Small businesses: barter to stretch your budget

When the economy is low, barter seems to gain popularity. The process of a cashless transaction can help and expand the budgets of small business owners. No matter what condition the economy is in, bartering is a very healthy part of my budget. There are good points for bartering, but they are completed with a warning.

One on one or through a commercial organization.

You can exchange one by one if you can find someone who wants what you have and you want what they have (the doctor wanted chicken for dinner and your sore throat healed). For example, I provided inventory as a uniform exchange for SEO work for our website. She wanted the inventory and I wanted to improve my position with the search engines. Each had something that the other needed / wanted.

Trading through an organization is usually easier because you don't need to find someone who needs what you have to offer. I have bought family photos, restaurant gift certificates, acupuncture treatments, haircuts, eye exams and glasses, gardening service ... the list is quite long. Instead of having to find a restaurant, salon, or landscaping company that needed my inventory service, I hired them and paid them with my "barter money." The barter organization provides all banking services, so your transaction is like that of a cash bank. The only difference is that it is only a paper withdrawal and a paper deposit in the account of the other company. When a member of this barter organization wants an inventory, and I don't need their product or service, that's not a problem. The withdrawal comes out of your account and the paper deposit is placed in mine.

I balance my account statement each month as do my bank statements. Of course, in accordance with IRS requirements, I record all income and expenses just like I do cash transactions. In fact, I have it in my accounting software like a bank account, so all accounts are properly debited and credited.

Good points.

First, Barter preserves your cash. If you need to buy advertising, for example, that can cut a large part of your marketing budget. But if you can keep your cash and change advertising, you've just traded a cashless transaction in advertising that is likely to bring you cash deals.

Sometimes people buy services (window washing, painting, landscaping) that they would not consider paying for in cash, but will happily and easily buy through barter. You have just received clients that you otherwise would not have received.

These barter clients can then provide references that might not be other barter clients. A family member or neighbor could easily become a cash paying customer! Again, bartering only helped find clients you may not have received before.