Barter is perhaps the words oldest system of trade. In the barter system, goods and services are exchanged for other goods and services without any involvement of money. Corporate Barter involves exchanging goods or services that a company may have with media, services or products that they may equire in exchange.In essence, bartering involves the provision of one good or service by one party in return for another good or service from another party. Bartering is the most potent tool for companies to save / optimize cash and efficiently liquidate excess stocks & capacities. The new and improved Corporate Barter system is rising and growing exponentially, especially among corporate giants and for much more than just retail-oriented products. Many business establishments avail media,advertising,or more, in exchange for their needs and requirements.

Corporate Barter – The Trade Exchange plays an vital role in the record-keeping, arranging advertising / products / services on barter and sharing monthly statements to its clients. We earn our bread by charging a commission on each transaction when clients buy from us.  It is estimated that over 350,000 businesses in the United States are involved in barter exchange activities. There are approximately 400 commercial and corporate barter companies serving all parts of the world and the % volume is as high as 40%. In India still the percentage of barter business is around 15 to 20%, so there is huge potential and its growth is destined. Most of the Retail, Corporate and MSME are exploring barters and finding ways to save the cash / cheque outflows.

Benefits of Barter System

Barter System serves multiple benefits and advantages to its members. The clients should explore it to avail :-

  • Increase Sales& Productivity.
  • Fund Media Campaigns.
  • Reduce Cheque Outflows.
  • Liquidate Excess Inventory.
  • Explore New Markets.
  • Increased Purchasing Power.
  • Better Inventory Management.
  • Acquire New Customers.
  • Incremental Revenue & Profits.
  • Better Marketing Opportunities.
  • Avoid One to One Trade Hassles.

Barter Transaction

Barter transaction is as simple as any other trade transaction. let us understand it more with an example. A Hotel client intends to release a newspaper advert worth Rs. 1,00,000 through its inventory of Room Stays in the hotel. The Hotel approaches the Barter Agency-Corporate Barter and executes the barter deal through them.

How will this deal be executed?

a. Corporate Barter has its barter values lying with the newspaper.
b. Newspaper raises the invoice to Corporate Barter.
c. Corporate Barter raises invoices to Hotel for the Newspaper Advert and banks its barter value with the Hotel.
d. Hotel Pays the Transaction Fee + GST applicable to Corporate Barter through cheque.
e.The Hotel Room stays of Hotel are traded to multiple clients of Corporate Barter.
f. Multiple Products are offered to the media house for subscription and promotional offers.

Thus the values are banked again with media house.This is an ongoing process in the barter exchange-Corporate Barter thus the rotation keeps happening and the business keeps ticking.