Unlocking New Revenue: How Blending Trade and Cash Transforms Business

Trader Stu shares strategic approaches for blending trade and cash to maximize business revenue and expand customer reach with real-world examples from new members. 

• Combining trade with cash transactions creates a powerful marketing strategy that preserves cash while driving new business
• Birch Run Speedway uses trade for ticket sales while keeping concessions, merchandise, and sponsorships cash-only
• Customers who attend events on trade often spend more cash on-site since they perceive their admission as "free"
• Filling otherwise empty seats or appointment slots with trade customers brings in additional revenue with no incremental cost
• Salon example shows how to accept trade for select services (red light therapy, facials) while keeping high-cost services cash-only
• Trade clients often become loyal cash customers and refer others to your business
• Consider trade as part of your marketing budget, not a replacement for cash sales
• The strategic approach works for nearly any business with unused capacity or perishable inventory

Check out Michigan Renaissance Festival next month in August!

The Michigan Renaissance Festival
Experience the Michigan Renaissance Festival, where history and fantasy collide!

Chapters

• 0:00 Introduction to Trading Post Podcast
• 0:47 Blending Trade and Cash
• 4:22 Benefits of Selling Tickets on Trade
• 8:17 Converting Trade to Cash Revenue
• 14:28 Salon Services Hybrid Model
• 18:28 Key Takeaways for Business Growth

Transcript

Speaker 1: 0:02

Hello and welcome to the Trading Post Podcast, where we unlock the secrets of business-to-business trade, dive into powerful networking strategies and share my exciting journey of using a podcast to market my business instead of relying on SEO. I'm your host, trader Stu. Hello and welcome back to the Trading Post Podcast. I am your host, trader Stu. Of course, this episode is sponsored by Metro Trading Association and the Michigan Renaissance Festival coming soon Next month, actually August. I'm excited. Be sure to check that out.

Speaker 1: 0:40

I want to get right into it today and talk about a couple of things about blending trade and cash and the reason why I say that I just happen to have signed up. My two last members or potential members or future members that I signed up because they're not officially in the system yet. Just say it like that. Anyway, there are new up and coming members and one of them is the Birch Run Speedway. Of course, it's kind of like, if you're around the neighborhood that I'm in, we call it Dixie Motor Speedway. As a matter of fact, I think their caller ID still says that when they call in. That's just what I grew up with. They're the figure eight bus track in Birch Run, where it's always fun to see them intersect and smash in the middle. It's kind of like a derby. And then, of course, if you're in the area, it's always like Pine Knob. They called it DTE Energy Theater or something like that for a while, because DTE bought it, but everyone the old school folks, just called it Pine Knob and could never convert and acclimate over to DTE. So to me, if I say Dixie Motor Speedway, I'm talking about Birch Run Speedway. They just got new owners or something like that and changed the name, and then I also signed up a salon.

Speaker 1: 1:45

So I want to use both of these as an example of how you can leverage trade or barter credits for additional cash. Now I found both of these, these establishments, on a platform called Tease the Deal, and basically they're advertising for business, right? So what is trade all about? Bringing additional business that you wouldn't otherwise had. So I was like, well, I'll give them a call and the first thing they can say is no, and they both said yes.

Speaker 1: 2:15

So one thing that I wanted to mention about the Speedway is that they will take trade. So what we're gonna do is like what we do at Michigan Renaissance Festival we buy trade. Are the tickets up front and Erebus to the Haunted House in Pontiac that's, I think, in the Guinness Book of World Records. We buy both of them up front and we sell the tickets for them. So let's just say we buy I don't know $1,000 worth of tickets at 20 bucks a hitter I can't remember what it was, but just using numbers and then we'll then turn around and sell that. But the benefit is that they'll get the trade, you know, upfront and then we are now in charge of offloading those tickets for them. So it's a win-win for them. We're literally their sales and marketing team that they don't pay for until well, actually they get it up front, which is rare doing tickets like that. So Speedway doesn't mean the same thing. So we're going to buy. I think they charge $15 per seat. All right, we're back.

Speaker 1: 3:12

I'm actually recording this at work and the phone rings, so I had to go ahead and grab that. So anybody who's out there trying to use podcast to help generate additional business you don't really got to take off. You know extra time and be time away from the time of family and kids Do it at work, hit pause when the phone rings and continue on your way, right. So, at any rate, what I was saying was that blending trade and cash is that it's a two tiered approach and that you can take your trade on tickets but then you're going to get cash on food, drinks and even merchandise. So, like in the way of Arabist, they sell swag. You know, on cash you can't buy hats and t-shirts and sweatshirts on trade. I don't think they sell food or drinks, maybe they do, I think they do, anyway, it doesn't matter. And then of course, at the Speedway I think they have beer and drinks and of course you know swag. So there's that. It's kind of like I don't say it's a no brainer, it sounds kind of rude or whatever like that, but I think it's a no brainer and we'll get into the salon here in a second too on what she does.

Speaker 1: 4:13

So a couple more benefits of selling tickets on trade. So it fills the seats with new customers when they move in. With trade you tap into the untapped barter market, filling otherwise empty seats and there's no incremental cost, but you do get a larger audience. And then of course, you reach a network of barter members to introduce your venue to them and individuals outside of your typical circle, driving a lot of first-time visits and new relationships, because everyone in the barter system is our business owners essentially right, and then of course, that preserves their cash reserves. So instead of advertising, spend or doing deep discounts which is where I found the Speedway it's kind of like a Groupon, but a local Groupon that we have around here in the metro area they now get full price, full value for their tickets on trade and it uses up their spare inventory or their empty seats, because I mean, I've been there a lot of times and I don't think it's ever been a full house Like you can't sit down anywhere.

Speaker 1: 5:16

You know what I mean. You gain new customers and you keep your cash in the bank for other expenses. So your cash, I always say you know, save your cash for things that you can't get on trade. So power, gas, whatever your utilities, and maybe payroll things like that. But your barter, you need to think about if you got advertising or you need to get maybe I don't know plumbing, electrical, seal coating, if they have it paint, striping, stuff like that. Look at trade first and then you'll get that. You know, save that cash in the bank for other expenses. So think of trade and then barter and then down the line cash right. So we'll trade and barter.

Speaker 1: 5:56

I say it one of the same. The reason why I go back and forth. I just people say it. We're called Metro Trading Association, so it's trade. But when I say trade, people think I'm in the stock market floor in New York City. And then when I say barter, they think of you're trading services without getting paid. You're just like one for one. So like, let's just say they're like oh, I don't need whatever you know, bananas for my tickets for Speedway. I have enough bananas, I don't need to barter anything. I'm like no, it's not the same thing, it's like a hybrid approach. It's B2B barters like trade.

Speaker 1: 6:31

So attendees who get in on trade are less likely or more likely to purchase concessions. Right, because they've got their tickets. They feel like they're getting in for free, even though they're not, because they traded their services for it. So they're getting this ticket basically at their wholesale cost. They're going to probably spend more there and then that'll generate more direct cash revenue For many venues. The margins on food and beverages, of course, exceed the ticket profits.

Speaker 1: 6:57

We all know that about movie theaters. Why movie theaters right now? Why can't sign them up? I know why because they're corporations. But I should be able to sign up every movie theater in the area on trade. It doesn't make any sense not to, because they don't make any money on the ticket sales. It's all about the popcorn pop and candy, right? So of course, hey, guess what? You'll get more word of mouth and return on your business. So, barter, visitors who have a great experience will recommend your event and then they'll potentially return and bring their guests, friends, family or whoever who will pay cash next time, because, guess what? They're not trade. So they're going to tell people like, oh man, if you've seen the bus races or the Derby and on Birch Run, you should go. Of course, everyone knows word of mouth. Marketing is the best, referrals are the best. Boom, you're going to get more. You know, seats butts in seats that way. So it's a win-win for cash flow. There's no risk of cannibalizing your core revenue.

Speaker 1: 7:55

By segmenting which products are sold via trade, you protect your core business cash assets while leveraging your spare capacity for marketing and reach cash assets while leveraging your spare capacity for marketing and reach. Like I said, the best way to use your trade dollars for these guys, I think, is going to be for more marketing. Turn trade into cash indirectly, even though your tickets are fulfilled in trade. Every attendee becomes a cash customer once they're in the venue. Like I said, there's your concessions and then I think, the drivers, the pit crew, also sell things too, you know, to help fund things. But then you get the networking effect which barter guests. Often they're business owners, right? Like I said, they're professionals, prime candidates for group booking, sponsorships and future cash deals, because I thought about that too.

Speaker 1: 8:40

If we can get them to accept some trade dollars for banner advertisements out in the circle, like out in the racetrack, or even maybe sponsorships, I'm not sure how that whole gig works, but like it's funny, a funeral home, I know, is one of the sponsors there. I'm like, it just seems I don't. It seems like a bad karma, like having a funeral home, you know, sponsor a high-risk sport. To me I'd be like, instead of Red Bull sponsoring all these skydiving things or, you know, these high-risk adventures, it's like here's a funeral home, it's a genius idea, but anyway, what else?

Speaker 1: 9:16

Here's some pro tips for venues and the event planners, if you're listening. Set trade ticket limits. Get the cap number of tickets available via barter to prevent diluting your regular audience and keep events feeling exclusive. So I mean, obviously they're going to sell me so many dozens or hundreds of tickets per season, I imagine, and we'll go from there. You promote your concession specials so you encourage your higher cash spend at concessions with exclusive deals, combo offers or a trade night special. That's a good idea. And then track and upsell barter attendees, collector email info when they read dino tickets that encourage the repeat visits and cash only incentives and then clear staff instructions. Each staff should know which ones barter and cash what. They don't got to worry about that because the salon owners that is owner and then the trade. Everyone at the track isn't going to have to know the difference between barter versus cash.

Speaker 1: 11:10

So talking points and conversation starters how trade brought tickets into the cash at the snack bar is one thing that the members that are going to be there might think now, right outside the box, like man, I don't even think about at my own establishment, whatever they do, let's just say they're in Arcade and let's just say, oh, you know what. Let's say they're with a friend and they own Arcade, like, for example, let's just say Dave and Buster's. This is a good example. Supposed to say Dave and Buster's, right, this is a good example. I could sell, maybe like 50 credits on trade to get a card at you know the arcade. They pay nothing for that because they already own the machines, let's just say, but they're going to get cash for the beer and pizza sales. Boom.

Speaker 1: 11:56

You know, sometimes it takes a little extra just to think outside the box and be like how can I leverage this to get more cash? Right, you're gonna, of course, pack the stands or your business. It'll boost your cash registers, and letting inventory go unsold is more expensive than trading for new customers. Well, I already said that, because if you're gonna lose the inventory, if you already bought the food and it gets thrown out, well that sucks. You might as well get some barter for it. Barter bucks, right. And then, of course, you network your way to cash sales, one barter kick at a time.

Speaker 1: 12:32

The guy who owns this place owns car dealerships, so he knows all about that. There's plenty of venues in the country that use this exact model. Prevents the cash flow, keeps seats filled and then boosts overall revenue, and especially during off-peak times for less popular events. There's another point there too. If you have an off-peak times, you know it's a great time for me to send us an email and say, hey, can you promote this one, because they think they're going to have maybe some low seat numbers. You know, it's a great time for me to send us an email and say, hey, can you promote this one, because they think they're going to have maybe some low seat numbers. You know, of course, the more people in the stands there at a situation like this, the more energy, the better the drivers are. Maybe I don't know, but either way it's a win-win.

Speaker 1: 13:15

So another one I wanted to talk about real quick I got a few minutes left is the salon. So she said she'll offer a trade for services like she's got a red light therapy booth which is kind of like a tanning bed. It looked like, but they use red lights instead of UV lights. She has an IV vitamin drip so you can go there. You can get hooked up with a bunch of like different you know, vitamins, magnesium, whatever you're lacking. She'll also do waxing. They do, I think, from head to toe waxing, eyebrow threading and she'll do facials on trade.

Speaker 1: 13:54

But she can't offer the weight loss services that she has or the supplements, because the profit margin I think she said just is not there Because, like I said, we do charge a percentage to bring people in and it's also very expensive for her. I think she said her average ticket for the weight loss service is two grand and so that'd be a big hit for her. I don't know what her profit margin is on that, but she wants to start out small. But I said, don't worry about it, and here's why I'll tell you in a minute She'll get more traffic into the establishment and here's why I'll tell you in a minute She'll get more traffic into the establishment and she might have otherwise had that without me bringing them in on trade. So If they're a local salon and they're a small business and many are, and we have had franchise too, salons the hybrid trade model will boost her business and here's why she accepts the trade for select services. Like I said, she'll do the red light therapy of vitamin drips, waxing, eyebrow threading and facials. That excludes the high cost low margin items like due to the profit margins, weight loss services and supplements that she can't take and that remains cash only. But she'll boost the foot traffic in there by tapping into the barter network reaches new customers and new groups of clients who may not have otherwise visited.

Speaker 1: 15:06

People will drive for trade. They just will. And you got upsell opportunities. And that's what I was getting at is that once the clients are in the door for a service on trade, they'll more likely learn about and potentially upgrade to the salon's exclusive weight loss programs and products for cash sales. So while they're in there, like, oh, we had this, like I don't know, fish oil pill, I don't know. You know you should take this and it's 20 bucks for the bottle, but we can't take the trade on it because I whatever. So, yeah, okay, well, maybe they're already there and it was by the $20 bottle on cash, that'll maximize her revenue per visit. So that owner now leverages trade as a marketing tool which is what I've always said it should be and you use it to turn your unsold appointment inventory time into growth opportunities and cash transactions.

Speaker 1: 15:53

Like I told her on the phone, I said look, if your red light therapy booth isn't being used, if you're open from 9am to 6pm and it's not on all the time, you're losing money, right? You don't get that time back. So let's throw some extra people in there and keep the lights on, and more than one way. I guess you could think about it. But yeah, you know, I just kind of, I just have fun with it. So she's like, oh yeah, that's a really good idea. Why not If the booth's not being used? I mean, that's time, I'll never get back. Boom, we'll throw maybe some barter folk in there and then done so.

Speaker 1: 16:31

A couple of key takeaways on this one Selective trading allows service businesses to protect their bottom line while increasing revenue exposure. So, anything in the services industry anybody, I think anybody if you are not booked out three months or whatever, you need to consider taking a trade clients here and there to keep your door spinning. You know, especially services, because all you have is usually in services is your time and knowledge. I say it again, I hate to say it it's a no-brainer. It's a no-brainer because if you're an electrician and you're not wrenching constantly on something that's electrical and making money, you need to take on some trade clients. Consider it, don't consider well, I need cash. Put trade into your marketing bracket If you have. I say I spend 10% on marketing out of my revenue. I go right back to my marketing budget. Your trade needs to be part of your marketing budget. And then here's what's funny about that your marketing budget will now become into your trade budget because you can buy marketing on trade, so.

Speaker 1: 17:43

But a lot of people just can't think like that outside the box. They they're trying to replace, you know, cash with trade, trade with cash. And well, I need to pay my bills, I got to pay my employees. I'm like, yeah, but aren't you advertising? Oh yeah, okay. Well, instead of spending a thousand dollars cash on marketing, spend whatever $500 a month cash and then 500 trade, because you're going to get money in trade. So it's a win-win, win-win-win-win.

Speaker 1: 18:16

Also, one thing to think about is that trade clients become loyal cash customers, and that's because with the right upsell strategies, it's a stronger in-person experience than seeing it online, and you got to think about that too. Trade clients also will kind of automatically become loyal customers, because the way trade associations work is that they only allow so many types of one kind of business in a certain area. At least they should, unless it's restaurants. Well, I don't know, maybe even accept restaurants, because if you got two taco joints, I probably wouldn't want to do that if they're across the street from each other or neighbors, you know what I I mean. So I would give whoever signs up first boom and then, if they're, if they ever say you know, I got, I'm too busy, I can't take any more trade. I'm like, okay, well, sign up your neighbor and then boom, you know, now that's how you get two taco places in the same area or whatever. It's an example. But generally business owners of restaurants will refer the other business owners that they know, friends or whatever, or networking partners, because they don't sell the same thing. Like I just had one of our clients refer another client.

Speaker 1: 19:24

But one guy is a bar who has arcade games and it's called One Eye Jacks and what do you call it? Not horseshoes, but bean bags, cornhole, he's at cornhole tournaments and I said, hey, you know, would you recommend if I had this guy call you from Rosita Streets who does like empanadas and you know he's got oxtails and plantains, dude, oh, the plantains are awesome there. If you ever go there I think it's on Van Dyke and 23 Mile or something like that off the top of my head you need to get the plantains. Oh, my God, awesome To die for. So that's why I signed him up, actually because I found out he had plantains. Like, you got to sign up, dude, you just do Because you have plantains and I want plantains. On trade. He's like, okay, and then actually, what's awesome is that he immediately took me to his neighbor, who happens to be a taco joint. I say taco Mexican joint, mexican restaurant, and he said, hey, man, you got to sign up for this. This is a great idea. And the guy was like literally I interrupted him in the middle of construction. So he's like, yep, sounds good, like I'll be with you, like get a hold of me in a couple more months, because I just can't right now I'm still setting up, my shelves are empty, I've got no customers yet and you know I need to get some money first. I'm like I'll get it. So actually, oh my God, I forget to follow up with that guy. I forget to follow up with Rosita's neighbor. Okay, anyway, so that's why you talk out loud sometimes, because I get so busy with everything, I'm like, oh, whoops, I didn't get back with that guy. So I think it's been long enough. He should be open. He should be getting business in the door anyway. So we'll see.

Speaker 1: 21:00

What else can we talk about here? The model. This model can be adopted for a lot of different kinds of different businesses. Focus on what you can offer on trade to drive the interest and then keep up your high margin inventory sensitive offerings that are a cash exclusive. So a lot of things have low markups, right, but you get what's called, you know, loss leaders. So like, for example, costco, their loss leader is chickens, those rotisserie chickens. They should just take those on trade and then bring people in the door. And I know I can't get Costco on trade. That'd be a dream come true, holy crap, that'd be awesome.

Speaker 1: 21:37

But what else? Oh, my grandpa owned a drugstore. His milk was, I think, a loss leader, he said. When he had sold gallons of milk, I think he said it either broke even or came out slightly negative to beat everybody else in town. But that brought people in the door to buy the milk there, to grab maybe a few other things while they're there. He also had a restaurant in there. He also, of course, was a pharmacy. So you know it was a really nice drugstore, way cooler than like CVS or. You know, all those guys are out of business but and I sadly enough they came in, put them out of business, bought the drugstore, then turned it into a parking lot, it leveled it, put up a brand new building down the road and now that one's empty because they're out of business. Crime shame, anyway. That's why you diversify portfolios. You know you got big players and then they I digress Anyway. So I hope you enjoyed that.

Speaker 1: 22:35

There's some examples on how trading associations empower members to grow smartly, using flexibility and creativity to do that for you. And you know, like I said, think outside the box. You're thinking of trade. What can I offer on trade and what can I maybe hold for cash? Let me use trade to bring people in the door and use it for marketing and then that way you get more work. So you have to forget, don't forget.

Speaker 1: 23:00

We do a lot of advertising for members before they even pay us. We do the text blast, the email blast. We've got brokers that make phone calls for all our new members. We'll go around once a week. We call. You know we're trying to hit everybody and we'll do emails or texting because you know everyone's so busy because they don't have employees anymore. But they'll say hey, did you hear we got the? You know, dixie or not Dixie? See, I did it.

Speaker 1: 23:22

Bertrand Motor Speedway they're taking trade for tickets. Would you like some for this weekend? They have Mechanical Mayhem 2 or something like that is coming out this week and I'm pretty sure that sounds like we call it the Destruction Derby or Construct. I think it's a Destruction Derby. I think it doesn't matter, but I digress. So, yeah, you know. Anyway, keep your mind open. Think about trade in your area. If you are looking at it and don't necessarily take it as like all or none, maybe use it for a little bit. A ticket sale, a cat, do gift cards, bring people in the door, you get the breakage. Boom. You know, if they don't spend all the money, you get the breakage. If they spend more, then guess what? That trade association just got you cash business because they overspent their trade certificate and now they got to pay the rest of it in cash. That's it for now. Whatever you do out there, y'all.