So….how much barter really is too much? Ultimately that is an indiviual question. I’ve heard people in the industry throw out recommended percentages as rules of thumb… 5% of your total sales; 10%, 15%. It’s nice to have a number to put out there for newbies but I really question the accuracy of any general number like that applied across the board.
First off I should point out that 99% of the traders out there that think that they can’t handle more trade are probably wrong. It’s not that they have too much trade, it’s that they are not good enough at trade to take advantage of more trade than they are currently conducting. I don’t mean this as an insult. It applies to myself as well. Right now I have more of one partcular barter currency than I need and I’ve (for the most part) stopped accepting that currency. Does that mean that I have too much? Maybe. Or it could mean that I simply have not yet figured out how to use that currency to my advantage well enough.
Occasionally I hear a story about someone who supposedly lives on 90 to 95% barter income. Frankly I find this very difficult to believe. As much as I love barter, there are some things that you have to pay for in cash. Taxes for example. The IRS won’t take a chicken as payment. Plus, trying to barter for absolutely everything you need would be a lot of work. I’m not convinced that one person would have enough time to in a normal work week to find all the trades they need to make it on 95% barter income. I’d also point out that because setting up a trade takes a while, even if you have enough time in your week, that doesn’t help you with an immediate need you might have in the next hour.
I just checked over my records for 2010 and it looks like about 35% of my income was on trade. I don’t know about you, but that number is a little scary to me. I love to trade, don’t get me wrong, but it is unsettling to me that I am that dependent on barter. It means I really need to be motivated to find good trades for things that my family needs. If I don’t find those trades, my income goes down substantially.
Of course, it’s not like I’m decreasing my cash sales in order to take on barter sales. All barter sales are in addition to the cash sales I was going to do anyway. So from that point of view, the percentage doesn’t really matter. Barter does not replace my cash slice of the pie. It helps me have a bigger pie.
I realize it’s a somewhat personal question, but I would be very interested if folks would post back a comment on this article and let me know what percentage of their income is in barter and how they feel about that number. Feel free to post autonomously.