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JAY ABRAHAM – CASE STUDIES REPORT

This report has over 40 very brief case studies based on just a few of the innovative, non-
linear, revenue and profit increasing concepts I use for my clients – most from my work with
clients, some from mentors and colleagues. But all of them illustrate the fresh and non-linear
approach to business solutions I have created, developed and practiced all my business life.
These brief case studies and nontraditional business breakthroughs deal with different
companies, different industries, different obstacles and possibilities, and different paths to
different solutions.
Your specific industry might not be mentioned. And some of the examples might spotlight a
smaller operation than yours, or even smaller than I am now interested in working with (I’ve
worked with billion dollar corporations, but the sweet spot for clients is companies between $20
million - $100 million).
But size or specific industry isn’t what you should focus on in these examples. The key factor
in all these case studies is the way of thinking about the problem or opportunity that resulted in a
perfect solution. My fresh slant, non-linear way of thinking that worked for a plumber or health
club also works for a $100 million corporation. You’ll read success stories about better and
different ways to sell, market, reach and attract new buyers, resell past clients/customers and
much, much more.
Read these case studies (and a few short comments I’ve included) and consider the
innovative, non-linear approach to the problems and opportunities these businesses
faced…consider how your business could capitalize on the innovative examples and how my
non-linear, different point of view way of thinking could help your company.
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JAY ABRAHAM – CASE STUDIES

JAY ON: FLIPPING ASSETS

Not long ago everywhere you looked people were buying and flipping real estate. It seemed
everyone was buying a home, fixing it up a little, and selling it almost immediately for a sizeable
profit. We read about it in newspapers, online, and there were even television shows based on
flipping houses. The flipping real estate business model worked great. But here’s the good news
for you…that same business model works in many other areas. You can flip non real estate
assets just as easily, maybe easier than flipping houses.

I found a company going out of business that had 40 salespeople in the field who they were
going to terminate. I found a competitor of theirs who was willing to pay a six-figure acquisition
fee to hire and take over the best salespeople amongst the 40. PLUS he was willing to pay an
ongoing share forever of future profits from all the accounts he took over that kept buying from
him after the transaction closed.

I could then, split the lump-sum acquisition fee with the bankrupt business and then earn half
of all future profit payments coming in for as long as they continue. Variations of this can be
done all over the place, today.
…
I had a real estate agent client. We’d go out and buy the rights to work all the past clients of
every reputable real estate agent we could find who’d gone out of the business. And in
recessionary economy where real estate prices are dropping 30 to 50% and mortgage money is
hard to secure there are thousands of real estate agents going out of the business who still have a
good reputation and an impressive past client base.

Few people realize it, but the average agent who sold at least 100 satisfied clients over the
course of their real estate career can look for those clients to generate upwards of 100 future
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sales in the form of referrals over their lifetime. By tying up the endorsement of all the agents
who quit the business we were able to generate thousands of potential future referrals for my
agent client.

What was our deal proposition to all those agents? We offered the retired agents a small share
of future commissions resulting from their referral assignments. It worked like gangbusters.
…

How could your business profit from this approach? If you think your company isn’t position
to, or doesn’t have the ability to take advantage of this strategy, or any of the others you’re
about to read, I suggest you keep thinking. Initially, many of my clients were absolutely sure
their operation wasn’t a fit for this kind of non-linear thinking…and they turned out to be wrong
– happily and very profitably wrong.
All told, I ’ve found nearly 25 ways to buy businesses or more desirably, their key assets or
aspects of the business for no cash outlay, using options and lease arrangements instead of
outright purchases.
All that’s required to pull these kinds of deals off --- day in and day out -- is a basic
understanding of where the key assets lie in different types and kinds of businesses, how to tie
them up in a way the current business owner enthusiastically embraces.
Keep reading and let these examples stimulate your mind to think in a new, innovative, non-
linear way.

I found a plumbing service company with a great reputation, but a diminishing business who
was getting ready to shut their doors. I negotiated the rights to resell their website, email
address, phone numbers, and even their Yellow Pages ad to a larger plumbing company that
already had a complete operation - offices, salespeople, service people, trucks, etc.
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The buyer was willing to pay handsomely and continuously for all the future service business
that came from the original company. Think of how many situations like this exist. There are
many ways to find key opportunities like these.
….

I’ve gone to suppliers in all kinds of industries and asked them which ethical companies they
knew were in trouble. They’d tell me and I’d go out and offer to take an option on those
companies, businesses, their brand names, their past list of buyers, key facilities, or equipment
(trying always not to take the entire business). The assets are frequently, more valuable, also
easier to flip!
…

JAY ON: POWER PARTNERING

You understand investing and you understand minimum yield your investment --- 8%,
10%, 12%,...
How would you like to gain the yield from millions, tens of millions, hundreds of millions
of dollars’ worth of cumulative cash investment… millions of dollars’ worth of fixed
assets…hundreds of individual human capital --- people, skill sets… 10, 20, 30 years of
credibility… for nothing more than the creative ingenuity of knowing how to recognize and mine
and harness it?

There was a chiropractor who came to one of my programs and he used my principles to
create a very successful joint venture that had nothing to do with his main business.

He lived in an area where there was a big national forest. Every year that national forest had
to pay people to haul away the pine needles that fell from the trees.

He basically figured out that pine needles turned into mulch was probably the greatest
fertilizer imaginable, but most people didn’t see that. First he did a joint venture with a trucking
firm. He found a trucking firm that went right past the national forest delivering, but they were
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going back dead-ended. So he was able to make a deal with them where they would take pine
needles and deliver them to him for no fee, but for a percentage of revenue he would later get.

He found a big used car lot that was unoccupied where the trucks could drop off the pine
needles. He made a deal with them where they let him access their space for no fee, but for a
share of the revenue he was able to get for the pine needles.

He went to the National Park Service, and he underbid the company who was hauling the
pine needles away and disposing of them. He underbid them by 50%, because he figured out how
to take the pine needles, turn them to mulch, have someone deliver the mulch, put it on their
yard, and sell it - he made $300,000 the first year just by structuring that joint venture trilogy.

Remember, a chiropractor made a small fortune when he got into the pine needle
business. Innovative, non-linear thinking can result in revenue and profitability from areas that
traditional business thinking will never take you. What in your industry, or out of your industry,
might be your pine needle business? Keep reading and stimulate your mind.
…
Sears got the idea of starting All State years ago because they realized they could stick
agents in kiosks right in the middle of their stores, and they could draw and build a business with
virtually no marketing.
…
Years ago, I had a client who was a psychiatrist, a very respected psychiatrist, who
created a newsletter called Sex Over 40. It was designed to enhance the romance and sex life of
people over 40. And he sold the newsletter by running full-page ads in daily newspapers, and
they cost him a fortune. But he didn’t have any idea how to grow past that, and the problem was
every time he’d spend $20,000 on an ad, he’d be lucky to get back 100% of his money, and
frequently he didn’t even recoup his advertising costs. Sometimes he lost money.

I knew how to buy newspaper ads for 60-70% off --- remnant, stand by, distressed. I
went to him and did what I’ll call “marketing arbitrage.” I did a joint venture where I took his ad
and told him I would pay to run it everywhere around the country, and what I wanted was just to
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keep all of the advertising money. He was losing money on his own, and making enough on
renewals. He was delighted to just break even. I made $150,000 on that joint venture the first
month I did it.
…

When I went in the seminar business, I didn’t have one client. I went to a bunch of
financial newsletters that I had served and knew my reputation. I wrote letters for them to sign
that articulated their experience with me. I underwrote just the hard cost of sending it out to their
subscribers, telling people how great I was. We did $100 million from a standing start, for a
total out-of-pocket investment of about $300,000. We didn’t permanently share revenues, so we
paid money out. We didn’t make $100 million. We made about $60 million, between ourselves
and our partners, but it was all performance-based, by knowing how to access other people’s
goodwill, other people’s distribution, other people’s credibility.
…

Another client was in the financial services business. He was running ads in The Wall
Street Journal and selling annuities, and not doing very well. I set up endorsed relationships
with financial newsletters for him where he gave them a share. We set people up as licensed
agents, and he gave a share to those people, and he did $50 million in the first year, and went on
to do hundreds of millions of dollars.
…

Many of these case studies focus on leveraging advertising budgets. Keep in mind, these
same strategies work equally well with advertising on the Internet and websites.
…Keep thinking, searching, innovating, and stimulating your mind.

I had a client who had a medical delivery service that was very time-critical --- picking
up specimens, and blood test, etc. But they would usually go back empty.

We figured out that there were a lot of people who were fine having products delivered
over the whole day, and they were able to make a joint venture with another company that did
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that, but were paying their own staff, their own trucks. That company was able to totally get rid
of their trucks and people, used my client’s delivery service on the dead end run back. They
created a business together and split the profits - they made millions of dollars.
…

There was an ad agency executive who wanted to go into business for herself. She
worked for a prominent specialty baking company that had a very, very high-image brand. She
wanted to go into the chocolate chip cookie business. She went to them and got them to agree to
a joint venture where she licensed their brand to her cookies. She got them to let their sales
people take her product into their distribution, and she built a $20 million business instantly. But
it gets better.

She used the contract she had to go to a bakery and get the bakery to agree not just to
bake for her and not charge her until the revenue came in, but to give her an equity in the bakery
equivalent to the percentage of business her cookies met. She ended up owning that bakery and
buying seven more.
…

I did a deal with Holiday Magazine years ago. Holiday Magazine was a #3 advertising
choice in the market at the time for travel. It wasn’t a primary, and they couldn’t sell their
advertising very easily. I took their advertising pages. I traded them. Their advertising pages
sold for about $10,000 apiece. But they only really cost them incrementally about $1,000 apiece.
I went out and traded them to advertisers for big screen TVs, accommodations at luxury resorts,
and airline travel.

I took the travel and sold them for $.50 on the dollar. So something that retailed for
$10,000, cost $1,000, we sold it for $5,000, which is five times the cost, and I split revenue with
Holiday Magazine.

…
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There was a man named Roger McKee. He had worked for Siemens, NCR, a bunch of
major corporations. He quit to become an entrepreneur. The first thing he did was go out and
find very high-grade technology companies that did not have good marketing. He went to them,
and he said, “If I can get you distribution, I want 40% equity in the business that grows from
that.” He took a business that was struggling at $2 million, got them to $8 million in the first
year, and got 40% of the added $6 million --- the volume, the profit, and the equity.
…
A company called Encore Travel was one of the first companies to go to credit card
companies and show them that they had an asset in their inserts. Instead of sending bills out by
themselves, they could generate an incredible revenue stream by putting an offer in with their
billing --- particularly an offer that people could just charge right back to their credit card and
send back - and they would get many hundreds of millions of dollars.
…

We had a software company that sold a very expensive, entrepreneurial-based enterprise

software. They’d spent a lot of money on advertising. They got a lot of leads, but they
converted very few because their software was so expensive.

After coming to one of my programs and posing their problem, and me helping them,
they realized that the people responded because they were very interested in enterprise software.
But they just didn’t have the budget or the necessity to buy their $100,000 to $200,000 software.

So they found a software company that had a more meat-and-potatoes, basic software
product, but wasn’t selling well. They got the rights to that, to private label, and they were able
to sell that to all the leads that didn’t convert to their expensive software on a joint venture, and
they made more money from the people who didn’t buy originally than they did from the ones
that did.
…
There was a builder in Australia who specialized in first-time home buyers. He was
spending $10,000 to $15,000 per sale to attract buyers. After he came to one of my long
programs, he realized that the source of first-time buyers are people living in apartments. So he
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went to apartment owners, and he made deals with them where he gave them $5,000, which was
between $5,000 less and $10,000 less (it cost him $10,000 to $15,000 per sale.) He gave them
$5,000 for every one who moved out of their apartment and into one of his homes, and he also
agreed to underwrite any unrented apartment up to a year. At the time in Australia, apartments
were $500 a month, a year, $6,000. Even if he paid for a full year and the $5,000, he saved
himself $4,000 over the $15,000 expense, and he sold millions and millions of dollars’ worth of
homes.
…
JAY ON: CAPITALIZING ON CAPITALISM
Capitalizing on Capitalism is playing off of all the OTHER businesses assets and access –
assets that are not yours and access to those assets. In a recessionary economy or a good
economy there are many “leverage points” or impact areas you can tap into that almost no one
sees.

A man realized that financial and business opportunity newsletters didn’t know how to
market, and that they made their money on renewals and back end. He went to them all and said,
“I’ll do a sampling business where I will offer people three to six months of your newsletter in a
basket (i.e. 18 different newsletters for $20), so it’s irresistible. You give me the newsletter for
nothing, and you’ll get 25% of the renewal.” And George Ween sold 100,000 people this kind of
concept every year. He made a fortune on the back end.
…
Colonial Penn was an insurance company that was designed to sell insurance created for a
specific person. They were struggling years ago, and they couldn’t figure out how to break
through the barrier of trying to win over groups that already had affiliations.

Someone got the wise idea, “Why don’t we start our own organization, and we’ll have a
captive market?” They started American Association of Retired People just so they would have
a captive client.
…
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An amusement park in a big boardwalk did an analysis of what the average person, when
they came into their facility, spent. It was about $25. So they went to all the other non-
amusement vendors on the park --- the hot dog stand, the balloon vendor , etc. --- and they gave
them vouchers good for $.50 to $2.00 when someone bought a minimum of a couple of dollars’
worth of those vendors’ products because they knew every time they were redeemed that they
would average another $22 income. Everybody won. It was easy: “If you buy a hot dog for $2,
I’ll give you $2 worth of tokens down below.” It was a very good concept that worked
extremely well.
…
The first seminar I ever did, I found people who sold advertising and marketing seminars at
the $495 and below level. Their average was $295, their premium was event was $495. Mine
was $5,000 to $50,000. It was the perfect mix. The first thing we did together, we both made
$500,000, and they were exhilarated.
…
I went through another company that sold training programs to people on how to be a utility
auditor. They also sold training programs on how to be a real estate property tax abatement
specialist, and they would get tens of thousands of inquiries every year, and sell maybe 1,000 of
them a $10,000 or $20,000 course. And they wouldn’t sell 95% of them, but everybody that
inquired was interested in learning a skill. It’s just that theirs wasn’t right for them.

I got them to send a letter I wrote (today it would be an email) to all their non-buyers, and we’d
get $10 million of business by mining that in collaboration, because they had a program on
teaching how to be a marketing consultant. It was $20,000.
…
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JAY ON: MASTER OF PASSIVE INCOME

Have you ever driven on a toll road? When you drive on a toll road you pay for each
section you travel, and then pay again on your return drive home. Wouldn’t it be great to own
one of those toll booths, or a bunch of booths? All the work has been done – now someone just
sits back and collects money.
Creating the financial equivalent of passive income toll booths is just one of the
innovative concepts I deliver for my clients - not just a few, but hundreds of ongoing or long-
term passive income streams, windfall profit centers, recurring revenue sources, and flowing
rivers of income to my clients…while we’re not there.

George Culp had a lumber mill, and he would cut raw lumber, cure it, cut it into board, and
sell it. The key to all that --- the most critical function --- is the kiln drying, because if you do it
wrong it goes from A-grade to reject. If you do it wrong you spend tens of thousands of dollars a
week on energy, gas or electric. You do it wrong, and it’s just a mess. You do it right, and you
save a lot of money and you get a premium for you lumber.

He did it right. He was a fanatic about it, and he had the best kiln-drying techniques around.
The only problem was in the lumber business, because it’s so heavy, he could give the lumber
away to somebody 3,000 miles away, but it would cost so much to ship it that it wouldn’t be
worth it to the receiver. So from a practical standpoint, a lumber market is approximately 400 -
600 miles.

So I showed him how to take his kiln drying methods and license as many other lumber yards
outside of his 600-mile competitive radius all over the world, and he started making $2 million a
year just from recycling what he’d already done.
…

We had a dry cleaner client who develop incredible marketing techniques to grow his dry
cleaning stores. He had three in Chicago, but he never wanted to grow past Chicago. He had
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great marketing. He had great packages. He had great specialty services and he was doing about
three times the average revenue of a dry cleaner, but he was content with his lot.

I showed him how to take what he was doing in Chicago, block Chicago out, and license all
that technique --- all those advertising approaches --- to dry cleaners outside of Chicago, and he
got 3,000 dry cleaners to pay him a fee every month to use his advertising.
…

I had a car wash client who, through testing, developed techniques to increase dramatically the
number of people who upgraded to the hot wax, and the premium package. That added tens of
thousands of dollars a month to his bottom line. But they only used it in their one car wash. We
got them to license the techniques to 4,000 other car washes on how to use their upgrading, and
they paid them approximately $100 a month. My former client was making hundreds of
thousands of dollars on his licensing program. It’s a mindset.
…

We had a health club, and a martial arts club that realized if they gave certain kinds
of retailers certificates good, not for one free lesson, but for six months, which was
worth $500, it had very high perceived value. So the retailer could say, “I’ll give you a
$500 membership if you spend $200 with me.” The retailer loved it, because the clubs
charged them nothing. But approximately every four people who came and redeemed it
would extend to a $2,000 member.
…

When infomercials were just starting out here, I would to go to Australia and the
U.K. and do seminars. I taught a direct response specialist how to go to all the
infomercial people here who were limiting their horizon to just the United States and
get the rights on a joint venture to use their infomercial to buy their products at
incremental cost plus profit, and use it in Australia and New Zealand. He made $20
million a year, and he might not have made a dime if he’d created his own infomercial.
He got access to infomercials that people were spending $400,000 to manufacture, to
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create. He got access with rights that people had spent millions of dollars to develop.
All he needed to do was share, relatively speaking, the profit. He just had to be able to
ethically exploit that.
…
We had another colleague who would traveled the country and find all the people
selling products --- books, courses geared to direct response, through ads, through
letters. He would get the rights and take it to Australia, to the U.K., South Africa… He
made millions of dollars just seeing that creative arbitrage.
….

We made a client a million dollars who had no time, no understanding. We taught

her how to go out on the Internet, find people who had non-fiction business or skill-
type of books and match them with people who had training, expertise, coaching in that
skill, and take half the profit on both sides. She put a few people together that way, and
just by making the “money connection,” she was making a million dollars a year just
being in what I call the “toll position.”
…
Sometimes it doesn’t work because the money isn’t good. I had a deal one time with
an infomercial company. They had done a ton of infomercials testing people where
they were splitting 50/50 on the revenue, and about half the deals didn’t work out, and
they summarily abandoned them.

I looked at them and said, “A lot of these are back-end deals,” meaning that once that
company got a buyer, they kept getting subsequent product/service revenue. I said, “If
you restructure the deal to where you show that company that even if they made no
profit and just got their cost up front, they’ll make money on the back end” you can
make a losing deal profitable. We renegotiated five of the deals right away, and I made
a million dollars, and he made a multiple of that, and the companies that had basically
abandoned the relationship made a ton on the back end. It’s all a mindset.
…
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We had at a company that was in the aerobic/exercise attire business. They had
really hot-looking clothes for people who would work out. They only had two or three
products, and they came to me because the sales of their products were starting to slow
down, and they wanted a breakthrough. Upon very probative questioning, I realized
they had 5,000 or 6,000 retailers. At their prime, they had Kmart, a famous hosiery
company that had 700 outlets. They had Nordstrom. They had an impressive list of
impressive outlets.

But they were frustrated, and they weren’t creative. They had developed these two
products, and that was it. I said, “Your problem isn’t that. Your biggest asset isn’t
your product. It’s your distribution and your relationship with the buyers. You can use
that very advantageously. Go on a road trip to the hot cities --- Chicago, L.A., South
Beach, New York - Go to all the health clubs, and in the health club in the little snack
area there’s always some creative man or woman who’s created a design for tennis
shoes, or sweatshirts, or head bands that’s selling four of them there, and nothing else.
Find those. Go to the creator. Get a royalty deal on their products. Take them
outside.”

They immediately went into linear interpretation mode and said, “We don’t want to
be a distributor.” And I said, “Don’t. Tell that person they can keep all the sales from
their one or two health clubs, and you want to give them a 5% royalty on all the other
ones,” and they were able to tie up like, ten really cool products. It’s a mindset. It’s
understanding posture, power, leverage, control, value of intangibility.
…
As you’ve read these quick case studies you’ve seen they deal with everything from
business assets, distribution, advertising, process, inventory, staffing, and there are
many more areas that aren’t included in this brief report. But, again, I encourage you
to do what I do – stimulate your mind. How can my different business profitability
approach work for your company in terms of your assets, distribution, advertising,
process, inventory, staffing, and all other areas of your operation?
…Keep reading, thinking and stimulating you mind.
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Years ago, a lot of these really small art dealers realized that on the cruise ship they had a
captive audience for selling art, so they made percentage deals with the cruise ships to go on the
ships, have art shows every day, sell their art for very impressive markups and pay a variable to
the cruise ship in exchange for access --- access to a captive market.
…
A discount department store got the designer Massimo, who was really hot for awhile,
and then cooled down. They licensed his name --- just his name --- and then they got their own
designers to put together designs, and they put his name on it so they could charge a premium
over the norm they charged for clothes at their store.
…

I had a very good friend when I went in to business for myself. His name is Don Cracky.
He was the one who created (for those of you who are old enough to remember) Ricky Ticky
Stickies, which are what these great big stick-on flowers that people in the flower child era in the
70s and 80s would stick on their Volkswagen busses. But what his real business was --- he and
his partners designed graphics for ceramics, for sheets, for bedding… They would go to what I’ll
call “white label-type” --- boring, unimpressive, nondescript manufacturers of ceramics, coffee
cups, glasses, sheets… And they would offer them their designs, and they’d say, “Test these
designs against yours. If they tremendously increase sales, give us 5%. If they don’t, don’t use
our designs” And they made millions.
...

Many of you know Harv Eckert, and you know Russ Whitney, and you know Bob Allen.
They’ll put together a thematic training programs that have very good content. But they’ll get
speakers who will give content up front in exchange for selling a more expansive version of that
--- more specialized, expert advanced training --- and the promoters, the Harvs or the Bobs or the
Russ’s, will get at least half (and sometimes more) of the revenue just for orchestrating it, just for
putting it together.
…
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When 800 numbers first came out, no one realized the power of these phone numbers.
No one knew the impact. My associate would go to people who were running ads in The Wall
Street Journal, other financial, consumer, and specialty publications asking for direct response
for mail orders or for inquiries, or people would have to call the regular number or would have to
mail in an inquiry.

And he would say, “I will pay to put this slug (and a “slug” is just a reference to
approximately an eighth of the ad that had “…or call toll free this number”). I will pay that pro-
rata share of your ad. We will quantify the numbers of responses --- orders, telephone direct
orders, and mail-ins you’re getting. Those are yours. I don’t want anything from that. I want
half of the profits from the increase from my 800 number that I’m paying for, and I’m giving you
what it produces.” And he made millions by seeing that opportunity. I call it “creative
marketing arbitrage.” The same strategy works into today’s, and tomorrow’s marketplace – but
websites and emails become the prominent for of communication. Same concept, new tools.
…
When the commercial real estate business was struggling, a friend of mine went to a
bunch of office buildings that were not filled, and made a deal where they gave him a full floor,
and he turned it into these temporary suites, where anybody could rent it by the week, by the
month… And he shared revenue with them. His hard cost was just a very, very simple,
inexpensive build-out, and a secretary.

He also went to a phone company that had equipment they weren’t using and got them to
put the equipment in, not for $100,000, but for a small percentage of the revenue, and he split
with the office.
...
I had another associate, years ago, who was on the cutting edge of flea markets – yeah
flea markets (never leave a stone unturned when looking for revenues and profits). He went to
the Rose Bowl in Pasadena before anyone else was there and made a deal with them, and he set
up a regularly scheduled flea market – a huge fleas market. He’d do it all. He’d give them a
share, and he got a very long contract based on performance, and he made a fortune.
…
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There are a number of franchise companies --- not the big one, but the second and third
tier. They would sell one franchise, but they realized they’d be paying a fortune for the leads,
and very few would convert. So they would go to other franchises, and they would either buy
them, or get a deal where they got a huge share of the franchise fee for flipping their non-sold
inquiries into somebody else’s cheaper or more appealing franchise.
…
A friend of mine went and bought the rights to a once-prominent audio speaker company
that went out of business (it was very expensive, high-end) so he could put that name on his
lower-priced, well-engineered speakers. Somebody did it recently with the name Bell + Howell
for low-priced, curio-type electronics --- ear phones, products like that.
…
An associate was a consultant for a big waste management company. He was trying to figure
out every area of overlooked, undervalued opportunity for them – just like I do. They’d take
their garbage trucks to the dump, and they’d weigh them. Then they’d dump the waste and
they’d weight of the trucks again.

But the trucks would go with both drivers sitting in them, and he realized that the average
truck had 450 pounds (because they were big, heavy guys) of extra weight they were paying for,
with all the trucks, as many as 50 times a day, six days a week, he realized that if you got rid of
that it would save $2 million a year. This example isn’t about garbage or dumps – it’s about a
way of thinking.
…
JAY ON BARTER:
Business barter is trading your products or services for things your business needs or wants.
Barter gives you the amazing ability to vastly increase your purchasing power – sometimes as
much as five to ten times over. Done right, barter also gives you the effect of having almost
unlimited capital. It’s like having a blank check to fill in. It allows you to acquire products and
services now, but pay for them much later. And the longer you take to pay, the less it ends up
costing you. You can make barter a major factor in your business growth strategy.
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A major New Orleans hotel traded $125,000 worth of radio and TV time, and issued barter
script in that amount with a one-year expiration date. Right up front the hotel got $125,000 in
advertising at regular cash rates. This was advertising they had been paying $125,000 for in real
cash. At the end of 12 months an audit revealed that only $35,000 of the barter script had been
redeemed within the time limit. So the cash cost of the hotel delivering $35,000 worth of rooms
was only $5,000. The hotel had leveraged $125,000 in advertising for 5,000 hard dollars.
However, that does not take into consideration two overlooked, but extremely significant factors:

#1) Statistically, $35,000 in room trade produces $17,500 in cash, food, beverage and
miscellaneous real sales with gross profits in excess of $8,000 for the hotel. The hotel actually
got paid $3,000 net after all expenses to enter into the transaction.

#2) All $35,000 worth of rooms were not used at one time. It was spread out over 12 months,
meaning that the hotel got to pay the $5,000 over 12 months, totally interest free. In essence,
they got $125,000 worth of advertising up front, and got paid to do so.
…
The Home Shopping Network, which is now a billion-dollar+ business was actually
conceived and started by the owner of a small-time radio station in Florida who was having
difficulty making payroll. The owner traded 1400 electric can openers with a hardware store,
and then he cash-converted them over the air, and the company was saved. He did an auction.
He then began trading and auctioning goods and services he traded for over the radio and into the
listening audience. Within 60 days, the small station was back in the black, and the seller on the
air concept was further tested on the local cable. Then he bought some cable outlets. When this
also proved successful, investors backed the concept into satellite link. It went national. The
stock went up. The company’s sales now exceed a billion dollars. It all started with 1400 can
openers in trade.
…
Carnival Cruise started out as a border-based cruise line. It’s now the largest cruise line in the
world. It started with one ship, and had no real capital. They were totally under capitalized.
The first ship they had wasn’t even painted on one side. They had to park it on the painted side
so people wouldn’t know the outside was unpainted.
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The line traded empty cabins for radio, television, and newspaper advertising in 100 cities
over a ten-year period. The cost of a cabin, once the ship sells, is minimal. Plus, the passengers
may spend considerable cash in the bar, casino, gift shop…

Carnival traded the advertising to the radio stations. Radio stations either sold it, gave it away
as a gift, to listeners, or gave it to advertisers. When the advertiser or the recipient booked the
cruise, Carnival would charge them a processing fee of about $90. That $90 paid all the
incremental cost of towels, toilet paper, bedding, electricity… So they were out nothing. They
got the advertising. Here’s the payoff to Carnival:

They used this technique to become the largest cruise line in the world, and continuously
advertised in 100 cities for more than ten years without spending a penny of hard cash. A
conservative estimate of the amount of sales generated was hundreds of millions of dollars. The
owner became a billionaire, and was on the top Forbes Richest Men list --- all with this one
strategy.
…
You might initially think your company isn’t right or too large to take advantage of business
barter. I’ve found that virtually every business can profit from a barter strategy. Some of the
companies that are big barter participants --- Best Western, Sheraton, Outrigger, Beverly
Wilshire, L’Armitage, Carnival Cruise, Aero Mexico, KLM, Continental, Citizen Watch, Turner,
NBC, Budget Rent-A-Car, Avis, Hawaiian Tropic, Conrad Cruise, Mexicana Airlines, Air
France, Curtis Publishing, Samsung, Carl’s Jr., Levitz Furniture, General Rent-A-Car, Cody
Perfume… It’s just huge.

One of the first businesses I ever helped was a product called Icy-Hot. It was for pain and
still sells well (at the moment, Shaquille O’Neil is in their TV commercials).. The owner had no
money. But he had a product that was very, very effective.

It sold then for $3 a jar. The owner didn’t have a pot to you-know-what in. But he had an
ingenious understanding that every time he got ten or so people to buy the first unit of purchase,
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more than half of them kept repurchasing it every month for life --- for life. He had that
recognition. But he didn’t know what to do with it—because he had no money.

I contacted 1,000 radio stations, television stations, publications around the country and
persuaded most of them to run mail-order sales ads for us -- without us paying them a dime in
up-front cash. Instead, we let them keep 100% of the revenue from the first sale.

Why would we do that? Because every time that ten people bought, at $3 apiece, $30 came in
from them. But five of those people bought again and again and again, for life thereafter.
Making us $185 a year, every year thereafter.

We used that concept to generate 500,000 repeat buyers, build a $13 million company in 18
months --- with no capital investment. We sold it for millions of dollars to a prominent
pharmaceutical company.
…

I worked for the man who gained control of Curtis Publishing -- for nothing down. Curtis
owned The Saturday Evening Post and Holiday magazines, among other national titles.

My mentor gained control of it for nothing. How?… The Saturday Evening Post ran out of
money. They had approximately a million subscribers they couldn’t continue sending issues to
anymore.. Curtis ran out of money to pay for it. So, my mentor got control for just agreeing to
take over their magazine fulfillment liability.

Once he had control of the company, the first thing he did was to early renew everyone who
loved the magazine and brought in $4,000,000 cash. That was more than adequate to pay all the
remaining fulfillment obligation expenses -- leaving $2,000,000 extra for my mentor to use for
growth purposes and acquisitions.

Next, he saw that Curtis owned the rights to many Norman Rockwell paintings that were used
for magazine cover art. Curtis publishing owned all the licensing rights to the paintings, too.
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But the previous publisher did absolutely nothing with any of these rights. My mentor saw a
huge marketing leverage play here. He set up an in-house attorney---paid him almost purely on a
performance basis.

The attorney generated mid-seven figures a year in licensing income for the company – again,
by licensing the overlooked assets my mentor gained control of for nothing. They licensed it to
greeting cards, calendars, tee-shirts, art reproduction houses.

If you’d like to read them, I have hundreds more case studies and examples of how my non-
linear thinking produces breakthrough results and profitability. The point of all the examples is
to stimulate your mind and change you mindset. There are innovative, non-linear ways to
improving sales, marketing, reach and attracting new buyers, reselling past buyers and much
more.
If you’d like to explore becoming a personal client please contact my office. I look forward to
hearing from you and exploring if your company and my approach and insights would be a good
match.
Until then… Keep thinking, searching, innovating, and stimulating your mind