December 9, 2003
Written by Bob Meyer, Editor of BarterNews
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Teacher Turned Entrepreneur Used Barter To Get Business "Off The Ground"
Nora Christensen wanted to start a cooking school, but her $2,500 in seed money wasn't enough to lease the space and buy the equipment she needed.
So the teacher-turned-entrepreneur came up with a work-space recipe: She struck a barter agreement with a company that gave her the use of a commercial kitchen in exchange for her meal-preparation skills.
The arrangement developed when Christensen responded to a newspaper ad. Bodine Electric, a motor manufacturer in Chicago, was looking for a vendor to operate its employee cafeteria. She arranged with Bodine to use the company's kitchen facilities to make lunches and dinners for its 500 employees.
With the help of a cook and a dishwasher, Christensen provided Bodine's employees with gourmet meals at a guaranteed price per entree that was about the same as the cost of a fast-food meal.
In return, she got exclusive use of the kitchen when she was ready to open her cooking school.
After a year, she was able to open the Cooking Academy of Chicago which now has scores of students. Under Christensen's supervision, they learn by preparing the meals for Bodine's employees. The academy also does catering for other local businesses.
The arrangement with Bodine enables her to keep tuition to about half that of other area culinary schools. Christensen's school has been profitable since its first month, plus she has been able to upgrade equipment and use an adjacent room to create a second kitchen.
Her advice to other companies with bartering arrangements is to maintain constant communication with their partner companies, and to speak frequently to the direct beneficiaries of their services.
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A look back at two barter success stories from issue #41:
Nation's Largest Provider Of Radio "Traffic Reports" Was Launched Using Barter
Metro Networks, the creation of David Saperstein, delivers reports to more than 1,300 radio stations and 114 TV stations. The idea for traffic reports stuck Saperstein while in a Baltimore traffic jam in 1978.
At the time he was a Ford dealer, and figured he could get free advertising for his car-lots if he assembled traffic reports and offered them to radio stations in exchange for air time.
Within a month of his brainstorm he had signed up three stations and two traffic reporters. As payment, Saperstein asked for ten seconds at the end of each broadcast.
Today stations pay him a mix of cash and air time, which Saperstein resells to national or regional advertisers.
When he built his $3 million home in Houston's posh River Oaks neighborhood, local legend has it that he was so good at bartering radio time for goods and services that you could tell what stage of construction the house was in by the ads that ran on Metro's traffic reports—from roofers to pool men to electrical contractors.
Investors Used Barter To Revive Company Crippled By Scandal
In Southern California a bus-shelter company faced almost certain oblivion when a "Ponzi" scheme forced it to seek bankruptcy protection, threatening to wipe out more than $45 million from investors.
Today the company is profitably growing, and has been paying back some of the money its investors lost in the scheme by the founder who went to prison.
This success story is a result of an unusual show of unity, support and cooperation by the investors, who persuaded a judge to allow them to draw up their own reorganization plan.
After the reorganization was OK'd the investors turned to barter—putting in almost $500,000 worth of labor and services to get the company moving in the right direction!
Four dozen of the investors drove to every bus shelter in California and Las Vegas—cataloging the shelters' conditions and the advertising on them.
A 72-year-old former military car-pool mechanic maintained the repair trucks and sales cars, while another mechanic fixed the air conditioning at the office. Others brought food for employees.
Without having cash on hand to pay for labor costs, they worked together to handle the multiple mailings to the 1,185 investors. All the legal costs were on trade, as well as help with the daily operations.
In all, it was a team effort—trading time to revive the company and creating the opportunity to collect on a long-overdue investment.
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U.S. Economy Becoming More Entrepreneurial
According to a recent report in The Wall Street Journal, self employment is boosting the economic recovery. Investment strategist Kenneth Safian says he has found evidence that small enterprises really are playing an important role in the recovery.
The evidence is buried in the government's monthly personal-income report. Proprietors' income, which is the income earned by individuals from running their own businesses and from partnerships, is surging...up 8.6% from a year earlier.
Mark Zandi, chief economist with Economy.com, says the state of Delaware reported a 14% increase in the fees it collects from individuals applying to register limited-liability companies. "You can use Delaware as a window into whether the entrepreneurial spirit is being revived or not (around the nation)," he contends.
Today proprietor's income is taking on a rising share of total national income, now at an annual rate of $822 billion, according to the Commerce Department. It is based on Internal Revenue Service tax returns from individuals and business partnerships.
This entrepreneurial figure now accounts for more national income than the entire manufacturing sector's wages and salaries. And it's just shy of the wages and salaries earned by government workers.
Check Out The 29 Informative Articles Listed In Our "Trade Exchange" Section
Learn how to use barter to reward and motivate your employees, or to assist your most valued customers. See why your company's team of professional advisors should include a barter expert. And check out the ten ways barter can help you build greater assets, plus much, much more!
To read any one or all of these interesting articles see "Barter Categories" listed on the horizontal navigational bar at the top of our web site, and then click "Trade Exchange" on the drop-down menu.
Autumn Trade Fairs & Holiday Expo's....
December 14: TradeAmericanCard's 2003 Barter & Business Expo will be presented at The Grove of Anaheim. For more info: (714) 532-1610.
(Send your "holiday fair/expo information" to: firstname.lastname@example.org)
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