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| AUCKLAND, NEW
ZEALAND — Bartercard chief executive Paul Bolte said bartering across the
network, where the 6,500 member businesses buy and sell goods and services
between themselves using virtual "trade dollars", totalled $23.5 million.
It was a rise of 12.6% on December 2007, said Bolte, which was itself a
record-setting month. The feat seems to defy economic gravity as businesses across the country struggle in the face of a deepening economic downturn. But around the world, barter networks thrive as economies falter, so much so Bolte is predicting 2009 will be a record year. Bartercard's members, who pay between $975 and $2,500 a year for their membership (all tax deductible as a cost of business), bartered goods and services worth $198m last year. This year, the total will be around $215m, Bolte predicts, and he has ambitious targets to get trading over half-a-billion dollars a year within seven years. The beauty of a barter network is that member businesses can trade off their spare capacity for goods and services they need, without the need for hard cash. For example, an accountancy business with half a day's spare capacity each week can earn trade dollars (which are taxed just like ordinary dollars) by doing other Bartercard members' books. These can then be spent on things the accountant would otherwise spend hard cash on, such as cleaning services, a printer, paper, legal advice, or anything provided by another Bartercard member business. |
Bolte says many
Bartercard members do between 5% and 10% of their business in "trade
dollar" transactions with other network members, but that tends to
increase when cash business is slow as businesses seek to barter away some
of their cash flow problems. It can mean the difference between keeping
staff and having to lay them off, says Bolte. Although
bartering is as old as civilisation, the modern concept of trade exchanges
like Bartercard was born in the aftermath of the Great Depression.There's a faint echo of that beginning in the emergence of Bartercard in New Zealand, which launched in 1991, when the economy was struggling. The record December isn't just about the economic downturn, says Bolte. It is undoubtedly a big part of it, particularly as some businesses have been using the exchange to offload distressed stock, but the last 18 months has seen a revitalisation of the business, which had lost its sense of mission. Exchange members include thousands of medium and small- sized businesses, and some of the giants of Kiwi commerce - Telecom, Fisher & Paykel Appliances, Panasonic and high-flying basketball team the Breakers, who Bartercard sponsor. Bolte said Bartercard was aiming for between 12,000 and 15,000 member businesses in seven years. "Right now we are primed for a major surge in growth." |
