Is Bartering Worth It?
If you aren’t sure, bartering refers to making trades. An example in our industry would be trading free haircuts for other products or services, rather than receiving payment. Without being overly discouraging, I want to say that my short answer is no, bartering isn’t worth it. I believe people find a higher value in the things that they actually spend money on.
I used to barter, so I know some of the main challenges of it that you should think about before deciding to barter. If you’re already bartering and it’s working well for you, I don’t want this article to be discouraging for you. But for those of you considering starting to barter at your business, these are some of my suggestions to consider before you do.
Challenges of Bartering
My experience has been that sometimes when you barter with a person or a company, they don’t value your time. They may show up late or cancel last minute, because when you’ve already bent the rules for them, they start to think that rules don’t apply.
Be mindful of this. If you feel like your deal isn’t being valued, take a second look at what’s going on. It might be time to reposition or re-strategize the deal.
The other big challenge I noticed when bartering is that my talents also weren’t valued. Psychologically, if something is free, it’s really not worth as much to you. At one point we decided to stop bartering with a business, and as soon as we told them, they let us know they’d never be returning to our salon. This was completely shocking to me, because I thought we had a great relationship. But as soon as we asked them to pay for our services, we weren’t worth anything to them.
Anyone you’re bartering with also tends to not be the best referral source. How can they say, “It’s worth every penny” when they don’t actually pay for it? They don’t know how much you charge for services and therefore it’s difficult for them to do any word-of-mouth advertising for you. Your best clients--the ones who are rebooking appointments and buying merchandise from you--are a far better source for referrals. I would always recommend gaining more of those type of clients because they’ll happily pay your prices, and be immensely satisfied with the results. Those are the clients who will help you achieve long-term success.
Bartering with the Roles Reversed
On the flipside, there are also challenges and considerations when the roles are reversed and you’re the client bartering with the business.
When I was the client, I found that some businesses wouldn’t put in as much effort because they saw me as a non-paying client that needed to be in and out quickly. It was very clear that they gave paying clients a higher priority. But if I didn’t get the best outcome I would feel bad saying anything because the service was free.
In this case, you might sometimes settle for less because you aren’t paying for the service. But at the end of the day are you getting enough value out of this bartering relationship? Is it an unfair relationship where someone is getting more value than the other? This doesn’t just refer to cost; I’m also talking about time and energy. I would seriously weigh the outcomes and run the numbers and notice the differences between paying full price and a bartering system.
If you ever get to a point where you’re losing money, time or energy, I would encourage you to start a conversation to begin paying for your services rather than exchanging them. Consider offering an alternative for people that you want to have this special relationship with.
A possible example would be to give them a VIP membership in exchange for their business. At my salon we have a great relationship with a plastic surgery office. When their clients visit us they have an automatic VIP membership with us and vice versa, which gives us both perks without giving away all of our services. This is a great way to have a unique relationship with another company without infringing on your time or profit.
If you’re also at a point where you’re focused on building your success, consider these issues and the facts to evaluate whether bartering is right for you and your business.
Do you have other questions about bartering? Check out our sister company's private Facebook group to bounce your ideas off of other industry pros--we will see you there!