Anyone who has bartered for very long is aware that occasionally you can run into a vendor that treats you like a second class citizen because you are paying for a product or service in trade. It goes without saying that this is to be avoided and that we should all do our best to service our barter clients just as well as folks that pay with cash on the barrel-head. That being said, it’s also possible to treat your seller poorly when you are buying something on trade.

Let me put it this way: It’s a lot easier to blow off your personal training session if you are paying for it in trade than if you are paying in cash. Doing so however is not fair to your barter partner or yourself. The vendors that you buy services from on trade, like personal trainers, massage therapists, doctors, chiropractors, CPA’s and yes even lowly web developers deserve to be treated like the professionals that they are even when you are paying them in trade. This means you need to show up for appointments, follow through with “homework” they assign, and even take the advice that you are paying them to give.

Additionally I should point out that it is totally self defeating to hire a professional then not follow through.  In order for consultive work to have the desired effect you have to actually act on the advice you are given. When you get that advice at a discount through barter it may be tempting to discount the actual advice. To do so however would be a mistake.

I once read a report that said that the success of any given smoking cessation program is directly proportional to the cost of the program. Simply put, the more expensive the program, the more the participants were emotionally invested in quiting so they had more sucess. So…with that said I think it’s very important to understand how much of a blessing it is to be able to take advantage of services through trade at a substantial cash savings and for you to NOT use this as an excuse that undermines the whole point of the service.

Over the years it has come to my attention there there are a couple things that us barter fanatics can do when we trade that will gain us a little “float” with our transactions and help with cash flow.    Here’s my current list:

1. If given the option when setting up your exchange account always opt to pay as much of  your commissions as possible when you are making a purchase.  That way you don’t have to pay commissions immediately when you make a sale.  It may even be worth while to pay a slightly higher commission if you can pay it all on your purchases.
2. Put your “commisionable” transactions through your exchange after the first of the month.  Most exchanges bill on the first of each month.  If you wait until after the first you won’t be billed the commission for an extra 30 days.
3. Assuming you are paying part of your commissions on your “sell” transactions, then it doesn’t make any sense to build your account up to a high balance.  Not only does this incur barter commissions, but you will also be taxed on this income that is sitting in your barter exchange account.   It is more to your advantage to earn at roughly the same rate as you spend.
4. Once you have proven to your exchange that you are a good member that can and will earn barter credits on an ongoing basis, they may extend you a line of credit.  By using this line of credit you can purchase products and services without paying any “sell-side” commissions at all up front.  You will of course need to earn those credits back eventually and the commissions will be due at that time.  Also if your exchange is charging you interest on the line of credit that probably more than wipes out any cash flow advantages.

I wish this was the first time I’ve heard this story…but it’s not.  Please accept this story as a warning of all the things a barter exchange should NOT do. In case you are not familiar with what a “barter exchange” is please check it out here.

I just got off the phone with a former member of an exchange I’m in.  I say former because he tells me that he told the exchange that he was closing his account over 6 months ago.  The reason I was calling him was because the exchange had recently sold me a gift certificate for his services (that he will not be honoring).

Mistake #1
The vendor says that he was led to believe that there were many members in his immediate area when in fact there were not.  I’m a firm believer that a member’s success (or lack there of) is directly related to the volume of members in their geographical area.  If you are recruiting a member that isn’t in an area with a lot of other members you have to be up front about that.

Mistake #2
The vendor says that the exchange does not police member pricing.   Over pricing is a major industry problem and I don’t see it going away any time soon.  I think the solution is for exchanges to police pricing and kick out gouging members, but honestly I don’t think most exchanges have enough staff to stay on top of this.  What I told this particular person was that if his exchange won’t watch out for over-pricing then he’d have to do it himself.

Mistake #3
The vendor says he was given poor customer service in general by the exchange.  He says they didn’t do any training with him and weren’t particularly helpful when he ran into problems.  From his point of view the only time they ever called him was after he decided to sever the relationship and even then it was just to harass him for monthly fees.

Please note that what I’m telling you is all from this former member’s point of view.  The conversation I had with him was lucid and cordial and I tend to believe what he said.  That being said I’m quite sure that his former exchange would have a different take on the events.