If you want your business to be more profitable, and what business owner isn’t looking for that, this is a great time to turn your attention to trade aka barter. The idea of trading for goods and services has been around for centuries and has been 
gaining in popularity by business-savvy entrepreneurs.
Membership in Tradesource can help you increase your profits by lowering your overhead and operating costs. When you join a trade group you will be interacting with other like-minded business owners who are looking to exchange goods and services. You can utilize barter as a way to rid yourself of excess inventory, save capital, advertise your products or services and meet a new group of business owners with whom you can interact. Joining a trade organization not only helps you barter for what you need it also leads to cash customers – and let’s face it, no business owner can operate unless cash keeps coming through the door.
Here are three tips to use trade to help your business’s bottom line:
Rid yourself of excess inventory – Is your warehouse overflowing with inventory? Do you have office equipment you need to divest yourself of? Look to your trade partners as a way to swap the inventory out for goods or services you need. Imagine clearing out a stock room full of office equipment in exchange for updated business cards, office cleaning services or even tickets to sporting events to offer your employees as incentives for jobs well done.
Preserve your cash – There are simply some items you can’t get through trade but bartering for things that you can, frees up your cash. Imagine the cash you’d save if you bartered for office space.
Unique ways to advertise – Every business owner knows that television and newspaper advertising, while effective, are sometimes cost prohibitive. Imagine if one of the trade partners was a newspaper, radio or tv affiliate and you could work with them and exchange your goods or services in exchange for advertising. What a great way to spread the word about what you do without trying to dig up the cash to do it. Additionally, if you’re a member of Tradesource you have the opportunity to put together an offer which will then be broadcast to the members via a weekly email or by the members simply logging into their account and viola, there’s your offer being seen by the 1,000+ members and it didn’t cost you a cent.
Barter is a beneficial method of operation for business owners but you need to make certain you’re not getting too heavily weighted on barter and lose sight of operating capital. Here are three items you need to keep in mind when it comes to trade:
Don’t undersell – Don’t lower the prices of your goods and services simply because you’re trading them. Conversely, don’t overprice your goods and services. Also, don’t think that just because you’re getting a service on trade that you should overpay for it. If it would cost you $500 in cash to get a website built, it should cost you $500 in barter as well.
Viability of business – Just as you’d do your due diligence before getting involved with a business in a cash transaction, you need to do the same with a potential trade partner. You don’t want to offer up, and deliver on your goods and services, to a business only to find they’ve gone under without delivering on their promise to you.
It’s not a tax free transaction — The IRS makes certain it gets its cut of the trade transaction. Talk to your accountant so that you fully understand the tax ramifications of the trade transaction. Additionally, you will want to fully understand the fee structure of the trade association that you’ve signed up with.
Bottom line: Trading can be a beneficial operating method for your business as a way to get the things your business needs and wants while preserving your cash. Talk to your potential trade broker before you sign on the bottom line and investigate the members of the potential trade group to see if it’s a good fit for you.