck,
Fortune Hunter
