This article is geared toward my fellow freelancers, business owners and those who may end up doing trade for their business services and products.
As an entrepreneur who provides technical and creative services, this affords me the ability to do trades from time to time. I have learned quite a bit along the way of when trades pay off, when they don’t and when to break ties. Honesty is key in all of this, both from you and the other party. If someone is interested in providing something for your services in lieu of money, make sure you receive like-kind value for your expertise and those of your team.
THE BAD – TRADE FOR SERVICES
If your agreement is to trade dollar for dollar services or products, get it in writing…this has been my biggest mistake. There are two ways to compute the trade value. One is to do retail value trade or at cost trade. Once you figure this out, make sure the other party is upholding their end of this agreement. I had the ‘at cost’ arrangement with a company and trusted they were upholding their end of the bargain. When I needed a particular product I had a trade for and didn’t want to drive down to the company location, I found a local retailer and figured I’d be paying an arm and a leg for the discounted trade product. Turns out they were charging me full price when I was offering them services from my team at cost. I’ve provided thousands of dollars of web design services and programming and received often times 2x less than the value because I didn’t get it in writing. What happens if one party can’t fulfill the remainder of the trade and you’re left hanging? Where is the compensation?
Keep track of your trade time/services and products. I have eaten it quite a few times taking things on faith and not getting the value I put in for the work I’ve accomplished.
THE UGLY – TRADE FOR SERVICES
Beware the person who wants to pawn off undesirables or hard sell items to you in lieu of your services. I had one company do trade for an item that I learned wasn’t at all what I initially requested 11 years ago. This same company just recently approached me 11 years later to do another trade with them and implied their DAMAGED GOODS would be offered. When I didn’t accept this as a possibility that would work for me, they blew me off. A blessing in disguise. If someone is dishonest…I mean like deceptive, this is someone you don’t want to have a trade relationship with.
THE GOOD – TRADE FOR SERVICES
So, I don’t’ want to dissuade you from trade relationships, because there are actually good and sometimes great trade for service relationships. One of which I’ve had going for the last 6 years. Yes…SIX YEARS! The business owner is the epitome of a strong moral character. Realistic, appreciative and honest. Our agreement has had absolutely no negatives and value is provided for both of our companies.
Looking Foward
- Have realistic expectations.
- Write down your agreement and both of you sign and date.
- Build in a provisional clause in case the trade cannot be kept up from one party.
- If it doesn’t feel right don’t do it.
