Driven by rising operational costs, increased patient demand for convenience and the need for financial security, many DCs in private practice are looking for ways to acquire more patients and conserve cash. Private practices find themselves fighting off new competition―indeed, even fighting for their livelihood, like many American businesses.
That’s where bartering comes in.
At a time when businesses (and individuals) have to stretch every dollar, bartering can be a strategic tool for saving cash while acquiring necessary resources without spending capital.
Classic system
Barter is almost as old as civilization itself. Wherever people lived in groups, neighbors who knew each other would barter or trade for services or items they believed were at least of equal value. That system can still work within communities, but most often both parties do not have a “like in-kind need” for one another’s goods or services. In other words, it’s difficult to make a match both parties want.
In this digital age, though, it’s possible to find bartering partners across the city or across the country. Through third-party barter exchanges—where members pay a commission for goods or services traded—more complex trades are possible. These digital capabilities are a factor driving a resurgence in bartering.
What can be bartered?
Just about anything. Advertising, printing, public relations, website creation and social media curation are popular in barter. In addition, people offer and seek services such as child care, home repair, cleaning, landscaping and computer repair, not to mention professional services of optometrists, CPAs, attorneys and, yes, DCs. Restaurants and hotels are also interested in barter to fill empty tables and guest rooms with customers they may not otherwise attract.
Bartering in the chiropractic industry involves the exchange of services for other goods or services instead of cash. It offers benefits such as increased revenue, a wider patient base, a way to market the practice and a method to provide costly care to patients who lack insurance.
Maxwell Barrett, DC, of North Shore Physical Wellness in Northbrook, Illinois, has been trading since he opened the practice in 2008. He likes that it opens up a new patient base who utilize him for care they might not otherwise get if they had to pay out of pocket. He uses trade dollars for a myriad of different expenditures. He has used barter for expenses such as advertising, landscaping, handyman services and office supplies. And he’s also used it to reward employees by treating them to dinner at local restaurants, purchase gifts or bought holiday goodies. On the personal side, he uses the services of other medical professionals like dentists and optometrists.
Bartering management
The best way to manage bartering today is through a barter exchange, most of which operate locally or regionally. Here’s how a barter exchange works:
A business lists a product or service for trade through a barter exchange. When someone barters for those goods and services, the business receives a trade credit, or “barter dollars,” based on the dollar value of the good or service offered. It can then use those trade credits to “purchase” goods or services offered by other members.
As a result, small businesses and sole proprietorships can use these channels to market to new customers and build a valuable network. The barter exchanges offer arbitration in the case of a dispute, and they keep track of the bookkeeping. This is important because barter transactions are considered taxable income and must be reported to the IRS.
DCs can thus obtain needed services or goods for their practice without spending cash.
Limits of bartering
Bartering turns downtime into a valuable commodity, but it shouldn’t form the basis of a practice. Barter should only be 3% to 5% of a business’s annual revenue; therefore, a business owner shouldn’t spend more than a couple of hours a week on these ventures.
Final thoughts
There are two more reasons to consider adding barter to your financial portfolio. They are less concrete but just as important.
Bartering encourages sustainability through the repurposing of goods and services, supporting the so-called “circular economy.” It also builds relationships and encourages collaboration among individuals and business owners who may not agree on anything else.
Mutual respect and trust are building blocks not only of businesses, but of our entire economic system as well.
John Strabley has been CEO of International Monetary Systems (IMS), one of the US’s leading third-party business-to-business barter exchanges, since 2011. IMS operates in more than 40 cities nationwide. Strabley holds the industry’s highest professional designation, Certified Trade Broker, and is a member of the Barter Hall of Fame. Contact him at 800-559-8515 or via imsbarter.com.
