Bartering
is not negotiating! Bartering is "trading" for a
service,
or for the goods you want. In essence, bartering,
bartering
is simply buying or paying for goods or services using
something
other than money (coins or government printed paper
dollars).
Thus
defined, bartering has been around much longer than money as
we
know it today. Recent estimates indicate that at least 60
percent
of companies on the New York Stock Exchange use the
principles
of bartering as a standard business practice. And
congressmen
barter daily to gain support for their pet projects.
U.S.
aircraft manufactures barter with foreign airlines in order
to
close sales on million dollar contracts. Perhaps you have
experienced
at one time or another in your life a friend saying,
"okay,
that's one you owe me..." Basically, that's bartering.
The
reason bartering enjoys renewed popularity in times of tight
money
is simply that it is the "bottom line" method of survival
with
little or no cash. In times of high interest rates, cash in
anyone's
pocket is indeed a very precious commodity, and
bartering
is even more popular. Bartering affords both the
individual
and the established business a way to hold onto cash
while
continuing to get needed goods and services.
In
addition to saving a business borrowing costs, bartering can
improve
its cash flow and liquidity. For anyone trying to operate
a
successful business, this is vitally important, and for
individual
families in these times, it makes possible the saving
of
cash funds for those purchases where cash is necessary.
To
start and successfully operate a bartering club, YOU MUST
THINK
IN TERMS OF A BANKER. After all, that's precisely the
reason
for your business---to receive and keep track of people's
deposits
while lending and bringing together other people wanting
or
needing these deposits.
So
your first task is to round up depositors. As a one-man
operation,
you can start from your own home with nothing more
than
your telephone and kitchen table, but until you get helpers
you'll
either be very small or very busy (probably both).
You
can run a small display ad in you local newspaper. A good ad
would
include the following ideas: NEW
BARTERING CLUB!
Trade
your expertise and/or time for the
merchandise
or services you need. We have
the
traders ready---merchandise, specialized
skills,
buyers too! Call now and register.
ABC BARTERING
(123) 456-7890
When
respondents to this ad call, you handle them just as a
banker
handles someone opening a new account. You explain how
your
club work; Everyone pays a membership fee of $100 to $300,
and
annual dues of $50 to $100. The depositor tells you what he
wants
to deposit, perhaps $150 worth of printing services, and
what
he's looking for in return---storage space for a boat over a
three
month period. If you have a depositor with garage space for
rent
and needing printing services you have a transaction.
But
let's say you have no "perfect match" for this depositor. On
your
list of depositors you have a dentist who's offering $500
worth
of dental work for someone to paint his house. A woman with
a
garage to rent in exchange for dental work for her children. An
unemployed
painter willing to paint houses in exchange for a side
of
beef, and a butcher who wants to trade a side of beef for
advertising
circulars.
Remember,
when a new member joins your club, he makes a deposit
and
states his wants or needs. In the above example, you have a
typical
bartering club situation. Your service is to spend or
line
up those deposits to match the wants or needs of the club
members.
An
affinity for people and good memory are vital to this kind of
business,
especially if you're running a "one-man show."
Generally,
when you have a buyer for one of your depositors, you
notify
him or her right away with a phone call. You simply tell
her
that Club Member A wants to rent your garage. She tells you
fine,
but she doesn't want any printing services. You simply tell
her
to hang on because you are currently in the process of
contacting
the dentist who'll do the work on her kid's teeth. And
so
it goes in the operation of a bartering club.
Some
of the larger bartering clubs (with several thousands
members),
simply list the deposits and wants or needs on a
computer,
and then invite their members to come in and check out
the
availabilities for themselves. Others maintain merchandise
stores
where the members come in to first look at the current
listing,
and then shop, using credit against their deposits. The
smaller
clubs usually publish a weekly "trader's wanted" sheet
and
let it go at that.
These
methods all work, but we've found that instead of leaving
your
members to fend for themselves or make their own trades, the
most
profitable system is to hire commission sales people to
solicit
(recruit if you will) new members, specifically with
deposits
to match wants and needs of your present members. These
sales
people should get 20% of the membership fee from each new
member
they sign, plus 3 to 5 percent of the total value of each
trade
they arrange and close. This percentage, of course, to be
paid
in club credits, spendable merchandise or services offered
by
the club.
You'll
need a club charter, a board of directories or officers in
many
areas, a city or county license. Check with your city or
county
clerk for more information on these requirements. You
should
also have a membership contract, the original for your
files
and a duplicate for the member. In most cases you can write
your
own, using any organization membership contract as a guide,
or
you can have your attorney draw one up for you. You'll also
need
a membership booklet, or at least an addenda sheet to your
contract,
explaining the rules and bylaws of your club. It's also
suggested
that you supply your members with consecutively
numbered
"club membership identification cards" for their wallets
or
purses. Some clubs even give membership certificates suitable
for
framing. You can pick these up at a large stationary house or
commercial
print shop.
Two
things are important to make up of the membership package you
exchange
for membership fees:
1.
It must be as impressive as you can make it.
2.
It must be legal, while serving your needs almost exclusively.
Basically,
you should have at least 100 members before you begin
concentrating
on arranging trades. As stated earlier in this
report,
the easiest way to recruit new members is to run an ad in
your
newspapers, and perhaps even on your local radio stations as
well.
Follow
up one these inquiries with a direct mail package, which
would
typically consist of a brochure explaining the beauty and
benefits
of being a member of your bartering club, a sales
letter,
and a return reply order form. After you've sent out the
direct
mail piece, be sure to follow up by
phone, and if
necessary,
make a call in person as any other sales person would
do.
Another
way of recruiting new members is via the Amway
Introduction
Party Program. Allow a certain number of club
credits
for each party a club member arranges for you. Insist on
at
least 10 couples for each party, and then as the "Attraction
of
the Evening," you or one of your salespeople give a
motivation-benefits
available recruiting talk. Be sure you get
the
names, addresses and phone numbers of everyone attending, and
be
sure that everyone leaves with your literature.
If
all those in attendance at these parties do not join, then
follow
up on them, first by phone and then with personal sales
presentations.
Once you've got them interested in your club, do
not
let go or give up on them until you have signed them as
members.
Another thing---take a page from the Party Plan
Merchandiser's
Handbook, and look for those who would be most
likely
to want to promote a similar party for you.
Offer
them an item of merchandise they might be particularly
interested
in, and club credits if they'll not only join, but
also
stage a party for you.
A
bit more expensive, but just as certain of success are free
seminars.
Rent a large meeting room, advertise in your local
papers,
and then put on a hard-sell recruiting show. Such a plan
is
very similar to the party idea, but on a larger scale. An
inside
tip: Whenever you stage a recruiting party or seminar,
always
"pad the audience" with your own people, who will of
course
lead the way for those you're trying to recruit.
As
stated earlier, you can start operations out of your home, but
working
out of your home has a number of growing inhibiting
factors.
After a certain period of time, the growth of almost any
kind
of business is retarded when it's operated out of a home. So
just
as soon as you can possibly can afford to, move into an
office
of some sort. Keep your eyes open and consider the
feasibility
of sharing an office with an insurance agent or real
estate
broker. Check your newspaper classifieds for businesses
willing
to share office space or rent desk space or other office
amenities.
This
is the kind of business that demands an image of success.
You
just can't keep people from "dropping in" when you're
operating
strictly on a local basis. And when you attempt to hire
sales
people, a place of business to work out of is just as
important
to them as how much commission they're going to
receive.
Image is super important, so don't neglect it!
Ideally,
you should have one salesman for every 50,000 people in
your
area. Run an ad in your local newspaper, and also list your
needs
you state's employment service. Hire ONLY commission
salespeople.
Give them a percentage of the membership fee for
each
new member they sign, plus a small commission on each trade
deal
they close.
Assign
each of your people specific territories, and insist that
they
call on potential commercial accounts ranging from the "hole
in
the wall" rubber stamp shop to magazine publishers and
commuter
airlines. There's plenty of business available in every
city
or metro area in the country. Encourage your sales people to
be
creative and imaginative when calling on prospects. Then, be
sure
that you keep an open mind and listen to their wild trading
proposals
(some "wild proposals have been known to become "wildly
successful)!
Schedule
"open discussion" sales meeting every morning before
salespeople
"hit the bricks." have each of them report on their
selling
efforts from the day before, and present to you a written
list
of prospects they plan to call today. Set up sales
motivation
workshops to be held at least once a month, and at
least
once a week schedule a motivational speaker or play one of
the
widely available success/inspirational tapes as a closing
feature
of your morning sales meeting. Stock sales success books
and
encourage your people to borrow them, take them home and read
them.
Your sales people will make you rich, but only if you turn
them
on and keep them flying high with personal motivation.
Should
you or should you not accept installment payments from new
members?
.Yes, by all means! But only when you've
got their
signature
on a contract drawn up for your benefit and deemed
legally
binding by your attorney. What about
bank cards? Yes
indeed!
In fact, you'll find that your capability of handling
bank
cards will double or even triple your sales.
Precisely
how much are you going to need in actual start-up
costs?
We would estimate at least $500 for your printing and
legal
fees, unless you can trade charter memberships in your club
for
these services. Time wise, you're going to be putting in
18-hour
days, and 7-day weeks until you get those first 100
people
signed. And there won't be any money for salary or
long-deserved
vacations from these first 100 members you sign.
You'll
need it all for advertising, membership packets and office
set-up.
However, if you can really work at it, you should be home
free
in six weeks or less. Then you can set up your office, hire
a
couple of girls to handle the paperwork, and take on a
salesperson
or two.
Reputation
and success in matching offers to wants will be just
as
important as image, so give it your all. Don't give up; stand
behind
the implied, as well as the real promises you make to your
members.
A
couple of final notes: Should you offer a guarantee of
satisfaction?
Only so long as it makes money for you, and you can
back
it up. There's not a person in business anywhere who enjoys
refunding
a customer's money. But don't forget that the existence
of
your business depends on service. The more you project an
image
of a "people pleaser," the greater success you're going to
achieve.
This is definitely not a business for someone who
doesn't
enjoy "waiting on" people. You've got to like people,
enjoy
helping them, and want the inner satisfaction that comes
from
selling new ideas.
This
is definitely a growth business. Bartering Clubs in
metropolitan
population areas of 300,000 or more are reporting
incomes
of over a million dollars. The average in cities of
100,000
population is about $150,000 per year.
Actually,
no experience or special training is required. The
operation
of a Bartering Club is equally suited to women or men.
Both
do equally well as salespeople. It's a business that fills a
need,
and a kind of membership program people will stand in line
to
be part of, once they've been introduced to the benefits.
This
is the plan. It's going to take your time and effort to get
organized,
but after your initial work to establish this
business,
you can become quite wealthy in a relatively short
time.
Read over this plan again; determine if this is "the one"
for
you, and then go all out. It's up to you, and all it takes
now
is action on your part.
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