Don’t ever accept bartering as payment for your services
In this post I’m going to explain why you should never accept bartering in exchange for payment for your services. Bartering will kill your business, even though it looks like a sensible and even lucrative method of growing your business.
Providing services in exchange for other services or products, without any money being transacted, seems like it’s cutting out the middle man.
Think about where you are in your business, right now. Maybe you’re barely able to pay the bills. You struggle with rent and can’t afford to hire anyone. Maybe you’re trying to grow past a certain point and it seems like a never ending cycle of working, just to keep your head above water.
If another business offers to help you grow your social media presence, which will help you get more followers, which will help you get more customers, in exchange for you doing something for them. That makes sense right?
No one values what they do
The biggest problem with bartering is that no-one truly values what they do. By definition, if you’re accepting bartering you probably don’t value what you’re producing.
Businesses that know how useful, important and life changing their products are, don’t barter. It’s a measure of confidence to say “my services and products are worth $X or £XXX”.
If you don’t value what you do and have a clear idea of what it’s worth, then other businesses WILL take advantage of you. If you have a potential customer that is haggling on price, it can make sense to get the deal if they give you something in exchange.
A website for example, should be $10 000 minimum. That’s serious by the way and I’ll happily argue the point to anyone who wants to. If you’ve got a customer trying to bargain you down to $1000, get them to send me an email michael[at]sellyourservice.co.uk.
If you don’t value your website service at $10 000, instead you imagine it’s worth $5000, the customer is only going to give you what THEY value to be $5000 worth of services in exchange. It’s no more fair than having the money instead.
Some services don’t hold value
You have to remember that some services don’t hold their value either. If you’re a copywriter, and you tell a customer that you’ll produce their blog posts, emails and sales content, your service might hold better than theirs.
If in exchange they give you hosting or a website, your content will serve them for years to come. Hosting as a commodity goes down in price all the time, thus eroding the value of your service over time.
Bartering keeps you where you are
On one level, if you only work with businesses that barter, you’ll only ever work with barterers in the future. It’s impossible to grow your business if you’re working with people who will always remain stagnant.
If only there was a way to exchange goods and services at a measurable rate
Oh yeah, there is. It’s called money.
“Bartering makes society more fair”
Narrator: It doesn’t
As we’ve already seen, bartering is less fair than exchanging for money. If you exchanged your services for food, you’d literally have to eat all your “earnings” before they rotted.
The only people who argue that bartering makes society more fair, are people who either don’t value what they do, or have an overly simplistic view of the world.
Businesses that create life-saving drugs or communication devices for disabled people, can’t invest in new technology with bartered services. What’s valuable to a developer might be completely worthless to a manufacturing plant in China.
Bartering doesn’t make society more fair. If anything, it becomes more elitist, with the top members of society controlling more universally accepted goods. And wouldn’t you know? Those goods tend to be precious metals which in turn, usually get turned into money.
Faster access to more money
The world of money and currency in 2019 is 100x faster and more accessible than even 20 years ago.
We can buy and sell goods, using only our phones. Money is attracted to speed. And businesses that can exchange money faster will attract more of it.
Bartering kills economies. There has never been a better time to start a business. With currencies being accepted all over the world, through apps like Stripe and PayPal, you don’t even have to sell in the currency your customers use.
Value of money is decreasing
It’s also important to know that all the time, the value of money is decreasing.
Inflation, is often wrongly described as “the value of goods and services going up, meaning prices go up”.
This is incorrect. Inflation isn’t the cost of products going up. It’s the value of MONEY going down.
Technically, none of us use money anymore. As we no longer have a gold backed economy. What we do use is currency. More specifically, fiat currency, which literally means “faith based currency”.
It’s money backed against the US dollar. Which is itself a currency. Everything we use as money is literally based on faith that it’ll be worth the same amount tomorrow.
I’ve done a terrible job explaining that so I suggest you read Rob Moore’s book Money and Robert Kiyosaki’s How To Raise Your Financial Intelligence.
The value of money is decreasing all the time, so it’s up to YOU to make sure you get very good at valuing your services and attracting as much money as possible.
You can’t pay the bills with someone else’s services
I think this is the biggest reason to never barter. I can’t pay my bills with someone else’s services.
I can’t pay my mortgage, gas, electricity, petrol, internet, phone, credit cards, water, plumber, electrician, staff, hosting or any other services I render, with a social media manager.
I don’t care how incredible you are at graphic design, editing, copywriting or development. I have to exchange the value I create, for money. Otherwise my bank is going to notice.
Post in a business group
I’m not going to call out which group I saw this in. But I have seen it in several groups that are supposed to support entrepreneurs and help them grow their business.
The idea that ANYONE with even a modicum of business intelligence or experience would suggest that bartering is a viable business strategy is disgusting.
It’s like suggesting that kids should start smoking or that porn is a good use of time. It shows a dangerous level of ignorance AND highlights a growing problem of “business leaders” in communities who have absolutely no fucking clue what they’re talking about.
How to stop bartering and start accepting money.
Raise your standards
Internally, you need to do everything you can to raise your standards. Raise the standards of the types of customer you want to work with and the types of businesses that you network with.
I’m telling you for a fact, as sure as day turns to night, if you continue to barter you will never ever find financial stability or security.
Think long and hard, repeatedly to yourself, how you ARE worth money and charging a fair price. Read more books on self improvement, work on your confidence levels. Don’t expect the world to become a better place, become a better person yourself.
I know exactly why people like to barter. Because it reduces the likelihood of rejection through sales. If you’ve never had a lot of money growing up, money can seem intimidating.
If you’re a shy or reserved person, the idea of someone else saying “that’s way to expensive! I’m not paying that! My nephew can do it for 1/10th of that price!” is terrifying. I really do understand.
And you have to choice to rise above that. Read more, educate yourself and get yourself into a community that supports growth. Like the Sell Your Service group found here.
Be clear on your pricing
The more confident you are on your pricing, the less likely you’ll accept bartering. By working on your pricing model and your financial structure, you’ll know what you’re worth.
If you need to make $100 000 a year, and you want to work on 10 projects a year, that’s $10k per project.
Honestly, it’s as simple as that.
Promise yourself and your customers that you’ll deliver $10 000 worth of value, in exchange for the $10 000. Use your willingness to please as a strength and over deliver compared to the price. You won’t go far wrong with that.
Learn to sell, not barter
Make sure that you get comfortable selling.
I keep seeing #nosales for a lot of agency and business related content.
That’s like training for a marathon with #noblood as a tagline. Sales are THE single most important business activity you can undertake. Bar none.
If you’re unconfident with selling, get confident. There is literally no other activity in your business that is responsible for 100% of your income.
I’m sure the #nosales is just a clever marketing hook. And really, they do teach sales but they just don’t call it sales. If it makes you uncomfortable, good.
Running a business is about selling your value to a marketplace. If you want work without sales, get a job. It’s far easier and you can let other people find customers.
The definition of sales “working out whether it makes sense for two parties to work together”. Marketing, doesn’t produce sales. Social media, doesn’t produce sales. Advertising, doesn’t produce sales. They contribute and can get people to the point of sale.
But SOMEONE or something has to let the buyer know that it makes sense to work with you. They can let you know they they’re worth working with also, by paying you.
Get better clients
Finally, “beggars can’t be choosers” is the weakest argument for either bartering or accepting all clients.
First, you’re not a beggar. You’re providing expert services and valuable products to a market that needs them. You are the absolute opposite of a beggar.
You’re taking total control over your life and actions and doing something responsible with your time. You absolutely deserve to be choosy.
You’re selective about the clothes you wear, the car you drive, the cereal you eat, the TV shows you watch. You can be selective about the customers you work with.
Raise your standards, get clear on your pricing and learn to sell. That’ll put you in the best possible position to get better clients.
My competition/customers won’t like my prices!
I totally understand. There are 2 reasons that customers won’t pay your price.
- You haven’t explained the value of what you’re offering clearly enough
- They just don’t get it
It’s as simple as that.
If someone asks me about “bleeding heart” stories, customers with a real sob story or who need the help, my advice is to tell them the exact same thing I was told.
“If your cause is that important to you, you’ll find the money to make it happen”.
As for your competition, who cares?
There’s no such thing as “middle ground” pricing. If they think you’re too expensive, fine. Who cares? Do you HONESTLY expect to get good business advice from people competing against you?
If you want to learn more about selling and generating more income, you’ll love our Funnel Sales Playbook. Ryan Deiss of Digital Marketer gave us his step by step system for selling CVO funnels to customers, and you can access it below, for free.
You’re worth charging for
“No one can make you feel inferior without your consent”
You’re a capable business owner and you produce great work. Just because the tiny, microcosm of people around you struggle to pay you, doesn’t mean that everyone in the world will. There are literally thousands of businesses willing to pay you for your valuable services.