By Bob Meyer

The key to your barter success (like most everything in life) is without exception your desire to make a commitment, and adopt a pro-active approach to using this unique financial tool.

Assuming that you’re committed to bringing greater profits to your bottomline, here’s a look at the basics of trade purchasing.

Steps For Understanding & Greater Profits


Although figures are often bantered about regarding the “true cost” to barter, the reality is that you should do your own math—because you know your operation better than anyone else!

It’s quite easy to ascertain your “barter cost” when you consider that your barter business is additional (incremental) business. When determining a “barter cost” you should consider only the direct costs you incur in selling your product or service on a trade basis.

Inasmuch as your everyday overhead costs are already covered by your regular cash business, whether or not you ever barter, they are not a part of your “barter cost.”

Once you determine your barter cost, everyone in your company responsible for purchasing should be advised of this cost. Because, while price might be the single determining factor when purchasing with cash, trade purchasing (keeping your “barter cost” in mind) will provide you with the lowest possible cost to the company.

In other words, while one cash dollar always costs your company one dollar, your “barter cost” (one trade dollar) costs your company less. And is determined by the cost of the goods sold, plus, if you’re bartering through a trade exchange, the service fees paid to your exchange.

Your barter efforts have also expanded your client base, too—as you have obtained a new customer.

To find barter companies in the USA and globally, see right-hand column, “Top Resources.”

This entry was posted on Tuesday, March 6th, 2007 at 6:41 am and is filed under Entrepreneurs & Small Business, Marketing, Purchasing & Financing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.