When in doubt, trade it out

Grape,

I've heard that when negotiating a contract you should ask for things like clothes, hair and makeup since they're usually "traded out." What does that mean?


Ah, the trade out. It used to be the staple of broadcast stations that wanted get free stuff without opening the checkbook.

Basically, it's barter. I'll give your hair salon ten free spots per month and you cut the hair of my anchors. Same deal with clothes, makeup, health clubs, news cars, you name it. It is often preferred by stations that have a lot of unsold inventory (you can tell if your station runs a lot of public service announcements) and doesn't want to spend money on stuff. Businesses like unloading stuff they can't sell in return for advertising. That's why you often get bizarre gifts at Christmas parties.

Years ago it was more prevalent as the IRS didn't consider goods received as income. Then they cracked down and trade-outs became less popular.

Classic moments when I worked in radio: we had a GM that was the king of the trade outs. The guy traded for anything he could possibly get his hands on. Once he traded with a candy company for hundreds of chocolate rabbits. We were supposed to give them all away by Easter but we had so many of the things we couldn't. We had bunnies stacked to the ceiling. So after Easter people would be seen eating chocolate rabbits for lunch.

One day the GM hands his secretary a contract to type up. It's an advertising deal with a funeral home. She looks up at him and says, "Is this a trade-out?"