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| HALIFAX, NOVA
SCOTIA — The
practice of bartering may seem
like a relic, but it’s thriving in Nova Scotia today with multiple
bartering organizations in existence. And with the economic slowdown, bartering may become more of a household word, says the owner of a Dartmouth-based bartering group. “If you think about it, you’re conserving your business’s cash. So bartering should be something you’d typically lean on,” says Chris Guildford of Barter Atlantic Ltd. Other local bartering groups include iTrade Atlantic. In business since 1990, Barter Atlantic has 165 members and last year, its members conducted about 8,000 transactions, he says. When members of the group perform transactions, invoices are issued like any transaction. However, the credits and debits of the accounts are handled by Barter Atlantic. No cash exchanges hands. Guildford says bartering decreases cash expenses because by trading for products and services normally paid for with cash, cash flow improves. It also helps grow your business. “It’s not just sales,” he says. “It’s new sales.” |
Craig Green is a partner with
Carroll and Green Inc., a
Dartmouth-based chartered accounting firm. He’s considering signing his
firm up and says bartering makes good business sense from an accounting
standpoint. “The biggest advantage for bartering is cash flow,” he
says. Green says in a normal business cycle, typically firms or people
perform a service, send out an invoice and wait for payment, which usually
takes from 30 to 45 days. “The benefit of the barter system is that you
provide the service, you give an invoice, and you automatically have a
credit in the barter system that you can turn and use to pay other
expenses and not have to wait for the cash,” he says. Guildford says the ideal member is a service-oriented company. “Your cost on every job is your time.” He says some of the disadvantages of bartering are that you can’t always get everything you want. His goal is to fill in the areas where they don’t have members to prevent this from happening. Guildford also says bartering isn’t good for businesses in financial trouble, because they need cash. To join the group, there is an annual fee of $200 and there is a 10 per cent commission that goes from the seller to Barter Atlantic on sales. “The purpose of you paying me 10 per cent is because I’m bringing you this customer,” he says. “You’re paying me to be a salesman for your company.” Guildford says he likes to quote one of the firm’s original members who used to say, “Where can I get a salesman for 10 per cent?” |
