One of the best things you can barter for is food; everyone needs it and it’s definitely a recurrent purchase that you have to spend cash on if you aren’t bartering for it. With that in mind, I have to brag a little that I’ve got half a steer chilling in my freezer that I bartered for 100%.

I started working on the deal well over a year ago. I contacted a couple different local farmers to see who might need some of my company’s services in trade for some beef. I found a couple possible barter partners (including one rancher that specialized in long-horns), but ended up finalizing a deal with a rancher that raises grass fed Angus beef. My firm built a small/simple website (http://sonomanaturalbeef.com) for them in trade for credit with their company. A couple weeks ago the deal came to fruition as I picked up 5 boxes of vacuum packed beef from a local butcher that was cut to my specifications. Everything including the butcher’s services were purchased on trade.

As there usually are, there were a couple minor hitches in the deal that I should warn you about. Firstly, before you try for a trade like this you should understand that I was dealing what you might call a “boutique” rancher that raises very good but pricey beef. Make no mistake: I am very happy with the deal, but I wouldn’t argue that buying beef this way is a good way to save money. Secondly, I would warn you that a half a steer takes up a lot of freezer space: more than many people have. Make sure you are ready for that. The last issue that I’ve run into has to do with the fact that I’m trading away a bunch of the beef to other barter partners and figuring out how to price the individual cuts has been a challenge. When you buy half a steer, you aren’t paying per pound and there is no guide to figure out how you should price the ground beef vs. the bone-in rib eye steaks (see above photo).

Bottom line, food is one of my favorite items to barter for. I strongly recommend that you make a deliberate effort to trade for good quality food.

For all of us barter geeks, the holy grail barter deal is a recurrent deal for something that we would have had to pay cash for. All the better if that trade is for a business expense. As such I have to brag just a little because I am currently enjoying my second month in business offices that I am 100% trading for. The trade is all-inclusive and covers space, power/water/sewer, heating/cooling, maintenance/cleaning, Internet access, furniture, limited meeting room access, etc.

It was a considerable amount of work to put together the deal. Ultimately it was a personal connection that helped make it happen. I started out by asking my existing business and barter connections if anyone knew of some local companies that have too much office space right now. After several dead ends, I ended up with a contact for my current landlord. They were in need of web development services (what my company does) and have a very large office will a significant amount of available space (due to selling off a division of their company). Ultimately we settled on a hand-shake agreement for my firm to pay our “rent” in credit to our landlord to conduct online marketing work. We will be supplying a monthly statement showing credit that they’ve earned with us and the amount of work we’ve conducted for them.

It’s not all sunshine and roses though; there is a down-side to bartering for office space. Honestly, I get the feeling our landlord is not particularly motivated to rent out the space we are occupying. It feels to me like renting to my firm is a nice bonus for them as long as it’s not an inconvenience. I don’t think it would upset them if we were to leave. I can’t blame them for this attitude because their core business is not renting out office space. What that means is that I’m not in a particularly strong position to ensure they fulfill the details of our agreement.

Over-all I have to say that (despite some detractors) that I am very happy with our new offices and hope for a long relationship with our landlord once we have some of the kinks worked out.

Let me state the obvious first: It’s not actually possible to do the impossible. That’s what “impossible” means. That being said, over the years I’ve made some barter deals that were hard to put together. Deals that my friends and family said couldn’t be done. These are the deals that make people say “Wow.” I’m talking about bartering to pay employees, or bartering to put my kids in private school or any number of other unusual barter deals I’ve put together over the years.

Right now I’m working on one of the harder deals I’ve tried to put together: Bartering to rent high end commercial office space. It hasn’t happened yet, but I’ve got two different contacts that I’m negotiating with and I think I should be able to make it happen. I’m hoping that the trade will be “full service” and include power/heat/Internet/cleaning/etc.

There are two main components to putting together the impossible deal in my opinion:

1. The deal HAS to be a win-win for both parties. As long as both parties gain, the deal is always doable. It only gets truly impossible when you get greedy and are only looking out for yourself. In the case of the office space deal I’m working on, I’m specifically looking for occupied space that is too big for the current tenant. The ideal partner for this would be a firm that did some downsizing and has had a bunch of empty space just sitting there for a year or more. Because all of their office expenses are sunk, if they were to allow my office to move into their space, they will get all the benefits of whatever I trade with them at almost zero cost.
2. You have to be tenacious. When you are trying to do something unusual you have to expect that many people won’t understand the offer or will be frightened off by it. That means that you have to look at your deal like a salesman talking to prospects. When I do this I know that what I’m offering will be a really good deal to the right company and I know that that right company is out there. I tell myself that I will find the right deal if I talk to enough people. It’s simply a numbers game. If only 1% of my deals will close then I have to be ready to get 99 “nos” before I get one “yes.”

You know how EBay users can rate each other?  Folks can post notes about their experience doing business with you.  As a buyer when I see that 300 people have posted back feedback 99% of which was positive it greatly lowers my perceived risk in making a purchase.  I have never seen the equivalent in a barter situation, but I have started doing something that is almost as good:  Letters of Reference

In past years I’ve had a tough time bartering within a specific industry.  People just weren’t used to the concept and it made them nervous.  I finally broke in and made a couple good trades with some businesses within that industry but didn’t have luck with some specific players that I was originally interested in working with.  A year later I went back to my successful trade partners and asked for letters of reference.  Armed with those letters I went back to the original businesses that turned me down and low-and-behold….it worked!!  With one business in particular that turned me down flat a year earlier, with the help of my new letters I got a enthusiastic “yes” to my request to barter.

Helpful hints for letters of reference:

1. You need to help your happy customers write letters of reference.   As happy as they are and as much as you believe them when they say they’ll write a letter for you, very few of them will actually follow through.  It’s nothing personal; they are busy running their own business.  So when I say that you will need to “help” them, what I really mean is that you will have to write it for them.  What I’ve done in the past is contact the happy client and ask them if it would be OK for me to write a rough draft of a reference letter for them, that they can then check and edit however they want.  They have always agreed and have pretty much always approved what I write w/o change.
2. Within the letter, try to get across the message that the client was happy with the transaction and that it was a pleasant and profitable experience.   Put yourself in the shoes of a nervous prospective barter partner and include what you think they would want to hear to calm their fears.  Of course it goes without saying that anything in your letters should be 100% truthful.

I was contacted by the folks over at Yahoo Finance the other day looking for some quotes for an article they were writing about…..you guessed it…..BARTER.  So here it is a week later and they included a couple of my comments and a link to our site.

Thanks Yahoo!!!!

http://finance.yahoo.com/news/ask-farnoosh–i-want-to-barter-my-services–where-do-i-start-175130295.html

If you are an active trader you will constantly be cooking up new deals, meeting new people and making new offers.  Many times of course you don’t end up closing the deal, but the times when you do more than make up for the times that you don’t.  I recently had a monumental rejection that reminded me that not everyone wants to be my friend.  It’s important to understand those so they are easier to let go and move on.  Otherwise they can eat you up and keep you from making future deals.

Here’s what happened:

I was looking for a piano tuner to tune both the baby grand that we just inherited from my mother-in-law and my church’s piano.  It seems like a pretty good gig to me because I only live 4 blocks from my church.  It’s a two-for-one for the right tuner.  Additionally I understand the importance of having them tuned on a regular basis so this is potentially ongoing work for years for whoever I make a deal with.  I checked out my local barter exchange and they didn’t have a tuner.  Next I looked to see if there were any local tuners that were posting in the barter area of craigslist.  When I didn’t find anything there I sent out a canned email to all the tuners that post on craigslist for cash explaining that I’d like to barter and asking them to get back to me if they are interested.  I had two different guys respond who both seemed qualified.  The first guy who contacted me (we’ll call him Mr. Pain) was willing to trade but wanted something very specific in trade that I did not have immediate access to.  Additionally it was worth a lot more than his services so we were going to have to figure out how he could make up the difference.  I worked on bartering for that item for him while in the mean time also kept working on the second guy (we’ll call him Mr. Easy).  After spending an hour or more I was able to put together a trade to get the item Mr. Pain wanted.  I emailed him and let him know that I could get the item and sent him some details to see if it was acceptable to him.  The deal was not closed by any stretch of the imagination.  In the mean time Mr. Easy got back to me, was extremely flexible about what we could trade, and his rates were HALF of what Mr. Pain’s were.  As his name implies I easily closed the deal with Mr. Easy, and set up the appointments.  I also dropped a line to Mr. Pain thanking him for his time and letting him know that I ended up hiring someone else.  I also let him know that I’d be happy to reconsider his services if my other deal fell through.  Mr. Pain responded with the following email:

Please don’t contact me anymore with your nonsense. Energy waste when sleazy deals change with an eye blink everytime. I DO NOT NEED ANYHING FROM YOU.

Well thank you too Sunshine!!!!!  So….what happened here?  In retrospect I think Mr. Pain is simply not a particularly happy guy and has a propensity for distrust in the first place.  So…with folks like that if you throw barter into the mix you just never know what you might get.  I could choose to dwell on his negativity OR I could think about how cool it was that Mr. Easy showed up and saved the day.  I choose the later.  Honestly every deal that happens makes up for 10 or more that fall through.  AND… this also reminds me that I really need to take good care of Mr. Easy.

So cheers to all you Mr Easys out there!  It’s not worth spending any spiritual energy on Mr. Pain because he’s his own punishment anyway.

Here’s a recent email I sent this morning to a contact I have who works in the technology department of a large barter exchange.

I think most people mean to leave tax and a good tip when they go out, but the calculations are difficult to work out sometimes.  This could be very helpful in keeping restaurants happy members and make life simpler for members as well.

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.

Remember I posted a rant a few months back about how irritating it is that drug dealers keep trying to barter pot on craigslist?  Check this out:

http://www.pressdemocrat.com/article/20121113/articles/121119846