Why Businesses Use Trade

To increase sales
Growth-oriented businesses are prime candidates to trade their goods
and services as members in a barter exchange. Companies interested
in increasing their revenue, keeping their workers engaged in
productive work, and/or looking to rid themselves of idle inventory
or under-performing assets often find that joining a barter exchange
helps them accomplish all of these goals.

To Conserve Cash:
In addition to generating new sales, barter also enables an organization
to conserve cash. Trade credits can be used to purchase equipment,
supplies, inventory, as well as a wide range of business and personal
services without the use of cash. With barter, companies can buy what
they need at the carrying cost of their inventory, thereby reducing the
cash outlay for needed items.

To Support The Local Economy:
Many business owners like the idea of supporting other businesses
in their local community. By joining their local exchange, businesses
support each other by buying and selling from each other using trade
credits.

To Enhance Productivity:
Barter helps companies put inventory, equipment, and employees to
good use, creating new revenue that would not have been available
otherwise. That new revenue can be used to finance the purchase of
new equipment, raw materials, or services to support the business.
Essentially, a company’s less productive assets are exchanged for
more valuable products or services through the help of a barter
exchange.

To Reduce Non-performing Assets:
Businesses with obsolete inventory frequently find that bartering the
assets yields a much better value than liquidating it for pennies on
the dollar. Instead, the company can sell the inventory to a barter
member for trade credits close to the carrying cost or book value
and then apply those credits to other business expenses, such as
marketing, entertainment, travel, or raw materials purchase.
Exchanging an unwanted asset for something else of value helps
recover a significant amount of incremental revenue that might
otherwise have been lost.

To Reduce Seasonality:
During months when business is typically slower, due to a
company’s product or service mix, companies can still strengthen
their overall financial position by accepting trade credits.

To Establish New Business Relationships:
In addition to the bottom line impact trading can have, participation
in a barter exchange significantly enhances a company’s network of
contacts. Businesses develop new professional relationships through
the buying and selling that occurs among trade members. Those new
relationships often lead to additional cash business as well.