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Growing Your Business Profits

Grow your business profits using dollars you have already spent on inventory!

Today is a great time to revisit the idea of bartering!  With organized barter more automated and efficient, it is a terrific time to take advantage of the increased buying and spending power in addition to the cost savings to operate your business.

Many retail stores are closing their doors due to the lack of business and cash flow.  Most retail stores believe that by slashing their prices they will cause more customers and traffic to the store.  This might be true for that moment, but isn’t the real objective to gain NEW customers and LOYAL customers?  If a store has the inventory and capacity to increase sales without it affecting their hard cost of doing business, barter is a win/win situation.  Barter customers bring other cash customers when they talk about the experience.  While barter can drive new customers to your store, the new customers can tell their friends and family about their experience and you can gain cash business at the same time you are moving that inventory or filling excess capacity.

Example: A business or retail store owns inventory and it is moving slower then expected or needed.  Meanwhile the business owner has some immediate business needs that are critical to their business.

If the business owner can market their inventory through an online trading website and attract new customers to purchase some of the items for full retail using trade credits, the business owner can then purchase the items for the business using that revenue rather than spending new money!  Some examples might be new store signage or printing and advertising!  The idea situation is the use the new barter revenue to advertise and bring in additional cash paying customers.   Don’t forget that your new clients will be loyal to you and also help promote your business as long as they continue to feel like valued customers and receive excellent value and service from your staff!  Barter clients should be a welcome addition to your business and treated as friends.  Remember they are also business owners and understand why you are trading and want to help you grow and prosper in your business also.

Cost of Organized Barter Networks: You might wonder what joining a barter  organization might cost and also the fees associated with bartering. The fees to join or membership costs vary from each trade exchange.  Most exchanges charge anywhere from $295.00 – $695.00 and up as a membership application fee and monthly fees range from $19-$30.00 per month.  Trade service fees on transactions vary from  6%- 12% cash on each transaction.  The thing to remember is that most exchanges are only charging you a transaction fee on what you purchase.  In addition consider that many times you can apply for a line of trade credit and spend into the system before you even make your first sale!  Your local trade broker will also assist you by bringing you new customers to pay the trade credit line back!  What credit card company or bank will do all that for you?  In fact a great trade exchange will establish a barter budget for you to follow so that you aren’t taking too many trade credits above what you will be spending in the system.  In the barter economy your products and services are more important than your credit score.   You can use your inventory to secure a barter loan and make improvements to your business!  Many of the fees associated with a Trade Exchange are business expenses associated with Marketing or Advertising and can be tax deductible.  You will want to meet with a qualified Tax Professional to discover the advantages of accepting Trade Credits and using them toward your ongoing business expenses.   Consider how leveraging money you have already spent into many of the ongoing cash expenses you currently have.  By moving these cash expenses over to the trade exchange you can literally put that cash back into your business or redirect it to other much needed items.

Whether you are a service related business or retail store you can benefit by increasing your customer base from  5 – 20% and reducing overhead costs by spending that new found revenue back into your business and YES even consider giving yourself a raise in to spend on personal needs.  Turn that downtime or excess inventory into what you need or want for yourself and your business.

I encourage any business that has a vanishing commodity such as advertising space, hotel rooms, empty seats or room in a cafe or restaurant to use barter to capture that potential lost revenue and turn it into future purchases and increased sales!

Need more information on how Bartering can add to your bottom line profits?  Ask The Barter Coach!

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