Why
Pay for It
When You Can
Trade for It!
When You Can Trade for It!
You can trade what you have for what you want. You can start your own local small barter exchange. You can start an exchange for your Community or Chamber of Commerce. You can serve your community and start a Complimentary Currency or Time Dollar exchange. Or, you can start an online barter exchange business and provide trading services to business members locally, across the nation or even throughout the world.
The possibilities are limitless… It just requires some creative business thinking and a paradigm shift to using alternative trade or digital currency instead of cash. What’s best about it with VirtualBarter and our 65 years of combined barter and corporate trade experience, we welcome the opportunity to help you succeed, participate in the global trade network, and prosper.
Retail Barter
Small business owners conduct barter transactions through membership in commercial trade exchanges. Most members do business within a 35-mile radius. Their business revolves around services – everything from chiropractors, attorneys, accountants, graphic designers, and plastic surgeons to mom-and-pop businesses like car washes, dry cleaners, lawn and garden maintenance, and repairs.
There are 400 commercial barter exchanges in the U.S. and another 200 worldwide. The number of members per exchange ranges from about 200 to about 10,000, with most under 1,000. In total, the business-to-business network of barter exchanges represents over 450,000 companies, a small markets share compared to the total SMB market.
Under the Tax Equity & Fiscal Responsibility Act of 1982 (TEFRA), trade exchanges are classified as third-party record-keepers with the same fiduciary responsibilities as banks and securities brokers.
Corporate Trade
Larger companies trade products and services through accounts receivable (AR) trading, relying on a corporate barter company to purchase inventories offered for sale with trade credit and subsequently to fulfill the trade credits by providing products, services and media requested by the seller. The corporate barter company acts as a principal in the barter transaction, buying and selling for its own account and becoming the purchasing agent for clients with regard to the use of their trade credit. About seven to ten corporate barter companies do about 95 percent of the corporate trade business.
Corporate barter as it is practiced today originated in the late 1960’s. At that time, corporate barter was primarily a financial tool – a way for companies with excess or obsolete inventories to recover costs and even full wholesale value for their inventories. Today, corporate barter both remains a profitable alternative to markdowns or liquidation and provides a valuable service to expand a company’s advertising and marketing plan using the leverage of a barter transaction. Corporate barter also facilitates foreign trade with countries that have goods and services to exchange but no hard currency.
Examples of corporate trade are numerous: unfilled trucking on return trips, idle plant equipment, excess maintenance inventory, years on a lease when a company moves, and even shares of stock in a firm. Privately held companies sell restricted stock for trade credit to offset marketing costs that will help build name recognition and market share, to build trade credit reserves, or to purchase hard assets such as real estate.
Countertrade
The Department of Commerce says that barter in its various forms accounts for about thirty percent of the world’s total business. The International Reciprocal Trade Association (IRTA) announced that U.S. barter transacted through commercial barter brokers exceeds $18 billion annually. Over 450,000 U.S. businesses actively use organized barter.
There are many good reasons why more and more businesses worldwide are bartering their products and services, but underlying them all is one fundamental business motivation; businesses profit.
Airlines and restaurants can fill empty seats, hotels and resorts can fill empty rooms, printers can fill press downtime, professionals can fill empty time slots, health care professionals can treat new patients. Business owners and professionals can then use this new found revenue from the sale of excess capacity at full price, and reduce cash expenses or expand their operations.
Businesses across America, and globally are taking a serious look at barter as a way to build their bottom line, and the rapid growth of the online barter industry can only mean that business likes what today’s barter industry has to offer.
Businesses large and small choose to barter in order to gain specific benefits
Retail Trade
- New sales and customers
- Increased buying power
- Conservation of cash flow
- Alternative financing
- Interest free credit
- Low cost advertising
- Cash sales from referrals
- Enhanced quality of life
Corporate Barter
- Convert slow moving inventory into current receivables
- Put surplus production or capacity to use
- Get full value for unsold capacity or perishable inventory
- No loss or write down for trade credit sales booked as a prepaid expense
- Increase market share with lower cash investment
International Countertrade
- Hard currency
- Balance of trade
- Expand into new markets
- Acquire manufacturing capabilities
- Increased exported goods
