Back
in the day, when there was no such things such as cash, money, currencies, etc,
people made bargains through trading. Popularly known as the barter system, in
this, an individual would trade valuables in exchange for other items. Let’s
take an example. If you have a hankering for chocolate today you can just go to
a store and purchase it. In olden times you would have had to give something
else which the owner of the chocolates wants and thinks is equal in value.
Modern Barter System
The
barter system is actually still used today, and it is one of the best known
ways to conduct a trade. Let’s say you are new in the world of business; you
have raw material, but you do not have the machinery needed in order to get the
material processed. What you can do is make a trade with the owner of the
company from where you want to buy the machine from. You can trade some raw
materials, or what you can do is sign a terms contract that at the end of every
month you will supply ‘x’ quantity of the finished goods to them.
In
this way, not only will you get what you need, but also in a way you can
promote your item as well. This was just the beginning, this trade can be done
with lots of people who are an essential part of the business, and you can
trade for their services even if you do not have cash on hand.
The
Down-Side
There
is a down side to this system though, often, the person with whom you want to
trade will not want the item you are offering in exchange for their services.
They may not believe in the barter system thinking it might compromise their
business. Some business owners are really strict about their rules, policies,
and terms. They do not believe or follow the barter system as they think it is not
as beneficial as cold, hard cash is.
The
barter system has no additional taxes or profits on them, as the services and
materials have a specific and fixed value. This means that the person offering
the business will not gain any profit in any sort or form; they will just get
the money which is equivalent to their services, and even less at times. The
barter system is not always beneficial for many companies, as trading would
make it impossible. Say for instance you approach a farmer for feed, and in return,
you are willing to give him a piece of technology, such as a tablet. The farmer
may know what to do with it, and most likely this will result in an
unsuccessful trade.
How
to do it
If
you are willing to proceed in the business world keeping a barter system in
mind, the first thing you have to do is find out what you can possibly offer in
trade which is equivalent to the amount of the goods you want in return. This
can be tricky, as not everyone will want what you are ready to give, which is
why you must figure this out before you can approach anyone.
Once
you know what you can trade, find other businesses and small companies which
also trade according to the barter system. Approaching a business which does
not use this system will only prove as a waste of time, so you have to get all
of your homework done.
The
next step would be to have a strong proposal; this will let you keep the ball
on your side of the court. The first impression should always be such that
sweeps everyone off their feet and completely mesmerizes them. Approach small
businesses and companies first, then gradually take one step at a time to reach
the top. Finding the right traders will be time consuming and sometimes there
will be deals in which you may face a bit of loss, but it’s a start, so you
will have to make a few sacrifices.
Convince
your Clients & Customers
You
will have to convince your clients that this trade is beneficial for them;
until and unless they see something in this trade which is good for them, it
will be hard to bargain. The same goes for your customers, you must show them
how the trade they are receiving benefits them or that it’s the best deal which
they can get.
There
will be clients and customers who will disagree with you that barter system
trading techniques are not beneficial, which is why you must plan strategies that
can prove otherwise. Sometimes there will be trades in which you will need to
bargain using cash as well, but what you can also do is pay half through trade,
the other half through cash.
Round-Up
the Best
If
you think that you will not be able to personally convince your customers and
clients, hire a team who are professionals at this. Take sales representatives
in malls for instance; they are experts in convincing the customer as to why their
product is the best, and why they will not regret buying it. So make a team that
is good at sales and whose members have good communication skills. You can get
friends, family, and ex employees to help you in this if they have these skills.
Set up an interview to see if they can convince you into trading for your own
product and materials. Hire only those who are able to do so and make a team
who can barter your way to success.
The
future of the barter system is hard to evaluate and determine as a lot of extenuating
circumstances can compromise a trade, but, there is no harm in following this
system if you own a small business. Just keep in mind that you cannot give up
just because you cannot find the right trading options. Success comes to those
who wait, think outside the box, and always remain positive.
No comments:
Post a Comment