It’s extremely important to take good care of your restaurant barter partners and part of that is making sure you leave appropriate cash for tip/tax.  When you are paying with $10 increments of script issued by a barter exchange, figuring out exactly how much you should leave in barter and how much should be in cash can get a little complicated.  A while back I posted some instructions on (what I thought was) a good way to calculate the tip.  I have a new and MUCH BETTER, SIMPLER rule of thumb.  Check it out:

1. Always overpay for the meal in barter 
2. Leave 3 times the tax in cash

That’s it!  Is that easy or what!!??  Here’s a practical example:  Let’s say you get your bill and your total is $28 for the meal plus $2.24 tax.

1. Pay $30 in script (overpaying the $28 meal bill)
2. Leave around $7 in cash (approx 3 times the tax)

The only exception to this rule is if the bill is only slightly over a ten dollar increment.  For example, if the bill was $32, I would then leave $30 in script (not overpay) but when it comes to leaving the cash I’d leave 3 times the tax PLUS the $2 I didn’t pay in barter.  BUT….if you want to keep it simple,  you are ALWAYS safe to overpay the meal in barter and triple the tax in cash.

OK….say it with me people:  Overpay the meal in barter and triple the tax in cash!!!

My twin boys are in 5th grade this year.  Because the school that they were going to last year only goes to 4th grade, my wife and I needed to find a new school for them this year.  We knew that we wanted to send them to a private school, but we also knew that we didn’t have the cash to do so.  This is how we successfully found  a great school for them 100% on barter.

1. First we put together a list of requirements for school prospects and found schools that fit our requirements.
2. We called up all of the schools on our list toward the end of last school year and asked to get a tour from the principal and for our boys to have a “shadow day” at the new schools.  This got us a good feel for the school and gave us an introduction to the principal.
3. We then put together our final list of schools all of which we thought would work for our boys.  We ended up with 3 contenders.
4. I then put together an email to each of the principals.  I requested that the principals share the email with their school board.  It explained that we are interested in their school and  that we would like to pay the tuition in barter.  I gave a sample list of products/services that we’d be able to provide.  I was also clear to point out that there was almost no additional cost to the school by enrolling my kids.  I explained that the school would have a credit with me for the total amount of tuition (about $10k for 2 kids) and that the balance would decline as I provided products/services throughout the year.
5. Of the three schools, one was interested in a trade.  I was invited to present my idea to their school board and they accepted.  My boys started school 3 weeks ago and everything is going great.

As I’ve noted before in this blog, some people “get” barter and some people don’t.  That was the problem with the schools that declined my offer.  Instead of understanding that I wanted to pay the full tuition, they would offer for us to apply for financial aid.  There was also a concern that our deal might make other parents that volunteer, unhappy.   I tried to explain that the types of things I could provide on trade were generally not the type of things that folks could volunteer to do, but that mostly fell on deaf ears.  The craziest objection I heard was from a school board member that insinuated that if we weren’t paying cash we wouldn’t be as committed to the school.  I’m afraid the joke is on him because as we all know, barter relationships are much more involved and comprehensive than cash ones.

It was a lot of work to set up this deal, but I’ve been really pleased with how it’s been going at my boy’s new school.  My goal now is to make sure the school board is happy with the deal so they will be open to it in future school years.  I’ve applied to join the school board because I think I will be more effective at finding good ways for them to spend their barter if I’m more involved in the school’s inner-workings.

In case you are one of those folks that don’t know the difference, let me lay this out for you and make it CRYSTAL CLEAR.  The words “barter” and “haggle” do not mean the same thing!  Am I the only person that is driven crazy when these words are sometimes used interchangeably??!!  Even my wife (who can’t escape a constant barrage of barter banter) mixes these terms up sometimes.  Here are the correct definitions:

Barter:  To trade one product or service for another.

Haggle:  To negotiate for the best possible price for a product or service.

I think the cause for confusion is twofold:

1)  Traditionally, Americans neither barter nor haggle much.  As such I think many of us simply lump them both into the mental category of  ”that undesirable thing that some people do when they try to buy things cheap.”

2)  Of course part of bartering involves determining the value of the traded item and that can often include some haggling.  The confusion is caused by the fact that both are often conducted at the same time.

The reason that it’s important that folks understand the difference is because many Americans simply refuse to haggle.  If they mix these two terms up, their distaste for haggling will infect their feelings about barter.  So I send you forth, my little barter fanatics, to educate the world and spread the gospel of barter.  Whenever you can please point out the differences between these two terms.