Arts Strategies, Barter, Bartering, business skills for artists, GYST, Negotiation, negotiation for artists, Negotiation Fox, negotiation skills, negotiation skills training, negotiation strategies, negotiation strategies for the arts, negotiation training, negotiation training for artists, negotiation workshops, persuasion
Barter is a method of exchange by which goods or services are directly exchanged for other goods or services without using a medium of exchange, such as money. Whether in your artistic career or in your personal life, bartering is a form of negotiation that can help you:
- Preserve cash – no or low out-of-pocket to get what you want
- Improve cash flow – allows you to preserve capital
- Weather periods of seasonality – survive slow business cycles
- Turn excess inventory into cash – if you have built up a large inventory of artwork, then bartering is a means to move some of it in return for things that you need
Here are a few things to be mindful of in barter situations.
1. Establish a time and/or money equivalent
In a barter situation, the two parties are not trading apples for apples. Therefore, in order for a win-win situation to exist, both parties need to find measurable, quantitative standards for exchange.
- If bartering for services, the standard could be a reasonable hourly rate for the parties’ respective services multiplied by the amount of time each of them will have to spend.
- Hard costs (cost price) could be another standard. Let’s say that you need a new refrigerator and the owner of the appliance store is willing to trade for one of your artworks. A comparison could be made between the appliance dealer’s cost to replace the refrigerator on his showroom floor and your cost to replace the artwork. In your case, that price would include materials plus your time to re-create it, and perhaps a gallery commission if you’re bound to pay it.
- Related to the point above, consider the distribution level at which each party is bartering. Some industries have multiple distribution/pricing levels, e.g., retail, wholesale, distributor, manufacturer, in descending price order. As an artist, you have one or possibly two, e.g., retail and gallery (wholesale).
2. Know the lowest price for which you can buy the barter item with money elsewhere
This may not impact your decision about whether to barter, but it will keep you from getting the wool pulled over your eyes if the other party starts to cite a unrealistic “retail price” as a standard of measurement
3. Know your own hard costs, but don’t be enslaved by them
If you are in a cash flow bind, or if your studio’s back room is stuffed with older works that you need to move out, you may be better off bartering below your hard cost – which is already a sunk cost – to get the things you need.
4. Don’t let others convince you to barter for things that you don’t want or need
If your best friend tries to convince you to barter an artwork for awnings for your house, because s/he owns an awning company, then that’s only a good deal if you really want or need the awnings. If you don’t, then don’t barter. Instead, negotiate with your friend over the price of the artwork and make an art sale!
When I worked in the corporate sector, I built up a huge number of frequent flyer miles from all the travel I was required to do. Those miles were of little value to me, because the only place I wanted to go was home. While a contractor was doing some work in my house, he mentioned that he and his wife were planning a trip to Spain. The cost of the skylight he was putting in became a barter transaction for two airline tickets! That was a real win-win.