Can I afford to Mediate or Arbitrate?

By all means. Neither method is inherently expensive -- at least, not in comparison to litigation, which can tend to be drawn-out and draining, both financially and emotionally.  Mediation has the capability of resolving a dispute within a matter of hours or days depending on the problem, and the truly remarkable thing about mediation is that it can yield a "solution" upon which the parties actually agree!  In contrast, in arbitration, there usually tends to be a "winner," a "loser," or a "draw," and a neutral third-party makes that decision.  Even so, arbitration tends to be less costly and time-consuming than formal litigation.

So turn the question around: Can you afford not  to engage in some form of alternative dispute resolution?