Barter

Bartering is a way to trade goods and services directly, without any kind of currency. People have been bartering for centuries, but the Internet has opened up a whole new world of bartering possibilities. Whether you are trying to get value out of your excess stuff, or save money by trading services, read on to find out how to find opportunities to barter and arrange deals that will make everyone happy.

Steps

Choosing Services and Items to Offer

  1. Consider your professional services. The most obvious bartering choice is a service you already provide as a job, or have provided in the past. Everything from dental work to carpentry can be offered in bartering. Let potential bartering partners know you have professional experience in the area, and they will likely find your offer more appealing.
    • If you run a business, consider offering your standard services in exchange for designing brochures, preparing taxes, or filling another business need. This can be a great way to attract customers who wouldn't otherwise hire you or purchase your goods, without losing value.
  2. Identify skills associated with your hobbies. If you enjoy cooking or baking, you can offer people a home-cooked meal or pie. Art and craft items are sometimes in high demand, especially if you offer to create a piece customized to the bartering partner. If you can't think of a good or service created by your hobby, ask a close friend for suggestions: you might not realize that tinkering with your car or writing poetry in your spare time has given you valuable skills.
    • Think about hobbies related to home upkeep, such as gardening or D.I.Y. home repair.
  3. Brainstorm to discover your less obvious skills. Many people pick up skills in their job, hobbies, or everyday life that they don't necessarily realize. Write down a list of every task you do on a regular basis. Look through each item on this list and identify what skills and specialized knowledge you have that allows you to perform these tasks quickly and skillfully.
    • Many people have trouble with mathematical tasks, such as preparing their taxes or keeping good accounts of their business or household expenditures. Quick, accurate multiplication and division may be all you need to offer some basic services.
    • Other skills include home organization, computer troubleshooting, translation (if you are bilingual), or copy editing.
  4. Offer less specialized tasks that others may not be able or willing to do themselves. Many bartering trades involve pet sitting, garden weeding, errand running, house cleaning, and other services that some people can perform more easily than others. If you enjoy any of these common tasks, or if you can do them quickly, consider offering these services. These tasks can be a hardship for people with no transportation, health or mobility problems, or a busy schedule.
    • If you have special skills or experience in any of these, mention them in bartering discussions. Stretching a grocery budget or caring for an exotic pet might be something you take for granted, but they might be exactly what someone is looking for.
  5. Find items you want to get rid of. Poke around your place from a bartering perspective; there may be little things that would be hard to sell but easy to barter in small trades. Unwanted books and clothing, an extra toaster or other appliance, or even unopened wine bottles or food items can be exchanged in small trades.
    • If you barter small items frequently, try Get Free Stuff from Moving Sales, which you may be able to barter later.
    • If you grow food or raise animals for eggs or meat, you may be able to barter away some of the results.
  6. Lend people the use of your house, car, or other expensive items. If you can arrange a Exchange Your Home for Free Vacation Accommodation while you go on vacation, you can save a lot of money on hotel rooms. Alternatively, you can rent out a spare room in a bartering deal instead of charging money, or just let a traveler crash on your couch for a few days. People may also be interested in borrowing a car, or arranging for you to drive them somewhere. If you have access to a table saw, lawn mower, or other expensive tools, you could lend them to bartering partners.
    • This type of bartering can be a little riskier, since you are giving someone access to valuable items that you want back. Depending on your comfort level, you may only want to do this type of bartering with friends, or with people a mutual friend can vouch for.

Finding Barter Opportunities

  1. Look for online bartering websites. Website where bartering deals are arranged range from the all-purpose, such as Craigslist or U-Exchange, to the specific, such as SwapStyle for clothing or BookMooch for books.[1] Make sure to read the instructions carefully and learn about any membership fees, or fees to receive or send items, before you get involved with a new site.
    • Some websites require you to pay for the cost of shipping your items, which can be expensive if you are sending heavy or bulky items. It's always a good idea to find out how much the shipping would cost before you agree to a trade.
    • On some websites, members contact each other to arrange a deal. On others, you earn "points" (or another virtual currency) for providing items or services, which you can then use to request items or services from other people.
  2. Join a time bank to trade services only. If you are interested in trading services more than goods, join a time bank in your area or start one yourself. Anyone who joins the time bank can "hire" someone else for any type of work. Instead of getting paid, the person who does the work gets the number of hours she worked recorded in the database. She can then "hire" another member of the time bank for that number of hours. In a standard time bank system, one hour of work is always worth the same as another hour of work, regardless of how much hiring someone to do that work would normally cost This can make haggling over deals much simpler.
    • For instance, Frederico does six hours of math tutoring for Brad, and gets six hours recorded by the people running the time bank. Frederico then "uses up" four hours by hiring another time bank member, Alicia, to do four hours of carpentry. Frederico now has two hours credit in the time bank, which he can use to hire any other time bank member.
  3. Find bartering opportunities in your community. Searching online for bartering groups in your town or region may lead to a community forum where you can make deals with people nearby. Also check out community message boards or locations where flyers are posted to find out about deals on offer. One major advantage to local deals is the ability to trade services that require meeting face to face, or items that are too heavy or delicate to mail.
    • Large websites such as Craigslist often allow you to search for deals in your region.
  4. Advertise in your local community. Whether you are looking for individual trades or running a business, advertising locally is a great way to draw attention to your bartering offer. Make-a-Flyer around your community, talk to neighbors, or organize a family gift swap for the holiday season. Finding regular or long-term bartering partners this way can be a great way to save money on recurring needs, such as lawn care, or build better relations with your neighbors.
    • Your community center, community newspaper, or church may be able to help spread the word for free or for a small fee.
  5. Have your business join a barter exchange. Businesses can use the other methods to arrange bartering deals with customers, but your business might be looking for ways to save money when dealing with other companies as well. Consider joining a barter exchange for this purpose. Much like some bartering groups for individuals, most exchanges work by crediting your business' account with a virtual currency whenever you provide a service for another member. You can use this virtual currency to acquire services in return, although you may need to pay a fee for the exchange's matchmaking service.
    • Always look up the exchange at the Better Business Bureau and online review sites to find out if there services are above-board and worth the fees.
  6. Just ask. It never hurts to ask whether someone is open to a barter arrangement, as long as you accept "no" for an answer. Most people and businesses are not used to bartering, but may be willing if the right opportunity presents itself. Mention what services or goods you're offering, ask if there's anything specific they're looking for, then drop the subject if they show no interest.

Arranging a Barter Deal

  1. Suggest the possibility of bartering. If you didn't meet this person in a group dedicated to bartering, politely let them know about the possibility of bartering before you get into the details. Use phrases such as "Are you interested in bartering?" or "I'd be willing to trade services instead of cash if you need any home repairs done." Don't begin by offering an exact quantity of goods or haggling over the price of the visit; make sure the other person is open to the idea first.
  2. Research the possible bartering partner before you make a deal. If you were referred to a bartering partner by a friend, ask that friend about the partner's reliability. Request that the bartering partner show examples of his work if possible, and ask about his experience or certification, if relevant. The more valuable the deal, the more important it is to make sure you'll be receiving a high quality "payment."
    • If you are bartering for an item nearby, examine it in person. If bartering long-distance, ask to see photographs of the item on each side.
    • If you suspect the bartering partner might not live up to their end of the bargain, invite a friend or a neutral third party to come with you as a witness when you make the deal. Better yet, don't barter with people you don't trust.
  3. Have each party describe the service or good in detail. It's best to be exact about your offer before you get too far into the negotiating. Does "yard work" mean weeding the garden, or a full landscaping job transplanting trees? Are the items you are offering fully functional, or are there surprises the other person should know about? It's difficult to negotiate over a deal if the two parties have a different understanding of what's being offered, so clarify the offer as early as possible.
    • When offering an item, provide photographs of the item or, in the case of art commissions, photographs of past work. These don't need to be professionally taken, but make an effort to take non-blurry photographs in front of a solid-color background.[2]
  4. Determine the value of each service. For casual trades between friends, you might quickly decide in conversation that one French lesson is worth one home-baked pie. When dealing with strangers, or conducting more valuable trades, it pays to discuss the value more formally. Each party should explain how much they would normally charge for the good or service they are providing. Be open to haggling over this amount or reducing the price if it still results in a deal that saves you money. Once you've agreed that, for example, a treadmill is worth $50 and an hour of garden work is worth $15, finding a trade that feels fair to both parties should be easier.
    • Because you are not exchanging precise currencies, the value of each party's contribution is rarely exactly even. In the above example, the gardener might agree to work for 3 hours (worth $45) and receive a treadmill in exchange (worth $50), rather than work for exactly 3 hours and 20 minutes (worth $50).
  5. Add something extra if you can't come to an agreement. If you can't agree on an exchange of services or goods that sounds fair to everyone involved, throw in something extra. This can be cash, another item you're trying to get rid of, or another service.[3]
  6. Involve a third party if you need to. This strategy is more likely to come up among people who are experienced at bartering, or involved in a bartering community. Keep an ear out for people who need particular services, and see if you can work out a three-way trade. For instance, Alfred can walk Bob's dogs; Bob can repair Carol's roof; and Carol can mow Alfred's lawn.
  7. Check that you have the following details covered. For larger transactions, or transactions with strangers, it's a good idea to create an agreement in writing. For many small barter trades, oral agreement or agreement in an email can be sufficient.[4] Either way, make sure you agree on the following points before you close the deal:
    • Who is responsible for providing tools, ingredients, or raw materials? If something needs to be purchased, who pays for it, and who gets to keep the new tools or excess materials afterward?
    • What's the deadline for completing the service or delivering the goods? If it's a longterm or recurring service, pick a date in the future to talk to each other and check if both people are happy.
    • How much followup service is expected? For services which can require an unpredictable amount of additional time, such as website maintenance, it may be a good idea to agree on a maximum number of hours before a new agreement needs to be reached.
    • If someone is providing a service in your home or garden, is she expected to call in advance before she comes over, or is she allowed to stop by and work even if you aren't around?
  8. Learn how to encourage prompt and polite conversation. If you are communicating with phone messages or emails, make an effort to respond as soon as you can. If there is a delay before you can make a decision or provide the agreed-upon service or item, give the other party an estimate of the time it will take. Make it clear that you expect a response by ending emails with a yes or no question, and follow up with a polite request asking whether the other party has made a decision if you get no response within a few days.[5]
    • If you decide not to accept a deal, let the other party know as soon as possible. Do not assume they will get the message if you stop communicating with them.
  9. Declare barter trades on your taxes. In the United States and most other countries, businesses are required to report their income from bartering based on the estimated value of the service or goods received. Even individuals are required to report capital gains if they end up "making money" on a deal, again based on the estimated value of the services or goods exchanged.[6][7]
    • If you're not sure of the value of the items exchanged, try to find similar examples online such as items being sold on eBay or Craigslist.
    • U.S. businesses should report their income on form 1040, schedule C or 1040, schedule C-EZ. If you already submitted your taxes and left the barter income off, correct this with form 1040X.
  10. Understand that friends and families might want to barter more casually. Keep in mind that many people already barter with the people they know, but may think of it as a casual trade or an exchange of gifts. Your friends or family might turn down an explicit offer to barter, because it seems to them too transactional, or they might agree but not understand that you expect them to treat it as a serious obligation. In these situations, it may be best to stick with low-value, informal trades, and reduce your expectations of prompt or high-quality returns.

Tips

  • Another place to look for bartering opportunities is the farmers' market. Some farmers will happily trade excess food for farm labor or other goods and services.

Warnings

  • Watch out for scammers. Some people don't hold up their end of the bargain, so barter at your own risk! If there's a high barter value involved and you think the other party is acting suspicious, you may wish to cancel the deal.
  • In many countries, you are legally required to pay taxes on any profit you make from bartering, based on the monetary value of the traded items.

Related Articles

Sources and Citations

  1. ↑ http://www.moneycrashers.com/best-bartering-swapping-websites/
  2. ↑ http://www.u-exchange.com/photo-items
  3. ↑ http://www.u-exchange.com/barter-terms
  4. ↑ http://www.bankrate.com/finance/personal-finance/inside-the-barter-how-to-buy-without-cash-2.aspx
  5. ↑ http://www.u-exchange.com/barter-etiquette
  6. ↑ http://www.irs.gov/taxtopics/tc420.html
  7. ↑ http://www.irs.gov/publications/p525/ar02.html#en_US_2013_publink1000229343

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