January 20, 2004
Written by Bob Meyer, Editor of BarterNews
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"Brand Building" Through Corporate Barter
Corporate barter can, in addition to cleaning out non-profitable products that can put a drain on your company's cash flow, also help expand your marketing efforts.
Normally, one's ad budget has to focus on primary core consumers, but stretching to reach potential consumers is where corporate barter can be effective by serving as the basis for creating promotions that boost the brand beyond traditional advertising media.
It's accomplished by setting up a marketing insurance program between a manufacturer and a corporate barter company, with the objective of selling some product beyond what the company expects to sell.
With a proviso, that should conditions change and the additional product (sold to the corporate barter company) be needed, the manufacturer could buy it back at a favorable price. Such strategy is especially useful when launching new products or line extensions, because even million-dollar research studies can't guarantee consumer acceptance.
Another great way to foster brand identity, while maintaining the integrity of the core brand, is incentives. The company that gives incentives to its sales people is conferring value and gaining more brand exposure. And the corporation bartering the incentive merchandise gets valuable trade credits.
Corporations which don't do much advertising can benefit from a corporate barter vendor-trading program. It allows a company to utilize accrued trade credits to help pay trusted vendors for such things as packaging, raw materials and printing.
Extending exposure to geographic areas and market segments not currently penetrated, such as overseas distribution, is attainable through corporate barter without incurring the cost of additional staff and marketing support.
And, more and more, excess production capacity can be utilized to make private label products. Thus more income is derived to support the core brands, without causing image erosion.
Overall, corporate barter offers bottomline value while helping maintain brand image and worth—vital assets in the marketplace.
(This article was condensed from BarterNews Issue #54.)
U.S. Evolving Into A Free-Agent Nation
Last week in our "Here & There" section we noted that government employment statistics only survey big businesses, even though small business constitutes over 50% of the GNP in America.
We received an interesting letter from Michael Atler, President of Sure Payroll (www.surepayroll.com)...the fifth largest payroll outsourcer in the U.S. which includes small businesses.
He contends, and his data supports, that we are evolving into a free-agent nation where fewer and fewer of us are engaged in traditional employer-employee relationships. And more and more of us are offering our services to organizations as freelancing independent contractors.
Andrew Sum, the director of Northeastern University's Center for Labor Market Studies sees the same pattern. He believes that people are turning to informal contracting relationships, as an income source, more than ever before.
Atler says his small business clients indicate that their expanded use of independent contractors is based on their desire to manage their costs and enhance their organizational flexibility. Moreover, they indicate there is a better supply of talented freelancers available now than in previous years...and their fees are reasonable.
Editor's Note: Many independent contractors, offering valuable services, are available through the nation's trade exchanges. And there's no better way to utilize and pay for their services than at one's barter (variable) cost of doing business!
Peter Drucker Looks At Our Changing World
In the current issue of Fortune magazine, the 94-year-old guru Peter Drucker looks at today's changing world. Among his surprising comments are:
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