January 28, 2014
by Bob Meyer, Editor of BarterNews
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From the desk of Bob Meyer...
Look Back (from 2005) ... The Rich & Famous Used Barter To
Barter Was Start For International Deal-Maker
Gonda, 85-year old founder of International Lease Finance of
Beverly Hills, started his business career after spending a
part of World War II in a labor camp in Nazi-occupied
Hungary. From there he
where he scored his first business success trading costume
jewelry with Indians in the jungle.
the profits to invest in Venezuelan real estate and launch
his own construction firm before expanding into the
There he built International Lease Finance and now places
orders in the billions for the latest in passenger jets,
which are then leased to major international and domestic
* * *
Superstar Actor Used What He Had To Get What He Wanted
ago when Hollywood superstar actor and producer Sidney Poitier
first arrived in
New York City, it was by bus with $3
in this pocket. He slept on the roof of the Brill
and got a job washing dishes.
with the help of a long-time waiter at the restaurant where
he worked, he made a trade with the American Negro Theatre.
They took him on as a student when he agreed to become their
* * *
Noted Analyst Bartered For Luxurious $500,000 Bus
nation’s best-known "non-flier" is football analyst John
Madden. Back in 1986, on a national TV program he discussed
his aversion to flying, saying he was "thinking about
getting a bus."
Gravley, Greyhound Lines' public relations man, heard
Madden's comments and spotted an opening to bring his
company some valuable P.R. The result: Greyhound seized the
opportunity, received millions of dollars worth of press
coverage (at no cost), and secured Madden's services for the
next three years in exchange for one of Greyhound's products
— a bus.
traded Madden the plush bus with special modifications for
his cross-country travel, worth about $500,000 at the time.
In exchange Madden agreed to give motivational talks to
Greyhound employees in the major cities he passed through
during the football season. Madden had to make 30 talks per
year for three years ... and the luxurious bus was his free
* * *
Man Became Billionaire With Barter Assist
Forbes magazine estimated Marvin Schwan's net worth at $1
billion. Operating in almost total obscurity in Marshall
(MN), Sales Enterprises was totally owned by the 60-year-old
Schwan. He had built a national door-to-door frozen food
delivery company, serving mostly rural households in 49
additionally owned three frozen pizza companies that sold to
supermarkets, convenience stores, school lunch programs,
hospitals, military bases, and the like. (A list of his many
other enterprises would take several more paragraphs.)
during the 1980s that Schwan attacked the $500 million
school lunch frozen pizza market in a very creative way. At
the time, to work off huge stockpiles of cheese, the
Department of Agriculture gave the nation's public schools
the stuff ... free of charge. To Schwan, the cheese looked
like an opportunity.
he won hundreds of school lunch pizza contracts by offering
discounts in exchange for their government cheese
allotments. But by 1989 the federal cheese stocks were
nearly exhausted. No problem. There was a flour surplus. So
Schwan set up a pasta company and contracted to sell
discounted pasta entrees to schools in exchange for the
government flour credits.
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See you next week...)
BarterNews.com — World's Largest
Hundreds of valuable articles,
techniques, and strategies are found in the following various barter
Offset & Countertrade,
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Categories are found on the horizontal bar at the top - 3rd
button from right.)
From the Archives of BarterNews...
Hoteliers Benefit When Working With Barter Organization
By George Otras, VP, Active Media Services
income from each hotel room represents a significant amount of money
to a hotel. It is the revenue back-bone, and biggest money maker for
any chain or individual property. However, if unutilized, the vacant
room contributes nothing to the bottom-line. Simple economics
determine that the empty room is invested dollars producing no
income; it is essentially an untapped, non-producing asset.
room's estimated worth isn't going to buy the necessary cash
purchases, both goods and services, that the hotel needs to keep the
property well promoted, well furnished, and financially alive.
can convincingly argue that hotels which are at peak capacity or
near peak capacity have no need for bartering room-nights. How many
hotels can make this claim year-round?
increasing number of properties and chains have been awakened to the
practicality of bartering empty rooms for supplies or other cash
expenditures in the service sector, namely advertising and
promotion. However, bartering is nothing new to the hotel business.
For many years hotels have set up cross purchasing agreements (or
contra accounts) with suppliers, in exchange for accommodations at
other participating hotels or for goods and services.
parties keep running balances on what each party has used from the
other. A difficulty arises when desirability or suitability of the
product and/or service involved is not what the other party wants or
existence of a third party organization, whose exclusive business is
facilitating trading between hundreds of parties, enables the
typical trading partner, or hotel, to eradicate this drawback. Aside
from eliminating the added expense of maintaining a barter
department, the hotel has access to the barter organization's
computer-based network of media clients, service clients and
barter company has "steering power" which increases the hotel's
market share of a barter company's client travel spending that they
would never have realized otherwise. This clientele will spend cash
at restaurants, gift shops, the golf course, the spa, for telephone
charges, video rental, and numerous other options within the
property. This is especially true since they have more disposable
dollars available when their room-stay is obtained on trade.
Furthermore, the integrity of a hotel's rate structure is protected
since no discounting occurs in the remarketing of the hotel credits,
because they are being traded and not sold into a trading community.
with a barter organization enables the typical hotel to barter for a
wider variety of services, be it advertising, contract work, office
supplies, rent-a-car vouchers or printing. This type of operation
prevents the hotel from having a liquidity problem with its barter
credits, since the barter company has a wealth of goods and services
to offer — more so than any bilateral arrangement developed by
arrangement also creates a tremendous word-of-mouth following which
is communicated to business associates and others, the price of
which is invaluable. A pleasant stay at a property creates a
following and a loyalty to that particular property which remains
long after the individual runs out of barter credit. The exposure
factor of getting live bodies into a hotel, to sample the
accommodations, should be welcome new business.
hotel management that appreciate the benefits of bartering have
recognized the necessity of these programs, in weak and strong
economies alike. The evidence for this is the continued usage of
barter programs and their successes. Programs can be designed to
avoid peak period usage by barter clients. This way marketing people
can avoid losing any available room-nights during heavy convention
or weekend periods.
one barter company that has pioneered hotel trading programs, with
enlightened management of major hotel chains during periods of
explosive growth and restructuring. These progressive and innovative
programs were developed by people with decades of experience in
hotel room trading. The major emphasis of all of these programs has
been designed to ensure the following points:
client maintains complete control of the transaction.
programs are directed towards both revenue and profit
program is designed to meet clients’ individual specifications.
Complete turn-key operation — administration, execution,
billing, audit, post-analysis.
Responsible hotel credit remarketing.
Professional media, goods and service delivery.
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