Tag Archive for cashless

Think barter, grow richer!

Originally on http://kofiboahen.com/?p=41

Bartering is fast becoming an increasingly popular business growth strategy. The U.S. Department of Commerce estimates that 20% to 25% of world trade is now done in barter. Corporate barter is now a 20 billion dollar industry (corporate barter is only one type of barter). Everyone from business corporations on the New York Stock Exchange to small home – based businesses are jumping on the barter bandwagon.
Judging from all the emails I received from my previous barter article (if you missed it, you can read it on my blog, quantumprofits.blogspot.com). I intend to really delve into specific barter strategies that companies can easily replicate to lower their expenses and by default boost their profits. These strategies I will be discussing are highly valuable in the sense that they are very practical and more importantly if they are applied properly, companies can rake in millions of Cedis in profits depending on the size of the company’s operations.I have not only discussed the issues but I have included real – life cases of companies practising these barter strategies and profiting immensely from it. My idea is to show you that these strategies really work and that your company can and should also take advantage of these opportunities.

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1) Save cash on capital and operating expenditures
With the right barter system incorporated in your company’s marketing and procurement strategy, your company can save large sums of money. Once your company has clearly identified the capital items needed, be it computers or cars; the company can then contact a competent Barter consultant (BC) to help identify the appropriate swap partners and to ensure a smooth transfer. It usually becomes very necessary to use the services of a BC if the swap is not direct. The BC will usually introduce other parties into the transaction to ensure that the deal goes through smoothly. In the same vein, barter can be adopted in financing operating expenditures at huge discounts. Once the company identifies all key operating cost centres such as internet expenses, telephone charges, fuel charges etc. The company then works with the BC to identify companies who provide such services. The BC will then have the responsibility of ensuring that your company receives what it needs without necessarily paying cash. To do this, the BC will also have to satisfy the supplying company, sometimes this requires the introduction of a third party who wants your products and has what the supplying company needs. To illustrate, recently a client of mine (a major player in the media industry) financed large portions of its capital items including cars and computers and also key operating expenses such as yearly internet services as well as end of year employee gifts (flat screen TVs) through barter. The company thus saves millions of Ghana Cedis by adopting this system of business.

2) Vastly expand your available advertising budget without any cash
An international air courier company in competition with Federal Express hired a barter firm to help finance its entire advertising campaign. The barter firm secured the advertising for the company and paid not with cash but in air courier credits. The barter firm’s job in this case was to convert the credits into cash (only to new non – existing clients) for onward payment to the media house. In the end, the courier company enjoyed its advertising up front, kept its cash reserves intact and more importantly lots of the cash conversion barter sales (some of which were Fortune 400 companies) have continued to use the air courier on a full–cash–paying basis long after their barter credits were used up. So far, in the eight years since the original trade was done, nearly 24 million worth of resulting “cash continuation” business has occurred as a lucrative “by – product” of the initial one – time barter transaction.
Whiles this example is foreign, it is entirely practical in Ghana. For instance in the last couple of months, my company (QuantumProfits Consult) helped negotiate a barter advertising deal worth over GH 80,000 carried out by a major furniture outlet across different media without a cedi changing hands. Apart from the company enjoying increased business, brand awareness and recognition from the advertising campaign, it has also enjoyed lots of referral business from the customers who bought the bartered goods from us thus leading to huge residual benefits for the company.

3) Finance rapid growth without cash
Carnival Cruise Lines, a Florida based cruise line, which is now one of the largest cruise lines in the world started with a single ship and very little operating capital. The company through its barter agency traded empty cabins for radio, television and newspaper advertising in 100 cities over a ten-year period. The underlying philosophy was very sound. First, the cost of an empty cabin once the ship sails is minimal. Second, the passengers usually spend considerable cash in the bar, casino, gift shop and shore excursions, thus the net cost to the cruise line to fill an empty cabin was literally zero. Stated differently, they made massive profits off the bartered cabins being occupied instead of going out empty.
The strategy yielded huge dividends; they used the technique to become one of the largest cruise lines in the world and continuously advertised in 100 cities for more than 10 years without ever paying cash. More importantly the company generated over a $100,000,000 in revenue. The owner of the cruise line is now on the Forbes billionaire list. It all started with one thirty year old ship and heavy barter advertising.
This strategy is very practical for companies within the hospitality and airline industries which have very perishable services. With the right barter strategy in place, such companies can advertise very heavily to raise more revenue during the yuletide period as well as create a strong brand in the long term. For hotels in particular who usually shun advertising as a result of revenue difficulties, barter is a wonderful option. This is because, apart from the fact that they can now get the all the advertising they want without paying in cash, people who purchase the barter credits still have to buy food from the restaurant as well as pay for other services the hotel offers, hence generating more revenue for the hotel.

4) Continuously generate a steady stream of profit at far above close – out prices
A major Japanese auto manufacturer had 1,000 cars that were in the U.S. that they had been unable to sell. With the help of a barter agency, the company bartered the cars to radio and television stations in selected markets at full retail prices. The advertising credits was used to introduce a new sports car that become a runaway success but which the company could not afford to previously run advertisements for.
The bottom line, the cars were sold at full retail prices and millions were saved on the advertising schedule and the introduction of the new sports car became the basis of a blockbuster success for the auto manufacturer due to continuous brand awareness and visibility as a result to the advertising credits it acquired solely on trade.
This barter strategy is also very practical for manufacturing concerns as well as importing companies, who may usually have a need to move out old stock to make way for new stock or new models. Rather than sell at heavily discounted prices which can create holes in the company’s account statements and create problems with stockholders, barter may be a smarter option which allows the company to sell at fair prices without affecting the company’s brand as well.

5) Employee and stockholder benefits
Many companies issue employee and stockholder benefits in barter either for the company itself or for other bartered goods or services they have acquired. Christmas presents, sales bonuses, customer inducements can all be given without using cash. For instance, most of my clients do not use cash in buying Christmas presents for their staff. My outfit is very busy now bartering from flat screen TVs to hotel credits to be given to various employees for their wonderful service during the course of the year. Honestly, your company can and should be doing same.
Truth be told the barter strategy is no discriminator of businesses, as long as your company produces a product or a service that has value to a certain customer group, your company has what it takes to cash-in from incorporating barter in your marketing and procurement strategy.
After reading all these specific barter strategies and the accompanying examples, I’m sure you are wondering which strategy is right for your company. Well that’s the million dollar question. Finding out the best strategy for your company and implementing it properly could see your company slashing its cost down significantly and automatically improving profits. As I usually say, nothing substitutes for good professional advice. It is time to have a chat with a competent BC. The BC will help you find a good barter strategy as well as integrate it in your system with little difficulty so as not to completely upset your established organisational plan. Trust me, if you really want to get on the barter bandwagon, that’s the best advice you should heed to.

Yes, it is good to barter

Originally on http://www.barter-blog.com/

Karen Morath of FlyingSolo asks, “Is it good to barter?” and concludes that barter, or as she also calls it “contra deals”, isn’t worth the trouble. Here’s part of her reasoning:

But that’s nothing compared with having to tell your would-be accountant that he or she needs to work for three hours at their rate of $85 per hour as a trade for one hour of your time at $275 per hour.
I’d have to suggest that if you’re having a hard time convincing any customer, barter or cash, that your time is worth $275/hour perhaps it isn’t. On the other hand, if you’re selling out your time with none to spare at $275/hour cash, then she’s right – barter isn’t for you or at least not at the apparently undervalued price of $275/hour.

Barter is great for a number of reasons, including selling excess inventory (whether it’s a product or your own time and labor). If there is no excess inventory and for whatever reason you are satisfied charging a less than market clearing price, barter probably isn’t for you. On the other hand, if you can’t sell your time for $275/hr cash at least a good percentage of the time, barter isn’t the magic bullet that will allow you to get a more than market price. What it can do is create a win-win situation where another business that will need your product/service will get it from you rather than another similarly priced provider.

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And then there are products, another complicating factor. If you seek to exchange your products for someone else’s services or your services for someone else’s products, should the product price be at retail or wholesale or cost?
This is a little tougher, but again no reason to avoid bartering altogether. Gnerally speaking, if one party wants to price at retail, both should probably price at retail. But there are certainly situations where that isn’t appropriate. If, for example, you are in the wholesale business and are bartering a large lot of fairly low unit cost items (say 1,000 boxes of candy that retail for $2) and trying to purchase something where you are the retail consumer (say a new car), it may be appropriate to barter on a wholesale-to-retail basis. The points to consider are each parties end use and each parties business model. In other words, will your barter counterpart eat 1,000 boxes of candy himself or will he distribute them one at a time to consumers as giveaways at his car lot. If you want to dump 5,000 boxes of candy that are a month from their sell-by date, you may even barter below cost. In that situation, any return will beat throwing them away, especially if your car dealer’s giveaway puts your name in front of the public, too.

Whether it’s a service or product, barter is more complex than simply calling a toll free number and giving them your credit card number. Indeed, that’s why most transactions aren’t barter. Currency is one of the great inventions of modern humans and a giant leap forward over having to barter in every single transaction. That’s one reason most barter experts recommend limiting barter to a fraction, usually around 10-20%, of total sales. Barter can’t and shouldn’t be expected to replace cash transactions, but it’s still a great way to turn excess inventory into cost savings. Handling the, relatively minor, complexities of pricing and negotiation and the somewhat more complicated problem of matching needs is just one way that the smarter business owner will compete with those who avoid barter. The question is whether the business owner who’s afraid or unwilling to compete in this playing field will do much better in others.

Tight Budget? Barter!

Originally on http://dangerouslee.biz/2011/12/12/tight-budget-barter/

As much as solo parents face emotional problems dealing with the absence of Dad (or Mom, if the solo parent is a widowed or custodial father), not all problems that challenge solo parents are of the interpersonal variety. Some are practical…like the shortage of funds that is frequently more severe in a one-parent family.

These days it seems that everyone is feeling the pinch…but, as usual, the problem tends to be more severe when there is only one wage-earner, and especially when she needs to also pay for child care while she’s out earning those precious dollars. But even if your kids are old enough that you don’t need daycare or after-school care for them, money is likely still an issue.

An old-fashioned approach to this problem still is very valid in today’s society: barter. And it solves not only financial issues but other issues as well, such as a shortage of time or talents.

Shortage of time? Yes. Suppose you feel you don’t have the time to clean the house thoroughly every week and work 9-to-5 and help the kids with their homework and cook nutritious meals and balance the checkbook and pay the bills and spend at least a little quality time with the kids…never even mind having some “me-time” just for yourself? What if you could get someone to clean the house for you? Or cook dinners? Again, money figures into the equation: Most any service is available for those well-heeled enough to pay for it, but you may not be related to Donald Trump or have access to Warren Buffet’s wallet.

You can barter for the services you need. Is there something you can do, create, or otherwise trade for the services of someone who can in return clean the house or make dinners for you? Now, of course it’s likely to take some of your time to perform the service you’re trading, but maybe that will take place at a more convenient time for you. Maybe it’s not that you lack time altogether to do the task you’re looking for help with. Maybe you just don’t have time to make dinner when you first get home from work, if the kids are little and you want them to be in bed early, but you have time later in the evening during which you could do some sewing on your machine for a friend in trade for her delivering prepared home-cooked dinners for you five days a week. Or maybe your workday ends at 3 PM and you could watch the kids after school for another friend, along with your own kids, in trade for her cleaning your house thoroughly on Saturdays while you go out grocery-shopping and doing errands.

Shortage of talents? Yes. Maybe your problem isn’t a shortage of time so much as a lack of skills at sewing the kids’ clothes, painting the house, grooming the dog, or doing some other task. Again, these are skills that can be hired if you have ample money at your disposal, but these days few of us do, especially solo parents. So rather than strain the budget, botch the job doing it yourself, or go without, see if you can barter.

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Finding a bartering partner

How do you find a bartering partner? Start with the people you know. Who among your friends or acquaintances can create or repair those clothes, clean your house, install that new garbage disposal, paint your living room, groom your dog, or perform whatever other task you need? Be ready with an offer of your own in return: What can you offer to make or do for this other person? Have several suggestions in mind in case the first one is rejected. The person you tap to barter with may be amenable to a bartering arrangement in principle but not in need of the first thing you suggest trading for. If Sonja is willing to clean out your garage but doesn’t want an apple cake every week for four weeks in return, what else can you offer her in trade? Can you tutor her son in math? Can you help her write her résumé if she’s seeking a better job?

If none of your friends or acquaintances is interested in bartering or is able to provide the specific service you need, enlarge your scope. Try advertising on CraigsList, on a community bulletin board (literal or online), using word of mouth (asking friends and acquaintances whom they know who might be able to provide the needed service), or you might even consider setting up a barter exchange organization in your community and becoming your own first client.

Too, if the service you want to have performed for you is something that might be performed by a business owned by a sole proprietor, try approaching the business owner with a bartering proposition. If a company is a Megacorp-type with a board of directors and stockholders (public or privately held), forget about it. But remember, some corporations and LLCs are simply legal protection sheltering a sole owner or, perhaps, a pair of partners or a mom-and-pop operation. So don’t let the fact that Pete’s Plumbing is owned by Plumbing Specialists, Inc. dissuade you from making your proposition to them. The sole stockowners in Plumbing Specialists, Inc. might be Pete and his partner or Pete and his wife…or just Pete himself.

In this tight economy, Pete’s Plumbing, Housepainters Deluxe, and various other service providers are likely struggling to make their own ends meet, and while they’d love a cash-paying customer, if you can provide a service (or item) in return for their services, and it’s one they want or need, they may be very happy to be able to get it without a cash outlay. Can you design or write advertising materials for them, clean their offices, write a commercial jingle, or provide any other service for their business (or possibly for their home), in return for their doing some work for you?

I have heard from more than one person whose father was a doctor in “the old days” and accepted chickens or slabs of bacon in payment for their fees. While it’s rare anymore to find a physician who’ll barter his or her professional service for other services, let alone for food, many other types of service providers may be agreeable to that kind of arrangement.

You never know till you try.

Bartering—it’s an idea from the past whose time has come again, and it can be a particular boon to the solo parent with just one household income and one set of skills (yours) in the home. Try it.

Bartering in order to save money

Originally on: http://blog.dollardays.com/bartering-in-order-to-save-money/

In these difficult economic times, people are looking to save money in a variety of ways. One of the best ways to live frugally is to barter for goods and services whenever possible. Bartering is the act of exchanging goods and services without using money.

During the Great Depression in the 1930?s, bartering was common. Many people would pay their doctor’s bills with eggs and milk from the family chickens or cows. Other people paid their bills in produce. For a time, bartering fell out of popularity. However, the practice is making a comeback. How would you barter with someone for goods and services? For example, you may want to have your lawn cut, but you cannot cut it yourself. You may also not have the money to pay someone to cut it either. In such a case, you might think about trading services in exchange for having your lawn cut. Perhaps you would be willing to make and decorate a cake instead of paying money. In this case, the cake is what you are willing to barter.

If you have a tight-knit community or a support network of family and friends, you may not have any problem-finding people with whom to barter. In fact, you may have already been bartering and not actually known it! If you do not have a support network or if you do not live in a tight knit community, it may be more difficult to find people who are willing to barter with you. However, it can be done.

One of the best ways to find people willing to barter is to search online. There are actually many different bartering forums that exist in order to help introduce people to each other and to educate people about the practice. One such site is called SwapAce. Here, you can trade goods and services, learn more about bartering, and learn how to improve your negotiating skills. Another way to find people willing to barter with you is to advertise on Craigslist or other similar sites. If you own your own business and want to barter with other businesses for goods and services, you may want to join a group like ITEX. Bartering for services can actually help you to get your business up and running without using a lot of capital.

Of course, it is important to mention that you should take precautions and be careful when joining any online group or participating in a group online. Before joining the group, it is important to read over the rules and to obey them.

Although it may take you some time to find a person will to barter for goods and services, most people who barter say that the effort and time is well worth it. Take some time to look into bartering and join the ranks of those who enjoy living frugally.

How to Save Money by Bartering

Originally posted by Sequoia on http://www.favstocks.com/how-to-save-money-by-bartering/0316204/


How to Save Money by Bartering

Something people generally do not think about is that they can save money with bartering. By exchanging services with a friend or relative rather than paying a stranger or a business, both you and the person you are bartering with get something you need without spending as much, if any, money.

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Think about what you have to Offer
What do you do for a living? What are your hobbies and other areas of expertise? For instance, if you are a web designer but aren’t that great with graphics, you could easily offer web design services in exchange for graphic work on the same project. The graphic designer gets work and exposure. You get work and exposure. It saves you money and puts the project in the hands of someone you can trust.

Think about What You Need
What services or products do you need? This will greatly affect who you can potentially barter with and how you can accomplish the barter. If you need work done on your house, you could offer your web design services to help the person who works on your home to get more business.

Depending on what you have to offer and what you need, you may find it harder to barter, but you can advertise in various places online and in person to help you get it done.

Bartering Vs. Haggling – What’s the Difference?

Posted on May 13th, 2010

http://thesmarterwallet.com/2010/bartering-haggling-less-money

Bartering is an age old skill that we could all make use of a bit more these days. Once you consciously think about bartering, you end up using it a lot more. And – the more you use it, the better you get at it.

Bartering vs Haggling: How To Get Things For Less Money

Bartering is very simple because you don’t have to worry about money. This makes it a good tool because you know you can still do certain things without needing cash all the time.

But it’s important to recognize the difference between bartering and haggling. Some people think they are one and the same thing but they’re not. Haggling is the art of negotiating for a better price, whereas bartering is a form of trade. Both are ways to get things for less money, but achieved through different methods. Haggling requires a confidence you don’t yet have. Bartering means that you have on hand something that the other person wants as well though, otherwise the whole thing doesn’t work.

Bartering means to swap something you don’t want with another person. Skills and goods both work, and once you get better at it you will hopefully save even more money each month. And at the same time you can help out some other people in the process. What could be better?

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Bartering when starting a Business

Posted on April 26th, 2010

http://www.aboutcabinets.net/blog/benefits-of-starting-a-cabinet-business/

If you are running a business or thinking of starting a business, there are great opportunities to make your venture a profitable and lucrative one. The thing is that it’s not only you you will be facing the economic crises; it is everyone around you going through the same problems. In these times, what you can do to make your business grow without spending more money is by bartering services and goods and establishing good relations with other businesses and professionals.

Below a few tips and suggestions on how you can use your cabinet services to your advantage and spread your business without spending money or going out of your way!

  • Approach accountants for your business as they can help you greatly with your books and accounts. In turn offer your services to individual accountants or their company and help them if they need any jobs done. This will not only help you in your business but also help you to show them what you can do and ask for referral jobs too.
  • You can also approach attorneys or lawyers and ask them to trade out expenses in a barter exchange.
  • The same goes for physicians and other medical practitioners, you can approach them in barter of your services and do a fabulous job for them. This makes starting business worthwhile as no matter how the economic conditions are, you will be able to carry on your business forward and make a name for yourself with good services and a neat job.
  • Approaching auto mechanics is another great way to bartering your services and getting your car repaired at the same time. All these things will help to get the word about your business out as business can only progress if people see what good you sell.

Bartering and its Basics

Posted on April 3rd, 2010
Originally posted by Cherryl Hanson Simps0n

http://www.hellomails.com/blog/?p=7403

Our current economic system has socialized us to exchange a form of money – whether cash or credit – to receive goods and services. Unfortunately, whenever we run short of this precious monetary commodity, we’re unable to obtain the things that we need or want.

In these times when finding extra cash is definitely challenging, we have to become creative if we want to maintain our standard of living. There really is no shortage of the items that we need in the marketplace; the problem lies with our inadequate supply of money to pay for them. What if there was another way to get products and services without having to spend money?

In olden times before a system of monetary exchange evolved, people were able to acquire the things they needed to survive, by exchanging an item they already had with other people’s goods. So a chicken farmer could supply eggs in return for milk from a farmer who raised cows. Bartering occurs when two parties swap goods or services without any monetary payment being received.

Is it possible to go back to the basics of the bartering process in these modern times? Definitely! While we will never fully replace the need for money, bartering in different forms can help us to spend less and still achieve our desired lifestyle.

Here are some ways we can implement bartering to our benefit:

Trading Your Skills

Many of us have talents and skills that are in demand; but most of us have never figured out how to market our abilities to profit from them. Bartering can help us to trade our talents and receive the benefit of someone else’s skills in return. The idea is to exchange services or products that would normally have similar monetary value; and it works best when it costs only a little time and effort.

There are countless ways that you can use this principle. If you’re a math teacher, you could offer to tutor your gardener’s child in exchange for landscaping services. If you’re a tailor, you could sew clothes for your barber in exchange for haircuts for your family. If you have a marketable skill, write down all the services you would like to have, and simply ask around until you find someone who is willing to barter for what you have to offer. What do you have to lose?

Everyday Bartering

Even if you don’t have a particular talent or skill that can be traded, you can use your imagination to find things to barter. Remember that everyone has requirements that may be difficult to meet due to money shortages. To be successful at bartering, you have to be perceptive of people’s needs and be willing to do tasks that can make their lives more comfortable or convenient.

Here are a few ideas where ‘one hand can scratch another’s back’:

  • You need gas for your car, your friend needs transportation – Your friend can buy enough petrol for the week in exchange for your driving services;
  • You need a break from your kids, your friend needs to use the internet – Your friend can supply babysitting services on the weekend in return for access to your computer on weekdays;
  • You are tired of cooking on Sundays, so are all your friends – You can arrange dinner parties where the preparation and location of the meal is rotated among friends every week.

For everyday bartering to be successful, each person must have a very clear concept of what is required by the other party, and must be dependable and timely in carrying out the agreed tasks.

Bartering and its Benefits

Posted on April 1st, 2010
Originally posted by Donald Robichaud

http://www.castanet.net/news/Build-your-Business-Donald-Robichaud/53633/Barter-your-way-to-sales-success

As we start to pull ourselves out of this economy it’s important to understand how the art of bartering can assist us to improve sales, profits and allow us to close more business.  As a business owner you can barter to purchase what you need or want, and pay for them with the additional sales of your goods or services.

Bartering helps improve cash flow as it allows you to pay for what you need with your own goods or services, allowing you to preserve working capital for other expenses.  When you use barter, instead of cash, to purchase needed goods and services, you reduce your cash costs by paying for them with revenue generated by incremental barter sales. This means that new sales are made by bartering which help reduce cash outlays for overhead costs. Obtaining these overhead services through barter rather than writing out a cheque saves you cash.

Bartering can also allow you to move excess inventory and improve inventory management by converting excess products into valuable goods and services. If you barter, you avoid having to liquidate excess inventory through drastic discounting.

So the art of bartering and negotiating can help companies enhance productivity and put inventory, equipment and employees to good use, creating new revenue that would not have been available otherwise. That new revenue can be used to finance the purchase of new equipment, raw materials or services to support the business. Essentially, a company can move less productive assets and exchange them for more valuable goods or services through the help of a barter exchange.

Bartering benefits your company and your clients with a mutual benefit in exchanging goods and services rather than cash, and it also enables those who are lacking hard currency to obtain your goods and services.