Corporate Barter for Disruptive Companies

Posted by Lua Cooper
financial_sense
28 2 2014

Corporate Trade or Barter is usually discussed in the context of a financial solution for well-established companies that have an issue with an excess or under-performing asset. These companies have a history of media buys, a product distribution pipeline, and other normal and predictable systems. For these companies, corporate trade is used to get more value from the asset while optimizing their media presence , increasing marketplace awareness through events or retail marketing activities.

However, disruptive companies, the ones that appear out of nowhere with a new product, can also use barter to their advantage.  These disruptive companies are competing with established companies, their own competitors, or both. As such, they have a wide variety of challenges:

  • Limited, if any, history of financial success or profitability
  • Need to determine priorities – constant pressure to determine if funds should go towards
    1. R&D
    2. marketing education
    3. manufacturing
    4. distribution
    5. consumer engagement
    6. lowering margin to increase exposure
  • Competition from “gorillas” in their related fields that can out-spend and out-wait them
  • Possible reactive legislation or negative response from various groups or associations

Many of these disruptive companies may not be familiar with the capabilities and advantages of partnering with a corporate trade company. Or they may think they’re not big enough.  However, using product to offset the cost of media is a savvy move, and one that would give them a competitive advantage. In addition, barter companies that offer other services such as experiential, provide a unique opportunity for creating consumer relationships while maintaining a cost advantage.

Disruptive companies have a small window to make big gains. Corporate Trade offers a financial solution that can help them get ahead of the competition – give us a call now to find out more.

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