Bartering Business: Bartering Services or Products

“Bartering.” The word just doesn’t sound professional, does it? In fact, the first time bartering was suggested to me a few years ago, I dismissed it pretty quickly.

Then, one day I went on a call to a prospective client. He needed to write the manuals and tutorials for a product developed through a recent contract but was too busy to do it, not to mention the fact that he really didn’t like technical writing. In passing, he showed me a lead tracking program that he and his associates had developed because they felt nothing on the market adequately addressed their needs.

I went back to my office thinking about how much I needed to charge for the work we had discussed. I couldn’t get his lead tracking program out of my mind. It did just about everything I wanted save a few tasks specific to my preferences and line of work. I also had that nagging feeling that my prospect wouldn’t be able to pay the full rate since he was a very small business himself.

So, as you might have guessed by now, I built that lead tracking system into my proposed budget – not the executable, but the code (I wanted to tailor the program to my needs). After a bit of going back and forth about time-frames, deliverables, and, of course, cost, we settled on what we both perceived as a fair amount for the project: $X in cash plus the code for the program for a total value of $Y. I was happy. He was happy… so happy that he now wants to take me along on some of his initial meetings with potential clients to show that extra edge gained by producing readable manuals.

Unfortunately, in order to maintain a positive cash flow, you can’t barter your services to anybody for anything. But, if someone’s got something you want or if you’re just starting out, especially if you haven’t taken the full-time plunge yet, bartering offers a way to establish or build on your reputation. You’ll also be developing your client list which may lead to referrals or repeat business.

Finding others that would be willing to barter their services or products can be difficult. Barter Systems, Inc., in Silver Spring, Maryland, serves as a matchmaker. They maintain a database of over 1000 companies and individuals that provide a wide array of services. When someone in that database needs the services you provide, they negotiate a “cash” price with you. That amount is credited to your account. Then, if you need an advertising campaign, you will negotiate with one of the ad agencies for a “cash” amount, which is debited from your account. Barter Systems takes a 6% cash commission (U.S. dollars, not Monopoly money) on the negotiated amount from both the buyer and the seller since they don’t charge a fee to join.

Most of the business in these barter networks is for office equipment suppliers, restaurants, accountants, lawyers, and marketing consultants. According to Barter Systems, there isn’t much demand for computer programmers, although computer resellers and some PC network integrators might be able to find some clients through barter networks.

Therefore, as a computer consultant, perhaps the best way to think about bartering is to keep it as an option in your bag of negotiation tactics when you engage a potential client. Think about their products, facilities, and services. The results could benefit everyone involved.