As self-employed business owners continue to look for ways to grow, many are taking a fresh look at barter as an opportunity to use downtime, get rid of excess inventory, fulfill operational needs, expand their reach and grow their businesses—all while conserving cash flow.
It can then use those trade dollars to “purchase” goods or services…
In economic downturns, self-employed entrepreneurs have less cash to spend — making barter’s cashless system of trading goods and services especially appealing. And it’s easy to get started. A business lists a good or service for trade through a barter exchange like IMS or ITEX.
In return, the business receives a trade credit based on the dollar value of the good or service offered. It can then use those trade dollars to “purchase” goods or services offered by other members. It’s a simple exchange, but as a result, businesses access a rich, varied network of actively bartering members.
Trade dollars can be used for an endless number of goods and services, including advertising, accounting, office supplies and equipment, renovations, printing, employee and corporate gifts, restaurant meals and more.
Barter’s benefits extend beyond conserving cash; it’s also a valuable business strategy for increasing sales. Barter exchanges bring new buyers and sellers together, creating a potential new customer base for business owners. By heightening the visibility of their products or services to potential customers, many companies in turn see an increase in their cash-paying customers.
Companies using barter also turn what otherwise would be worthless capacity into a tool they can use to their advantage. After all, most businesses have excess capacity. A professional person has empty time slots. Hotels or airlines have empty rooms or seats. Restaurants have empty tables they can’t fill. Retail stores have unsold seasonal or discontinued merchandise. Time-critical situations are a great use of trade dollars. As time passes, excess capacity too often evaporates into thin air. But businesses in barter networks can barter away that capacity and generate trade dollars they can use for other needs.
Barter leverage allows companies to generate new business, conserve cash and convert excess inventory and capacity into needed goods and services—providing companies with a distinct advantage, particularly in a sluggish economy. Bartering may sound like a different way of doing business, but self employed business owners are embracing it as a valuable addition to their business models.
John Strabley is president of New Berlin, Wisconsin-based IMS-International Monetary Systems, one of the country’s leading barter organizations.