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MARKETING CONCEPTS – CONTRACTORS
Barter Builds Revenues For Contractors
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Mark Jerse had built up a reputable contracting business since forming MAJ Home Improvements in 1991, but like most small business owners he noticed a sharp decline in sales following the September 11, 2001 terrorist attacks. Making matters worse for Mark, at the time of the attacks, were his needs for a new web site, and upgrades to his computer and telephone systems. Mark also was searching for a way to generate new business while the economy recovered and he could begin remodelling homes on a regular basis.
Shortly after the attacks occurred, Mark joined Tradesource. He quickly began to do barter deals with new customers who required his electrical, plumbing, and drywall skills as part of their home remodelling needs. Rapidly, his lost revenues were rebuilt within a matter of months, thanks to the new business he discovered through Tradesource. Mark was then able to trade for a computer specialist to design his web site, and barter for the upgrades he needed for his computer and telephone systems.
“Barter really helped save my business and allowed me to carry on rather than face the possibility of closing after 9/11,” Mark said. “Barter helps to maintain business levels, even when the economy is slow, because everyone involved agrees to do business with each other. I have Tradesource, and my Tradesource clients, to thank for providing me a way to keep going through the tough times.”
Bartering is an idea as old as civilization itself. By strict definition, bartering is the cashless, item-for-item trading of goods and services. Where our ancestors might have been trading chickens for cows, today’s savvy business people are bartering hotel rooms for printing, landscaping for computers, or like Mark, contracting remodelling services for just about anything – all this through the help of a professional barter exchange like Tradesource.
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Contractors use barter as an innovative marketing tool to generate new leads and additional commercial and residential sales, during the entire year — not only during their busy season.
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Bartering also can be an ally to small business owners looking to expand. Normally a business owner would have to go to the bank for a loan or save enough from receipts to finance the project. Barter is a way businesses can use the value of their own products and services to fund company growth.
“We probably barter an additional $20,000 a year in business through our trade exchange,” said Dennis McGuire, owner of McGuire Electric in Sarasota, Fla. “That’s $20,000 of new business that we wouldn’t have had had it not been for our decision to join our barter company several years ago. We use barter to service our vehicles, buy new tools and equipment, and uniforms for our crew – all without having to write a check.”
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Barter has also allowed me to trade for my weekly home lawn care service so that I have more time on the weekends to do the things I want to do. Barter has really enhanced my lifestyle.”
Always keep in mind that barter is still a business deal. That means you should use the same good sense in making barter decisions as you would if you were paying cash. Check out the company: How long have they been in business? What do their clients say about them? Do they have a showroom and a directory? Are they members of the National Association of Trade Exchanges? These are all important things you need to know before joining a barter exchange.
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Contractors use barter as an innovative marketing tool to generate
new leads and additional commercial and residential sales,
during the entire year — not only during their busy season.
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One-on-one bartering is common among contractors, but joining a trade exchange or barter company (a clearinghouse for businesses to barter among themselves) can give you more flexibility and opportunity. The barter company also gives you a great record keeping system so you’ll always know where you stand with your barter account. There’s no additional bookkeeping on your part.
When you join a barter exchange, expect to invest between $300 and $600 in the membership. You’ll have about $20 in monthly promotional fees and pay 12 to 15 percent commission on your trades. In return, the exchange will provide you with constant promotion of your business, ongoing account maintenance, a monthly statement, membership directory, a personal trade broker to find what you’re looking for, and most importantly, lots of new customers.
“I had a real hard time with paying fees to barter when I had been doing it on my own for 10 years,” said Jason DeFranco, owner of DeFranco Painting, in Philadelphia. “But when I sat down and took a serious look at all the accounts I was running a tab on, and how many I never received anything from, I saved a lot of money by paying the barter company. We’ve even moved most of our direct trades into the barter ex-change. It just makes sense.”
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Lastly, remember that both parties are customers in a transaction. You should expect and extend courtesy, high standards, and a commitment to providing a great product or service.
With these guidelines in mind, contractors can take an ancient practice like barter and put it to work in the modern world.
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Barter provides contractors with a competitive edge barter clients will bypass their competition.
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“One of my barter clients called me to do some repair work on the roof of his building,” said Gary Gladdin, owner of Gladdin and Sons Roofing in Rochester, N.Y. “He was so pleased with the job that he also contracted with me to do a tear-off and replacement on the roof at his home. When I started the job I put my sign — which by the way I bartered to have printed — in his front yard. Two of his neighbors saw the sign, stopped by while I was working on the roof, and asked if I’d look at their roof as well. It turns out that I got two new cash customers as a result of my barter deals.”
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