Have you ever bartered before? It’s an old art form that is coming back into mainstream life with a vengeance. When I was a teen, barter was almost a dirty word. No one traded anything (almost anyway). Money talked. If you wanted something, you earned money and paid for it. If you didn’t have money, you worked to make it.
Know the value
There are several parts to this. Know the value of what you want. Know the value of what you have. Know what value the item you hold is perceived to be by the other party.
Know the value of what you want. If you want someone to clean your house, do a little research. Find out what professional businesses would charge as well as independent cleaners. Use those prices to assess what you think the other person is worth. If they have no experience, figure low (but don’t devalue them). If they work for a company doing janitorial or housekeeping work, I would feel that they would be of higher value on a personal job.
Know the value of what you hold. Don’t plan on giving something away just to get what you want, but don’t overvalue a possession either. Again, I believe that research is the key here. Again to use the cleaning example, check out your skills against professionals and independent cleaners. Know that if you start with no skills besides your own home cleaning, that you will need to price yourself lower until you build a reputation.
Doing research will also help you know what they value of your item is perceived to be by the other party in the transaction. If you let an emotional attachment to an item get in the way of the process, it can cause friction in the agreement. They probably won’t have an emotional attachment to your stuff.
Know what you want from the transaction
Are you looking for a one time deal or an ongoing, mutually beneficial relationship?
For a one time deal, and to use the cleaning example again, maybe you decide to offer to clean a friend’s house in exchange for an item they are selling, but you don’t want to pay cash for. Once you pick a value of your cleaning service, you are ready to negotiate.
Maybe you want piano lessons. Maybe you have a skill (sewing/horseback riding/etc) that you can barter those lessons for. If the cost of a horseback riding lesson for an hour is equal to the cost of a piano lesson for an hour, you could be in business!
Be Bold, But Don’t Push
Once you know what you want and what you have to offer, you need to approach the other party. Go in with your research in mind and make your proposal. If you get a flat out “NO”, you should consider looking for a different person to barter with. Not everyone is open to this type of agreement. If you get a “I’ll think about it” or “let’s talk”, be ready to state your case.
State your case in the terms that you believe will get through to the other person. If you think they are more likely to want to save time, use that. If they are a numbers person, state your case in dollar value.
Don’t try to force an agreement if it’s not working out. No one wins in a situation when one of the parties feels forced into the agreement.
Be Okay With Walking Away
Sometimes you will need to walk away from a barter. When the terms just aren’t fair, there’s no point in pushing the deal through. When you know your value and the other party is trying to take advantage of you, you need to be willing to walk away from the deal so that you don’t feel used. If you do your research, and go into negotiations knowing where that point is, you can walk away still knowing that you tried, but it wasn’t working out.
These can be very specific and laid out in a formal document or as a verbal agreement.
Unless you are bartering something very in depth or valuable, there’s no reason to think lawyers. If you feel the need to put it in writing, a simple paper with the terms signed by both parties should be sufficient. Even just email documentation of the agreement would work as a record. My personal example is the bartering I do for this blog. I often accept non-monetary items (products/coupons) in exchange for my review/write up about a product or website. Again, it goes back to value. How much is the item worth vs how much my time is worth. Or even in some cases, how much value is in the write up vs how much publicity it gives me.
Verbal agreements work just fine between parties who know each other well. We have an ongoing verbal agreement with a friend. We provide a maintenance service for them and they provide a training service for us. Verbally, these terms have recently changed. We are picking up extra work in exchange for extra training. This agreement has been mutually beneficial for over two years.
Start Small to Gain Confidence
Have you heard the story about the guy who turned a paperclip into a house through a series of trades? Over the course of several years, he was able to trade up until he had what he wanted. A house.
Find your “paperclip” and test the waters. Maybe you make paper crafts and your friend makes cloth crafts. Make a straight up trade based on retail value. Taking the step to make this sort of trade will help you find the right words when the stakes are higher.
Value is In the Eye of the Beholder Even When Research Shows a Price
Maybe you have a motorcycle and want a car. Maybe someone else has a car and wants a more fuel efficient means of transportation. Value is not always in the price of the item itself, but in what it saves or brings to the person who owns it.
In case I haven’t pointed it out enough: be fair. Bartering is not about getting something for nothing. It’s about finding a way to create a mutually beneficial transaction without having to pay for it.
What will you use these bartering basics tips to get?