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Barter and Save Cash
By Enrique De Argaez, webmaster

Many startup experts tell you to barter to save money - but very few actually tell you how to realistically use bartering to reduce costs. Considering the great potential of barter trade exchanges in the Internet, I went searching for information on this oft-forgotten money saving business strategy. Here is what I found out:

Direct Barter and Exchange Barter

There is a big difference between Direct Barter and Exchange Barter. Direct Barter means to swap your product or service for the product or service of your vendor. Exchange Barter is the use of your excess time, capacity or inventory to trade for goods and services you need without using cash when you're part of a barter group with other businesses, and each business earns "trade dollars" that can be exchanged for needed items.

A trade dollar is the form of currency used by a retail barter exchange. In the United States, one trade dollar equals one U.S. dollar. Trade dollars are good for purchases within the issuing barter exchange, or within other exchanges that have reciprocal agreements.

The purchases are made using trade dollars accumulated from your sales at a full retail basis. Essentially, clients can purchase what they need using their trade dollars instead of cash and pay back what they owe with what they have in equivalent retail trade dollars. A line of credit can also be established to clients who are credit worthy and need to spend before they have accumulated trade dollars. Then over time they pay it back with their goods and/or services.

How Exchange Barter Works

An example will help to easily understand how Exchange Barter works: the ABC Restaurant wants to advertise on the local radio, which is also a member of your Barter Exchange. The full rate card price for an ad would be $35 per insertion. The restaurant buys a 40 insertion run for $1400 in trade dollars.

If you figure that the food cost to earn a trade dollar is $0.25 to earn a $1, the real cost of their advertising program is only $350. You can easily see why it’s smarter to barter! The following video explains all about barter exchanges in nine minutes:

It Makes Sense to Barter

Barter is an old idea that got new life thanks to the enormous communicating powers of the Internet. By joining a barter exchange you benefit greatly by getting new customers that you did not have before. When someone joins an exchange, they're exposed to hundreds of thousands of potential clients and new possibilities for:

- Moving Excess Inventory

- Moving Time Sensitive Services

- Increasing Cash Flow...

- Creating a Competitive Advantage

Do Your Homework and Join a Barter Exchange

Don't believe the misconception that you'll somehow get shady products or services in barter. It simply is not true. There are many trustworthy exchanges. Do your homework on any barter exchange you plan to join and check it out before you join. There are many information sources and it is simply good business practice to verify references, speak with present members of the exchange, and check with the competition and trade associations.

Check out these other barter resources for more details:

International Reciprocal Trade Association
Start Your Own Barter Trade Exchange
Teletrade International
dmoz directory

New barter articles will be added soon to the Internet Coaching Library as we find interesting themes, so bookmark this page and come back frequently.

Take care,

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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