THE EXPLODING BUSINESS OF BARTERING FROM HARVARD BUSINESS REVIEW

The Exploding Business of Bartering

HARVARD BUSINESS REVIEW

  7:00 AM September 12, 2012

What do Honda, Haymarket Exhibitions, and your plumber have in common?          Bartering. Business bartering is big, and it's happening at every level. The International Reciprocal Trade Association reports that in 2011 over 400,000 companies worldwide used bartering to earn an estimated $12 billion on unwanted or underused assets.
Our Global Trends research, along with discussions with senior executives around the world, show that in response to tighter credit and budgets companies are exploring new ways to create and capture value. In this context, they see bartering as a way to steer around the restrictions imposed by cash and credit, to extract value from perishable or underperforming assets, and to expand channels to market and find new customers.
Business bartering has been around for a while (Pepsi conquered the USSR by exchanging the soft drink for vodka in 1990), but the pace is rapidly increasing. In 2010, for example, the North Carolina Bar Association approved the participation of attorneys in organized barter exchanges allowing them, for example, to swap legal services for credits to "spend" on a vast range of services from computing to web design, auto repairs and advertising. Now, at barter exchanges across the world, professionals from doctors to electricians are trading their services for goods, services or "trade credits" which can then be used to pay for business expenses whether printing, advertising or travel. Meanwhile, corporate barter firms, the intermediaries in barter transactions, have flourished, helping companies to create value from assets which may no longer fit their strategy, may not be working at capacity or are no longer needed. Client firms swap what they don't want or need for something they do — frequently media services. In addition to swapping goods and services for media, companies can use the trade credits they receive from the bartering intermediary to exchange for freight, travel, waste management and equipment. Honda, Kia and Subaru have bartered cars for media trade credits. Haymarket Exhibitions made part payment for advertising using tickets to their exhibitions. Leading electronics firms have bartered discontinued stock, placing it in leading hotels in exchange for media and trade credits — gaining a potential new client in the hotel group in the process. Food manufacturers have bartered excess inventory in exchange for media credits or trade certificates allowing them to purchase other services such as hospitality and cleaning. Lufthansa has bartered real estate for media credits and aviation fuel.

Companies considering bartering should consider three questions:

• Are there services for which you could barter to improve your cost base or capacity utilization? For example, if you are in the travel industry, can you trade "perishable" excess capacity — whether rooms or golf tee times — for flat screen TVs or refitting your fitness center, as Magnolia Hotels based in Denver has done?
• What under-performing or non-strategic assets do you have that could generate value through creative bartering? For example, food processor Hormel Foods Corporation sold a frozen food brand which no longer fit its strategic goals to corporate barter firm ICON in return for putting part of its media spending through ICON.
• What other assets could you benefit from bartering? For example, could a barter deal quickly expand reach, credibility or brand recognition in the market for new products poised to launch? One start-up microbrewery in the US funded its launch and purchase of essential services by bartering for its stock via a barter exchange — building its brand in the process.

Look around your organization. How can you use barter to reduce costs, enhance revenues, build awareness or otherwise expand the pie? What linkages do you need to build in your organization, for example between purchasing, finance and the business units to make these deals work?

This is a great article I found on barter economy and wanted to share it:

Barter Economy

inShare

No Currency?  No Problem!

A barter economy is an economy that lacks a commonly accepted currency, so all exchanges must be made with goods and services because money does not exist in these economies.
Bartering may sound like a style of commerce more fitting to a backwater marketplace than a modern capitalist environment. According to the International Reciprocal Trade Association—an organization created to promote “just and equitable standards” in modern bartering—the U.S. barter market is a staggering $12 billion annually. In other words, $12 billion worth of goods and services are traded every year without any currency changing hands.

Barter Economy is Gaining Steam

Scott Whitmer, founder of trade exchange company Florida Barter, says that while 2011 saw positive signs of an economic recovery, many small and medium-size companies are still struggling. “Bartering has continued to help many [of these] companies grow and conserve cash,” he says. Though Florida Barter enjoyed a record 2011—a 12 percent increase in total trade volume; more than $17 million worth of trades among the 1,600 clients—Whitmer says bartering as a business practice is still in its infancy, “on the cusp of exploding.”
People often require some encouragement to give bartering a shot. Debbie Lombardi, president and founder of Barter Business Unlimited, a Connecticut-based exchange network, says that despite her company’s track record and 4,000-plus registered members, she still regularly encounters resistance and confusion from prospective customers. “Nobody comes to me and says, ‘I’ve always wanted to try bartering,’?” she admits. “It’s more like, ‘I don’t get it. Is this some kind of scam?’”

The Barter Economy is no Scam

It’s no scam, but it can be complicated to the uninitiated. As Lombardi explains, “We run like a little bank.” Members are paid in “barter dollars,” which they can exchange with other members for goods and services. Within the bartering community, it’s the only acceptable currency. “It’s like going to a barter mall,” Lombardi says. “They can do all their holiday shopping. They can get the carpets cleaned. They can pay for their child’s orthodontic work. It’s almost limitless.”
Barter Economy excerpt from Bloomberg Businessweek, Rise of the Barter Economy
Barter Economy is further defined by the link provided.

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(ref.  http://trade-in-exchange.com/barter-economy/)

FEEDLY

Recently I cam across this article regarding "feedly" and I thought it was very interesting.  Here I share it with you:

#1: Subscribe to Blogs Using Feedly

Blog posts can be a great source of content, but it takes time to visit each blog and check for new posts every day. Subscribe via email and you get far too many emails or they may not arrive at a suitable time for you to read them. This makes an RSS reader a valuable curation tool.
Google Reader has been widely adopted by content curators, but Google is retiring this product on July 1.
An ideal replacement is Feedly, which lets you easily receive, organize, read and share content from your favorite blogs.
With Feedly, the most recent content from each blog you subscribe to is added each time you open it up. Feedly makes sure you see new content and provides a central place to read and share it from.
Features:

• Use Feedly on Desktop and Mobile – You can use Feedly from your desktop and Android, Apple iOS and Kindle mobile devices.
• Integrate Feedly with Buffer – Instead of sharing all of your content at the same time, Buffer will spread publication out across preconfigured times.
• Organize post views to suit your reading style – There are some excellent configuration options that allow you to view posts in the way that best suits you. You can group blog posts into different categories, scan a summary of the posts, view the full posts, save posts to a queue for later viewing or tag articles so you can find them easier in the future.
• Find new feeds – A feed is the content of a blog you subscribe to. In Feedly, you can search for new feeds by category, by entering in the URL of the feed or by searching with keywords.
• Take advantage of Pinterest integration – You can pin images directly to your Pinterest boards from within Feedly.
• Get Curated Featured articles– You can switch this feature on or off. When it’s on, Feedly will automatically highlight popular articles.
  
  Articles can be featured at the top. These show you articles from blogs you have subscribed to that were shared a lot on social media.

Setup
Prior to July 1, you will need an account with Google Reader to use Feedly; if you don’t have a Google Reader account at this stage, wait until July 1 and register with Feedly directly.
For now, when you first install Feedly, it connects to your Google Reader account and imports your current feeds. After July 1, you can use Feedly as a standalone application.
Once you have Feedly installed, you are ready to add feeds from your favorite blogs. To add a new feed, select the ‘Add Content’ option and enter in the feed URL, a title or #topic.
We searched for Jay Baer’s blog Convince and Convert.

Subscribing to a feed to display within Feedly.

When Feedly finds the blog you want, click the ‘+’ button to add it to your Feedly feed.
When you add a feed, you will be asked to do some basic configuration to help identify the feed with a title. A useful tip, shared by Kristi Hines, is to name the feed with the Twitter address of the person/company who provides the content so you don’t have to look up their Twitter address each time you share something.
In addition to naming the feed, you can also categorize it. This lets you organize blogs into custom categories such as personal and business.

Song Lesson- Economics Barter & Trade

The Ancestral Feeling

In a world in which we are all so socially connected we are loosing the most important ingredient in the recipe to have a good client following. We have forgotten that fuzzy warm feeling that we create when we talk to each other or when we shake hands or just know our customer. We are so involve with our blogs, twitter, Facebook and company that we forget that people still prefer to do business with people they know. When you barter you have that human contact. That ancestral feeling of doing the deal right because it will mean that you are doing business with your neighbor. I know it is old school. But it works.

Think Barter First

"THINK BARTER FIRST."  This is what I try to inculcate in all my clients. When they ask me why is it so important, I always answer the same way: "IT MAKES SENSE!!!!"

If you read my blogs or my articles (wiki-how), you will  also see how it makes sense to always THINK BARTER FIRST.

~ Eddy Anton

Prosumer

You can be a consumer or a producer. When you barter you can be a a prosumer. If you want to learn about how to benefit from being a prosumer contact me:

EddyAntonJr@gmail.com

Tip of the Day

TIP OF THE DAY from Trade International Exchange (TIE):

Think of ways to use barter to create an incentive for your employees. Perhaps that bonus can be a weekend mini vacation or a couple of tickets to a football game.

Call to find out how to get started! (855) 900-8439 (TIEX)

Think Trade First

Think trade first. This means that before you spend cash you ask yourself if you can get it on trade. If in doubt, ask your trade advisor at Trade International Exchange (TIE)