Month: December 2012
When Exchanges Meter Inventory
When a barter exchange has a limited volume of a highly desired product/service, it’s not unusual for them to limit the amount that each member can purchase. If asked about this policy the exchange will usually explain that this is a service to their members, allowing as many members as possible a chance at the “good stuff.” Although this is a reasonable goal I have run into troubles with these policies both as a buyer and seller. Here are some examples of times when exchanges should adjust their metering policy:
- Metering barter sales can encourage cash/barter deals. For example, if I want to send my 3 kids to a summer camp and can only barter for half the needed amount then I’ll end up spending cash on the rest. Even worse, it encourages sellers to use barter as a way to bait and switch barter members to get them to spend cash.
- As a seller, my primary interest is bartering my products as efficiently as possible. Fewer, larger purchases are more profitable than many smaller purchases. I would much rather ship out one large box than 20 small ones to sell the same volume of product. I have seen times when sales of an item are metered by the exchange w/o consulting the seller.
- If you personally recruit a member into an exchange it would be wise for the exchange to exempt you from any metering of that member’s services for the life of your mutual memberships. That is because there would be no “good stuff” to share with the membership if you had not brought the new member into the exchange in the first place. Furthermore, by not allowing you to purchase the full volume that you desire, the exchange is encouraging you to direct barter (where there are no artificial limits) with new potential members instead of bringing them into the exchange.
To wrap up I should mention that I do understand the value of metering high value products/services, however it should be done very carefully. It is easy for an exchange to come off heavy-handed with policies like this which is a major turn-off for all members.