16 Sept 2007

Time Opportunity Cost

Any business that provides services is in a good position to barter. Why is that so? Their business is time based, and time is extremely perishable.
You cannot sell the service that you were offering yesterday. And that is why the old adage "time is money" or "time is more precious than gold". Electricians, plumbers, air-con service contractors can offer their services on full barter. Did you know how many independent electricians, plumbers and air-con service contractors went bust during the tough times of 2001 and 2002?
If only they had bartered their services, established a strong client base, some of these businesses would still be here today. Many business owners want to save their costs. If any business owner says otherwise is in delusion, because this is the one of the ways to increase profitability. If they're not interested in increasing your business's profitability, then they shouldn't even be in business in the first place. Service based businesses have time opportunity cost - which is cost that is intangible that most people tend to forget about it, as it is sometimes not realised cost. But when you look at it from a different perspective, it is time-revenue lost.