A lost art among entrepreneurs these day is the act of bartering. If you’re low on funds but have tons of products or a valuable skill, the first thing you should consider is setting up a barter to keep the ball rolling! What’s a barter, you ask?
A barter is the exchange of things (such as products or services) for other things instead of for money.
You get the gist? You better get with the barter boo. Kyshira Moffett of #HERMovement got a chance to catch up with Whitney Barkley, Founder of Barter Babes and put her on the hotseat to ask her why bartering is the way to go and more! Whitney’s spark for her business began when she attended a local women’s conference in Cincinnati during August of 2015. “There, I met amazing female entrepreneurs who were talented in their business but lacked the tools and resources to take their business to another level. As I networked, I would meet someone and say to myself, ‘Wow, she needs to meet her,’ or ‘The two people I just met need to connect.” After leaving the conference, she then began to conduct research on why women owned businesses did not flourish.
She went further and researched bartering by conducting both secondary research and her own survey to 108 female entrepreneurs in 18 states (one participant was even from the UK!). By November 2015, it became clear to her that starting a community or “shared economy” for female entrepreneurs could be a game-changer to help women network and sustain their business through the practice of exchanging services. Barter Babes (Bold, Ambitious Bosses Exchanging Services) is an online platform that helps female entrepreneurs exchange services to reduce startup costs. The platform’s vision is to help women survive past their first three years of business through the practice of bartering. Barter Babes was created to serve women in service-based industries who may not have access to capital (loans or venture capitalist funds). Barter Babes’ services include bartering education (what bartering is and how it can help an entrepreneur) and an online community of vetted, female business-owners who are willing to barter and network.
Whitney’s top 5 tips of effective bartering with other entrepreneurs:
Set a Price for Your Services
Before you pursue bartering with other entrepreneurs, understand the value of your services. Although no physical money is being exchanged, it is important to understand if the value of services by both parties are equal (or close to being equal) in value. If you find that your services are worth more than another party’s in your exchange, negotiate to see if the party is willing to allow you to barter a portion of the services and pay for the rest.
Understand Your Limitations
It’s tempting to barter all of your business’ needs; however, always remember that you must still pay in some way. Whitney recommends to conduct a maximum of 2-3 barter transactions a month but this can change based on the type and complexity of services you offer. Break down the number of hours it will take for you to complete a service and multiple it by the number of paying clients who use this service. This will give you an idea of how much time you have to offer parties for a bartering transaction. Understanding your limitations can help you avoid becoming overwhelmed and offering less than superior services to your bartering clients.
Reputation is Everything
Always barter with integrity. You should provide the same quality of services that you would provide a paying client because you do not want to earn a negative reputation. Bartering can open doors to referrals and can eventually turn a bartering party into a paying client. Additionally, only offer services you are absolutely comfortable performing. Be sure to leave a lasting impression so ensure that you are only providing services that will enhance and not hurt your reputation.
Create a Written Agreement
Once you’ve established the services to be exchanged, create a formalized agreement. The agreement should include a description of the services, timeline and completion date for each service, market value of each service (i.e. $1,200 for website design), consequences for incomplete services, communications guidelines between each party, and benchmarks to evaluate the quality of services. If there are any special stipulations or half barter/half cash deals, be sure to also include this information. A written and signed agreement helps establish guidelines and is helpful if one member of the party does not fulfill her obligations.
Understand the Law
Bartering is an activity that is recognized by the Internal Revenue Service (IRS). Consult with an accountant to track your barter transactions as they will need to be reported to the IRS during tax season using Form 1099-B. Whitney and Barter Babes are headquartered in her hometown of Columbus, Ohio. In Columbus, she plans to open a co-working space for Barter Babes members, equipped with childcare services for mothers who are entrepreneurs. That’s not all she has in store for her incredible platform; she also plans to launch a virtual bartering course that will be a requirement to complete before joining the network. Whitney wants women to be comfortable knowing that the women they barter with have the right training to conduct smooth transactions. Whitney started Barter Babes without a co-founder or team and quickly learned that it is a challenge to be a one-woman show as a lot of us can identify with. One piece of advice she wishes she had when she first started her business, Whitney says, “if you do not have a community of entrepreneurs around you, surround yourself with like-minded people who can understand what you are going through as a business owner.” The road of entrepreneurship can be a lonely one. “Many of my close friends are content with a 9-5 and could only empathize and not sympathize with my struggles in the beginning. I wish I had learned to surround myself with others as I was exploring entrepreneurship to learn more about the emotions and feelings that come with being a business owner.” It’s Whitney’s hope that Barter Babes can serve as a resource to help female entrepreneurs avoid feeling lonely or overwhelmed like she did in the beginning stages of building her business. Crediting God with helping her maintain balance in her personal and professional life, she thanks God for allowing her to stay motivated and giving my best to all my endeavors.
“Without meditation and prayer, and constant support from my husband and family, I would not be able to maintain and slowly take over the world.”