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IWS
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Internet World Stats > Internet Coaching > Business
Tips
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,
Ricky
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: http://www.InternetWorldStats.com
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