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Before you hit the back button thinking bartering went out of fashion when money came along. Think again. Bartering has not only thrived all this while, it has made a come back in the business world in a big way. If the International Reciprocal Trade Association is any indication, bartering today is a whopping six-billion-dollar business-to-business success story worldwide. And it is expected to grow by more than ten percent annually. Bartering down the ages Dictionary defines bartering as the exchange of goods and services without monetary transaction'. It is simply an exchange of goods between two parties, who need something from each other. This mutual give and take has been practiced since antiquity, but has had its share of problems too. Picture this, a fishmonger wanting a new fishing net goes to a net maker with a handsome catch of fish. But the net maker isn't interested in his fish. So, the fishmonger has either to remain without a net or make one on his own. And he can't do either. So, he exchanges his fish with someone else for an item that the net maker would be interested in, and exchanges it to get his fishing net. This is what happened till money made its appearance. But bartering continued to be practiced on a low key. Remember, you have done it too as kids, when you exchanged the center spreads of your favorite beauties for CDs of some really cool music. Well, this was bartering in its most basic form. Only recently has the world woken up to the immense business potential of this form of trade. Resurgence of bartering Bartering would have remained on the fringes had it not been for the invasion of the wonder chip called computer and the Internet. With its introduction, it became possible to barter in an easy and inexpensive way. This is because of computer's ability of tracking barter transactions and maintaining huge inventories conveniently and economically. To facilitate the burgeoning barter trade, many online facilities were introduced. The most important being the barter exchange, whose spread has fueled an explosive growth of bartering by creating markets for traders and bringing the interested parties together. Benefits of bartering But how is bartering better than normal business transactions? There are a number of benefits that has made bartering a force to reckon with in the business world. Let us see what they are: Types of bartering The most common type of bartering online is one-on-one or direct bartering that you can indulge in quite successfully. Its shortcoming is the difficulty in searching for the right deal. For example, you may sell soft toys and may want printing services, but you may be hard put to find a printer who may want soft toys in return. The other type of bartering is called the third party bartering. It uses some form of currency to allow more dynamic exchange between the parties. Businesses generally use both types for best results. Modern-day bartering If you do business on the Internet, then bartering may be a golden opportunity knocking at your door. For those serious on bartering, the first step is to enroll in a barter exchange. This exchange will readily help you find what you need by actively searching for the product or service you desire. The advantage of a barter exchange is that it networks with other exchanges across the country and even overseas, thereby extending your area of influence. How to find barter deals online? There are various ways to find barter deals online. They are:
Is bartering suited for your business? Before you take another step forward, remember some businesses don't lend themselves to bartering. Obviously barter won't work for you if the product or service requires only cash. For example, car payments, mortgage payments or child's education fee and the like. So, find out when bartering won't work. Some points are given below:
Steps to successful bartering Before you launch yourself into bartering, it will be prudent to prepare well for it. First and foremost, analyze your products and services, and your buying and spending methods and see if they fit into the bartering scenario. The local barter exchange can provide you with a list of members along with products and services. This will facilitate you to find out what is available and who your potential customers might be. You should be clear what all goods and services you are willing to barter. The best way is to make a list of what you need for your online business. Calculate the approximate monetary value of the goods or services you are seeking or trying to trade. This information will help you negotiate a successful barter deal. At times you may find other online business houses reluctant to barter. You may have to educate them on the benefits of bartering, why it will be a win-win situation for both and how it will be a fair trade. The following tips may help in winning the trust of your potential bartering customers:
Is bartering taxable? Bartering is treated like any other business transaction by the tax authorities. It has no tax advantages or disadvantages. The barter exchange you have enrolled in, keeps track of what you buy and sell, and reports your trades to the IRS. Even sales taxes may apply on certain transactions. The barter system offers a wonderful opportunity for you to gain what you want by offering what you can spare. Although bartering can't rescue your failing business, it can certainly enhance your company's market and profit potential. So, if you are looking for a great way to trade, try bartering. It may very well turn out to be a blessing in disguise. See Also: Interest only Home Loans: Are They for You? Tips Regarding Interest Only Loans Interest Only Mortgage A Short Term Fix Interest Only Loans |
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