How the Barter Industry has Grown, Developed, and Changed Over the Years
Business owners today have seen their fair share of ups and down in the economy over the past decade but there’s still an opportunity to capitalize on. A 4th Financial dimension, barter, provides every business owner with an opportunity to harness their “private capital” and use it to achieve their business goals in the coming year.
This powerful “alternative financial marketplace” has been in place for decades and is ready and waiting to be accessed. You can take advantage of this remarkable situation without the hassle or need to consign your entire wealth to “get a loan” as often happens from the traditional lending institutions.
The Trade Exchange Industry Born Many Years Ago
The commercial barter industry was born many years ago in Los Angeles with the advent of the first trade exchange. Back in those early days trade exchanges sprouted up across the country like mushrooms, but there was little dialogue or cooperation among the owners.
In 1979, a handful of exchange owners - the early visionaries - met in LA. Realizing that for progress and greater profits to be made, a base of knowledge had to be established (along with the sharing of what constituted managerial success) the group formed an association called the International Association of Trade Exchanges.
Later they changed their name to the International Reciprocal Trade Association (IRTA), to embrace media companies, corporate barter companies, and others interested in reciprocal trade.
In 1984, a second industry association - The National Association of Trade Exchange (NATE) was formed as well, offering trade exchange owners an option and alternative philosophy to that of IRTA’s.
Both associations are doing very worthwhile work by establishing a code of ethics, promoting ethical behavior in the barter marketplace and among themselves, and providing networking contacts and valuable educational information for their members.
A Powerful Alternative Financial Marketplace Emerges
Two factors aided the further development of the industry. First was the passage of the Tax Equity and Fiscal Responsibility Act (TEFRA) of 1982 into law by the Internal Revenue Service. It was the “Magna Carta” of the commercial barter industry. And, like the historic document, provides a fundamental guarantee of rights and privileges. It recognizes the contractual basis of the barter system and places the exchanges alongside commercial banks, credit card companies, stock brokerages, and other institutions as third-party record keepers and accords them certain legal protection.
Secondly, from a marketing perspective, a quantum leap forward occured at the 1984 Olympic Games in LA. Under the entrepreneurial efforts of it’s Executive Director, Peter Ueberroth, a great deal of publicity was given to the bartered arrangements by the Olympic committee, when they acquired $166 Million of needed goods and services from blue-chip corporate sponsors in exchange for the right to us the Olympic logo in their advertisements.
Suddenly barter was viewed as a strategic marketing tool, used by the most prestigious - the largest and most successful - corporations on earth!
Since then, the media played important role in the education of this business community by their coverage in the top business publications like, Forbes, Business Week, Inc., Fortune, Success, and Entrepreneur, as well as the largest national newspapers like the Wall Street Journal, USA Today, the Los Angeles Times, and the New York Times. Additionally, doing small features on all three major TV networks have reinforced the credibility of the commercial barter industry.
The Future of Barter Looks Good
What’s most significant for the future of the industry is that those who are the industry’s leaders want to build an even stronger industry. Especially now.
But these current efforts by industry leaders would not be fruitful today without the loyalty and trust of the many thousands of business owners from around the country who entered into trade exchanges.
Because of them we now see a rapid growth in the barter marketplace. This expansion, which naturally enables a greater fulfillment capability, guarantees even more companies coming into the fold, incorporating barter into their operating decisions where it will become a normal function of business.
One doesn’t have to be a sage to see this continuing dynamism, because the “power of our private capital” is the 4th dimension - the barter marketplace. And it’s just beginning to be understood for what it really is - a powerful tool and unique medium of exchange, which can be easily harnessed to carry us to the attainment of our respective goals.