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How to Barter to Save Money Without Running Afoul Labor and Tax Rules

Here's what your business needs to know about volunteers and paying in barter.

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This story appears in the June 2011 issue of Entrepreneur. Subscribe »

When Rebeca Mojica, owner of Chicago jewelry company Blue Buddha Boutique, announced on Facebook that her shop was moving, customers responded, "How can we help?" and "I love to pack boxes!" That enthusiasm led her to "hire" three customers to help staff a booth at a craft show. The customers could opt to receive an hourly wage or be paid the equivalent of time-and-a-half in jewelry and supplies. All of them went for the latter, saving her $800--the difference between what it would cost her to hire them at an hourly wage and the cost of materials to make the jewelry.

It's not a huge number, but for a four-day show, with a total booth staff of six, it makes a difference to my small-business bottom line," says Mojica, who plans to staff shows this way in the future and use volunteer forum moderators for her Facebook page, which she estimates will result in savings of $250 to $300 per month.

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