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Selecting a Barter Exchange
By Enrique De Argaez, webmaster

If you want to barter for goods and services, your first step is to join a barter exchange. A barter exchange brings together hundreds or even thousands of firms that offer a variety of items. Exchanges facilitate transactions with barter credits, an in-house currency that members receive when they sell barter items and, in turn, use to buy items from other members. Exchanges also provide other services, such as record keeping and background checks on potential members.

More than 500 barter exchanges now operate in North America alone, and that number continues to grow. Most exchanges are reputable businesses with excellent track records. Before you join an exchange, however, check its background and suitability for your company. Joining the wrong exchange might hurt your ability to profit from the barter process.

Local or Global Reach
In the past, barter exchanges attracted members from specific geographic areas. As more exchanges have come online, members can trade with partners from across the United States and even globally around the world. But not everyone needs a global marketplace; before you join an exchange, think about how a trade partner's location will affect your ability to fulfill - and profit from - the transaction.

Can you get what you need? Make a list of the items you'd like to get from a barter exchange, and decide whether or not a particular exchange has the right membership to meet your needs. For example, if you want to barter for professional services, but the exchange includes mostly manufacturing firms, you might have a hard time spending your barter credits. You should also ask the exchange how many members are on standby. When a member is on standby status, they won't make any more barter deals until they spend the credits they already have - a possible sign that the exchange lacks diversity.

What happens to cheaters? It only takes a few bad traders to ruin a barter exchange. A good exchange imposes strict policies against price gouging, bait and switch tactics and other dirty business practices, along with clear penalties for violators. Some exchanges also run discussion groups where members can rate their business partners and expose possible cheaters. If other members complain about an exchange that tolerates repeat offenders, take your barter business elsewhere.

Check the Exchange Before Joining
The barter market is growing rapidly, but not all barter exchanges will survive the long haul. Before you join an exchange, do your homework: Check the exchange on the Better Business Bureau Web site, pull a Dun & Bradstreet credit report and talk with current members. Also ask if the exchange belongs to the
National Association of Trade Exchanges or the International Reciprocal Trade Association, the two leading industry associations.

Membership Fees and Barter Fees
Traditional offline barter exchanges charge membership fees (typically $200 to $700 per year), monthly account maintenance fees (usually $10 to $20) and cash commissions of 10 percent to 12 percent per transaction (split evenly between the buyer and the seller). Some exchanges, especially those focusing on larger businesses, still charge comparable fees. Others, offer much lower fees that small businesses can afford. This is especially true of Internet-based barter exchanges that offer free membership and charge per-transaction fees of as little as 2 percent.

When you evaluate an exchange, however, consider its fees as just one part of the big picture; a more expensive exchange might provide a more diverse membership and better service, so you'll get more value for your money.

All the best,

About the Author:
Enrique De Argaez is the webmaster of the
"Internet World Stats" website. Since 2000 he has been collecting Internet Usage Statistics, and publishing the data for over 233 countries and regions of the world for free use by the academia, the global business community and the general public. For more information on Internet World Usage, please visit:

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