9 Effective Tips to Leverage MOXEY
Cash is tight, but you still need goods and services. One alternative solution is bartering–trading what you have for something you need. In 2008, the International Reciprocal Trade Association estimated that 400,000 companies around the world did $12 billion worth of those transactions, up 10% from 2007. (American companies account for the bulk.) How to be a savvy barterer? Here are nine tips.
1. KNOW YOUR REAL COSTS
The nice thing about trading in money is that everyone knows what that paper is worth. That’s why you better understand what your product and service costs to deliver before using it as currency. Example: Craig Vestal, owner of Portage Printing in Portage, Mich., only schedules barter work during lulls in regular business hours in order to spread his fixed costs–adding overhead by racking up overtime doesn’t pay off.
2. JOIN AN EXCHANGE NETWORK
There are over 400 barter networks around the globe with as many as 400,000 participants. These clearing houses facilitate transactions by equating each product and service to a certain amount of “trade dollars”–ensuring that both sides get something of equal value in return. Barter networks generally charge a one-time entry fee, from $450 to $800, and take a sizable cut of each trade, from 8% to 15%, usually half from the buyer and half from the seller; some demand a minimum dollar amount of trade per year.