| Steve’s Rules of Barter |
My rule of barter is that I look at the product or service being offered and decide whether it is something that I would buy if there was no barter involved. If I wouldn’t then the fact that I am getting work that is being paid for on a barter basis makes a highly unattractive proposition. When I was running my computer service company, one of our clients was the New York Giants football team. They bought about $120,000 worth of computer equipment from us and then suggested that they should pay through barter, the payment being in the form of an advertisement on the Giant Diamond Screen. My ego was engaged and I thought about it for a millisecond, but it was not something that I would ever even remotely consider buying at arms length. And I needed the money anyway! This was when Dan Reeves was head coach, and I got him as a keynote for the trade association for which I was a director. He needed some computer equipment and we were able to pay his fee on a barter basis, which obviously reduced our cost by the amount of our margin, making it an attractive deal from both sides. There are barter agencies which are worth exploring if you have a product or service that has wide appeal (for example, a limo service, a dry cleaner, an IT service company, etc.). The way that they work is that you get a credit for every service that you provide which you can then use to buy services from other people in the exchange. Obviously, my golden rule still applies, and you have to look carefully at the members of the exchange and identify whether they have products or services that you would buy on an arms length basis.
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