Tayo Solagbade’s
Performance Improvement IDEAS
(PI Squared) Newsletter
Monday 6th March 2017
NB: This PI Squared newsletter will be published weekly, on Mondays, in place of the Speaking/Web Marketing IDEAS newsletter, starting from today – 15th February 2016. I’m reinventing my Monday newsletter content and theme, to accommodate my vision of serving the growing audience of serious minded individuals and organizations reaching out to me, with information, education. news and research findings designed to help them do what they do better.
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PII 056: Resisting Use of Barter Exchange Can Cost You Business Success [Based on True Stories]
The message in this week’s issue of my Performance Improvement Ideas (PII) newsletter is based on transcripts excerpts from an audio podcast I recorded, to explain how business persons can explore alternative ways to get paid for what they do or what they sell.
Whether you’re a service provider, or manufacturer or producer of anything whatsoever, there are so many alternatives to getting paid in conventional ways that you can pursue, which will enable you to achieve the desired ends you want as a business owner.
However, in our part of the world – Africa, Nigeria especially – people remain very fixed in their thinking about how they should get paid, and even how they should pay people.
NB: There are certain groups, in Nigeria, that I’ve noticed actively use a lot of barter, though. E.g the relationship between journalists/media houses and outfits like hotels, restaurant/bars as well as conference/event centres. They do a lot of bartering with one another. The rest of us can learn a lot from them
People are so focused on getting cash. And if they can’t get cash, they close their minds to any possibility of doing business with the other party.
Unfortunately, the rest of the world continues to evolve and move on, because people in those societies are willing to accept that payment does not necessarily have to happen in cash.
What is important is achieving the benefit for which payment is desired.
What do I mean? I’ll give an example…
In 2009, I connected with a company in the Anifowoshe area of Lagos’s Ikeja. It was an IT company. They were into telecommunication, VSAT installations, fibre optics. They did projects all over the state and even beyond.
However they were going through a bit of a cash crunch when they engaged me to help them develop a Web Marketing System.
Now being a multiprenur, I do a variety of things – like building software, websites etc.
But this was a time when I was not yet operating from home, 100% online. I was still doing pavement pounding, driving my car all over the place, hunting for clients
Back then most of those I approached were generally not keen to pay for software or services, especially when dealing with an individual. So, one had to look for ways to make payment one requested not appear to be too big, in the eyes of the client.
So, one of the things that I learned was from studying the works of Burt Dubin. Through his Speaking Success System, over the past 3 decades, he has taught expert speakers, who are basically service providers that they should not deny themselves of opportunities to grow their brands, by being fixated on only getting paid with money.
Using the phrase “Barter is Smarter”, Burt emphasizes that you have to consider “Barter Exchange”.
You must be open-minded about how you market yourself, and how you get paid. If you don’t, you may lose opportunities in the immediate period as well as possibly miss those that could open up to you in the future, if you were more flexible in your thinking.
Let me give an example of the company I served in 2009.
I gave the MD a bill of N150k to develop a web Marketing System for them. He was a pastor with a popular Pentecostal church movement.
He wanted to pay N50k and I told him that THAT would simply not work. Instead I proposed that they pay N100k, with 50% of that being via a Barter Exchange.
In that regard, I told them about my Eyo Masquerade graphics design which I wanted printed on T-Shirts that I could give out as gifts or sell.
Since they had a new company division that specialized in transfer printing technology, I suggested they produce N50k worth of such printed T-Shirts for me. Long story short: he agreed.
And by the time I delivered their completed WMS to them 20 working days later, I got 75 nicely printed T-shirts handed to me as agreed, based on the costing we’d done.
It was a win-win outcome!
I have other true stories of how I used Barter Exchange to get paid what I wanted (see articles at the end of this piece).
Many times, the willingness to explore this kind of alternative payment option will enable you keep going even during hard times, when clients are hard to find and/or money is not easy to get from them e.g. due to harsh economic times arising due to recession etc.
And this is where I see lots of people sabotaging themselves effectively. When you want to buy something from somebody, even if the person is not proposing it to you – YOU propose it to the person!
Why?
Because it is in YOUR interest to spend as little cash as possible, to buy what you want to buy. So, cash is an option: YES! But even if you have the cash, you can still think of a better way to pay the person.
Find out what the person wants. What is the person trying to achieve? Try and interact with people. Go beyond what is immediately of interest to YOU in terms of what you want to get from the person.
Find out what the person’s purpose in life is. What are the passions of the person? What are the interests of this person?
Find out what they are , and based on what you discover, begin to look for how you can provide a solution for that person to achieve those things you know are important to him/her.
You can also find out how you can create a solution that the person would appreciate or value towards achieving those goals that are important to him/her.
Now, when you do that, it effectively puts you in a position where without cash, you can give the person something s/he considers valuable enough to pay money for.
So, for example if you have a business in which there are certain things that are kind of waste products you produce.
Again, I’ll provide an example.
I once visited a farm in Ibadan, Oyo state in Nigeria, with an old client working as a consultant but looking to retire into farm business – Poultry specifically.
This farm had maggots crawling out en masse on to the floor, from the poultry droppings pits under the battery cages in one of their pens.
The maggots were so many that when we were walking around, we kept hearing the crunching of their bodies as they burst under our weights.
They were having problems removing them as they had to pay extra for that to happen along with the droppings removal.
What the owner eventually did was to invite a worker he had on the farm, who also happened to have a catfish farm business of her own, to pack the maggots away, at zero cost to him.
While we were there, within about 15 minutes she had packed 2 twenty five kilogram bags filled with maggots!
And maggots were still all over the floor. For her however, this was pure protein for her fish – something that would have cost her a hefty sum to provide if she had to buy it. And if she chose to rear them the work involved would have been considerable.
There are many opportunities for barter exchange in the kind of situation described above.
Most people who have fish farms would love to get hold of such maggots and feed to their Catfish or Tilapia.
Some people would go to great lengths (even pay money) to get large number of earthworms to feed their female catfish brood stock preparatory to spawning (reproduction via induced breeding).
So if I owned a poultry farm and a restaurant business, I could think, for instance, as follows:
Can I use the poultry droppings from my farm to generate a bank of maggots that I can then begin to give as alternative payment to somebody who runs a catfish farm and sells fish?
WHY?
Because I want to buy fish for use in preparing dishes for my restaurant. I want certain quantities of fish I want to put in my restaurant freezers. But I don’t want to pay for fish. I want to be able to give him say 10 bags of maggots that will amount to giving them 100% protein to feed his catfish.
And I would get in exchange X kg of that I can use in my restaurant.
With the above opportunity, every month that I have to spend, say N10k to buy fish for the restaurant, I find that I am able to drop that bill to just N2k, because I have someone supplying me LIVE fish in exchange for my providing him/her maggots to feed his/her pond fish.
Begin to think of yourself as a solution provider for the person you are going to buy something FROM!
In other words, apart from giving your money to the person, think of how you can give him something else that will make him decide to either give YOU money or better still, not need to take money FROM you!
Once you can spend less to get what you want, you will be able to retain more of the money you make as profits.
So, if for example, you have a budget today of say N10k, to advertise in a medium. Consider approaching the owner of that medium to propose a workable barter exchange arrangement, that can enable you spend less than N10k, so you have more cash to channel in other areas that may not lend themselves so easily to payment in kind via barter!
Simply put, there are various options you can explore to make use of the ideas proposed here. The most important thing is for you to maintain an open mind like an umbrella.
Otherwise, you risk making yourself lose valuable opportunities to grow your brand, when you don’t have the cash to take them up.
Closing your eyes to the barter alternative can also make you end up missing out on opportunities to connect further with people.
This is because when you close your mind to the option of barter exchange, it means you won’t be able to continue with that person.
No cash? No barter alternative? You will be left with nothing to do but go your separate ways!
But if you are able to use the barter exchange alternative to continue the relationship, you might get to a point when money will now come on either side (yours/his/hers/theirs). And you’d be able to then continue your business dealings using money that you previously lacked as a basis for interaction.
That would only however happen because the relationship continued/was maintained via barter exchange when there was not enough money to keep it going.
Final Words
Based on the above, it becomes apparent that if you give people an option to do business with you through barter exchange, you can create an opportunity for long term potentially profitable relationships to be built and maintained.
I urge you to keep THAT in mind whenever you find yourself in situations similar to any of those I’ve described in this article!
Related Articles
1. Barter Your Digital Products to Make More Money (True Story)
2. No. 175: Why Speakers Who Barter Products and Services Will Make More Money
3. No. 226: Products and Services Bartering Can Make You More Money! [True Stories & Research Proof – from Harvard & Others]
4. No. 194: How A NEW Client Paid For My Website! [Why “Bartering” Can Help You Sell More – True Story]
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