Trade Your Business – Part 2 – Getting In Agreement

 

In “Trade Your Business” (show # 60) we “unbundle” bartering. One of the tools we identify that can help ensure that bartering helps your business – as well as prevents time-consuming and potentially expensive misunderstandings – is a bartering agreement.

 

Here are some of the key components that you should include in such an agreement: 

• Description of the product/service being exchanged
• The dollar value of the items/services being exchanged
• Acceptable substitutes (if any)
• Start date (if a service is being provided)
• Key milestones (if a service is being provided)
• Delivery date (or end date – if a service is being provided)
• A measure of quality
• Acceptable form of remuneration – if the bartering is not completed in the specified time period (e.g. returning a percentage or withholding work)
• Indication of whether the bartering contract can be transferred to someone else or held over to another date
• Sign-off by those entering into the agreement
• A signature by a trusted third-party who has read the agreement and has witnessed its signing

Going through this process is invaluable because it clarifies expectations and helps you identify those people with whom you do/do not want to barter. Of course, it may also highlight the fact that you may need further legal advice or that bartering isn’t right under certain circumstances.

 

Before your consider bartering as a good business tool to control costs, enter into new networks or dispose of unwanted inventory, make sure you listen to “Trade Your Business” (show # 60).

 

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