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The weekly newsletter for everyone interested in barter--the world's most versatile business tool!

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January 14, 2003

Written by Bob Meyer, Editor of BarterNews

BANC Trading Volume Sees 60% Increase!

Trade Exchanges Embrace More Efficient Way Of Reciprocal Barter

The National Association of Trade Exchange's currency, the BANC, reported $10,908,216 in trade volume for 2002...up 60% over 2001. BANC chairman Ric Zampatti says, "These figures show that the BANC is the premiere national currency in the industry."

BANC (Barter Association National Currency) provides its trade exchange members the opportunity to more efficiently handle reciprocal barter among each other. Rather than shipping products back and forth to offset each purchase, they use the BANC trade dollars to buy and sell from one another.

NATE provides these annual figures to the public, as well as naming the top five producers in total BANC volume in 2002: Illinois Trade, The Barter Company, Continental Trade, BarterNet, and VIP Barter, respectively.

For more information on the BANC or the National Association of Trade Exchanges contact NATE at: (404) 205-5378.


Publicly-Traded Barter Companies' (Small-Cap) Stocks Won't Be Affected By New Ruling

Wall Street's new dictate--the separation of investment banking and equity research--won't affect the six publicly-traded barter companies, as they all have revenues of less than $100 million.

Such small-cap companies have little to lose because even now so few are researched. In fact getting attention from Wall Street analysts is very difficult for any stock trading at less than $5 per share. At present, all of the publicly-traded barter companies are trading under 50 cents a share.


Saudi Arabia Demands Huge Offsets For Weapons Deals

As we reported last week, countries around the globe when making purchases are demanding offsets in addition to cash. Saudi Arabia is linking future weapons deals to such big offset packages--ones that would ensure the transfer of technology to, and training in, their country.

The city of Riyad is insisting that foreign companies competing for major contracts present proposals for offsets with a minimum of 30 percent and must include the transfer of technology, production lines (for economic development), and the establishment of training facilities for the employment of nationals.

The prospect of barter deals instead of cash for weapons has also been raised and could include the use of Saudi oil for military systems.


World Airline Industry In Deep Trouble

Barter Industry Not Yet Ready To Provide Large Scale Assistance

Combined losses of $31 billion in 2001 and 2002 are more than the airline industry's combined 45 previous years of profits! That's the message from the International Air Transport Association, at a conference last week in Trinidad.

In 2002 the worldwide industry lost $13 billion, in 2001 it lost $18 billion. Last year saw passengers declining 2.5% from the average annual 1.6 billion. (Lower traffic and greater costs for airline security were the major reasons for the losses.)

The 2.5% drop in passengers equals 40 million passengers. If the commercial barter industry were further along in its development, wherein it could provide the airline industry with competent, reliable fulfillment on a large scale, this certainly would be a most enticing market.


H&R Block Settles Suit With Gift Coupons...In Essence Gaining A Marketing Bonanza

The nation's largest tax-preparation firm has agreed to settle a Texas class-action suit that accused H&R Block of receiving kickbacks from a bank that issued loans to its tax-preparation customers.

While it isn't unusual for customers to get coupons in class-action settlements, it is interesting to analyze the large class action settlement. And it looks like H&R Block will not really be losers...in that the 700,000 class members who will get $262 million in $20 coupons can only use them against future Block services.

Only one coupon can be used each year. So inasmuch as the average Block tax return is $122, a plaintiff ends up paying $102 for tax preparation.

For H&R Block, the settlement becomes a marketing bonanza as the coupons must be used over a five-year period...yielding a $510 average revenue per claimant. If half the claimants use all their coupons, Block would stand to gain $178.5 million. (PS: The lawyers for H&R Block were paid in cash--$49 million!)


Internet Users Worldwide Reaches 655 Million

Global use of the Internet continues to boom according to figures released by the United Nations Conference on Trade and Development.

In 2002 there was a 30% growth over the same period the previous year, and Internet users worldwide were expected to reach 655 million by the end of that year.

At present growth rates, the report estimates that around 18% of all purchasing by firms and individuals could be done over the Web by 2006.

Pilot Project Underway In USA To Tax Internet Transactions

Between 20 to 30 states are expected to pursue legislation to extend sales tax collection obligations on all sales, especially internet-based transactions.

As soon as proponents get ten states to simplify tax rules, representing 20% of the U.S. population, they expect to seek congressional approval for mandatory sales tax collections nationwide. It could come as early as this summer, reports the Streamlined Sales Tax Project.


Get New Money-Making Ideas, and Valuable Contacts!

You can obtain these ideas and contacts in every every available back-issue of BarterNews.



Here And There. . .
  • Ebay's new offer of health insurance availability to some 30,000 individuals--known as "power sellers"--who buy and sell goods full time on its Web site reinforces the opportunity of large trade exchange operations, or the industry's trade associations, to follow a similar strategy.

    Admittedly, it has been tested by some from time to time, but not really "embraced" with the passion and dedication to make it happen. (A unit of Marsh & McLennan will be the provider of medical, catastrophic care, dental and other insurance to the power sellers.)

  • Cinnabar Enterprises/BarterOne (OTCBB:CINN) has announced the appointment of Val Copeland to the position of VP of Cinnabar Media Services. Copeland joined Media Services (www.cinnabarmedia.com) in November, 2001, bringing 15 years of marketing experience with Radio City Music Hall Productions, The Atlanta Tribune, and Media Exchange.

  • United Airlines is using its frequent-flier currency to keep some of its best customers as it struggles to survive while operating under bankruptcy-court protection. They've launched a double frequent-flier-miles offer aimed at four million customers (10% of their Mileage Plus members). Eligible travelers who book flights by January 24, and fly by April 4, will earn twice as many miles.

  • Have you signed up to receive a summary via e-mail of the Tuesday Report every week? If not, go to the top of this issue (right hand corner) to sign up!

  • The world's largest alcohol marketer, London-based Diageo, is adopting "ambush marketing" in a big way to introduce a new concoction--Smirnoff Ice Triple Black--during this year's Super Bowl. It's an end-run around ABC's most important client Anheuser-Busch, which always insists that only its brands be promoted to fans tuning in at home during the game.

    Diageo's strategy revolves around the purchase of 30-second slots from local television stations in some 64 U.S. markets during the January 26 championship football game. (This strategy is possible because the national networks let local stations sell several minutes of time during a broadcast, which enables advertisers to easily undermine one another by placing their ads during the same events.)

  • A new technology, known to many of us when we cruise through highway tollbooths, is about to revolutionize supply chain operations. Known as radio frequency identification (RFID) tags, they offer a superior way to track individual items as compared with bar-code labels.

    Early adopters of RFID tags have cut supply-chain costs by 3% to 5%. Tags are superior to bar-code labels because they don't require a line of sight between laser and label. Contents within a crate can be "read" as it passes a scanner, even if everything within the box is fully packaged and each item is unique. And RFID-tagged products can be scanned at from 150 to 1,000 per second, compared with 1 or 2 hand-scanned bar-coded items per second...reducing warehouse labor significantly.


We welcome your comments, questions, and observations.
? Copyright BarterNews 2003. Redistribution of BarterNews content expressly prohibited without the prior written permission of BarterNews.