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

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April 22, 2003

Written by Bob Meyer, Editor of BarterNews

"When you're an independent filmmaker, every penny counts, this barter thing is a win-win-all around."

—Jeff Peel, Director Miami-Dade Office of Film and Television Production

Faced with the perennial conundrum of financing their movies, South Florida filmmakers are latching on to what the big movie and TV studios have been doing for years...trading scenes featuring branded products for goods. Known in show biz as product placement, it's now a $1 billion-a-year industry.

It's a business that has been around for decades, used by everyone from the U.S. government for highlighting American technical savvy during World War I, to watchmaker Gruen whose Curvex timepiece was worn by Humphrey Bogart in Casablanca (1942), to Hearst Corp. which used Clara Bow to launch Vanity Fair magazine in the 1927 movie It.

"Product placement can save a third of your budget," declared Doug Schwab, president of Maverick Entertainment, which distributes B movies for video release. "We've always used it," he added, "but we're going to get more aggressive with it."


It Pays To Read Barternews!

"Thanks to you and your magazine, I was fortunate to read a particular article in your last publication about cruise ship lecturing. My wife and I are heading to Barcelona Spain on a Transatlantic cruise in late April—all on barter!"

Editor's Note: The article referred to was on page 44 of Issue #60, "Trade Your Expertise For A Cruise."


Get New Money-Making Ideas, And Valuable Contacts!

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


The Banking Industry Can Use Barter To Avoid Loan Write-Offs

What happens when a bank's major borrower is walloped by a regional economic crisis and can't repay a loan. The creative bank executive will think outside the box, looking to exchange their delinquent loan(s) for needed products or services: computers, airline tickets, hotel rooms—you name it.

We know of a situation where a Mexican bank used barter credits, arranged through a corporate barter company, to purchase new furniture for its branches. The deal was structured wherein the bank's delinquent borrower worked with the barter company, selling its product to them for trade credits, equivalent to the amount of the outstanding loan. (The barter company then sells or barters the acquired product to underwrite the balance of the transaction.)

The final leg of the transaction sees the bank accepting the trade credits from the delinquent borrower as repayment of the loan. In turn spending the trade credits, along with a cash blend, for needed products/services from the barter company.

Barter Can Be Used To Extend A Debt Deadline, Too

What if a borrower just needs a little more time to make a repayment? The creative use of barter can bring additional profits to a creative banker, as well.

That's exactly what happened when US Detergents, a maker of household cleaning products, bartered with PNC Bank to waive existing defaults and extend the deadline for repayment of a $35 million debt.

US Detergents provided PNC with options to purchase between 140,000 and 700,000 shares of the company's stock—depending on when it repays the debt.


SPECIAL Announcement: Be a part of the largest, most all-inclusive special real estate report we've ever published...coming in the next issue of BarterNews.

If your company offers any type of real estate service (assisting sellers and buyers, offering notary, property management, or counseling services) you should be in this special issue. Plus, of course, all types of properties available on trade—anywhere in the world! To get your company's ad in this unique issue contact: bmeyer@barternews.com... Do it now, so you don't miss this great issue.


Entrepreneurs' Optimism Is Roaring Back

After the September 11th terrorist attack sent the economy into a tailspin, small-business owners' faith in the short-term future plunged as well.

But the latest monthly survey by the National Federation of Independent Business, based on 10 components ranging from capital spending to inventories, reflects the most upbeat perspective on the economy in almost 19 years! That's the optimistic report from NFIB's Chief Economist William C. Dunkelberg.


The following message was used to promote one's trade exchange. The exchange owner sent this flyer/message out to every member....

Trade Is The Competitive Edge-Spread the Word!

We have begun co-publishing a monthly newsletter entitled The Competitive Edge that is a generic overview of barter in today's competitive marketplace.

In addition to providing the newsletter to you (our members) we have also begun a prospecting campaign using the publication. Each month we mail The Competitive Edge to businesses that would be an asset to our exchange, and follow up with phone calls.

Many trade exchanges have successfully used this newsletter, published by BarterNews magazine, to educate potential clients about trade and therefore attract new members. And we hope to have the same results here!

You can help us spread the word by providing some counter space or other conspicuous area to display The Competitive Edge to your clients. Waiting rooms, bookshelves, reception areas...wherever your customers have a chance to pick up a copy of the newsletter, they also will have a chance to find out more about bartering in today's economy.

Each month's issues offers new insights into the advantages of using trade and how it can improve a company's cash position. Every business owner will find the articles interesting and educational.

To learn more about The Competitive Edge newsletter and how it can help build your trade exchange, click here.


Every barter company in the world is listed here click through to our global list of barter companies.

PLEASE NOTE: The Global List of Barter Companies has been updated. Check out the new companies added, as well as changes made to the existing listings.


If you haven't read the current issue of BarterNews, get yourself a copy now! Orders are shipped the same day we receive them. (Click on Order Form.)


Here And There. . .
  • Just received from Art Kaliel of BXI in San Diego: My son is serving in Iraq with the US Army, and asked me to spearhead a "Candy for Iraqi" children campaign. The people are very poor and don't have anything. They need hard candy and non-perishible food stuff, but no chocolate.
    Send to:
    Jeffrey Kaliel
    312 PSYOP CO.
    LSA ADDER APO AE 09331

    (Editor's Note: Art Kaliel is known throughout the BXI organization as the foremost salesperson within the USA.)

  • Barter companies in Australia are awaiting a ruling from Australia's taxation office on how they should handle the GST tax question, i.e. whether barter companies have a GST-exempt status. Under GST rules, "financial supplies" are not subject to GST. The question is whether barter companies come under that definition.

    It's been almost three years since the GST was introduced. Despite the (tax) uncertainty, barter continues to grow in popularity with the business community.

  • Looking to exchange or cash out frequent flyer miles? Check out www.milepoint.com or www.points.com. However, to get full value for your miles, it's best to exchange them for award travel. Your best chances for a seat will see you avoiding popular, long-distance routes such as the U.S. mainland to Hawaii; forget holiday, Friday and Sunday flights; and look to travel in the off-season.

    (If you're short a few thousand miles of what's needed for a free ticket on an airline, check out this site: Miles4Sale.com.)

  • Two media moguls are spreading their wings... Norm Pattiz, Westwood One's chairman has been ordered by the White House to create a new U.S. taxpayer-funded Iraq Media Network (IMN). The Pentagon, while paying for the project, says the Iraqi people will eventually own it.

    And Arturo Moreno, a Phoenix businessman and partner in an outdoor-advertising company sold in 1999 to Infinity Broadcasting, is buying the Anaheim Angels. Moreno, reportedly worth $950 million, will become the first Mexican-American majority owner of a major-league sports team.

  • CEOs of the country's largest companies (members of the Business Roundtable) are expecting to cut jobs this year 45%, compared to 9% of CEOs who will be adding jobs. All agreed, at a recent meeting, that the U.S. is operating way below our potential, with consumer uncertainty being the problem.

  • The co-founder of the Quantum Fund, Jim Rogers, says commodities are the best place to invest for the next several years. Rogers, who started the fund with famed George Soros, says his bullishness is based on simple economics—there's been little investment in raw-materials capacity over the past 10-15 years and we're going to see growing demand from big emerging economies, i.e. India and China, which will result in higher prices for oil, zinc, sugar, lead, tin, cocoa, etc.

  • Russia, the world's second-largest oil exporter after Saudi Arabia, plans to build several new pipelines to grab more market share from the Organization of Petroleum Exporting Countries. The Bush administration welcomes the growth, hoping it can ease the West's reliance on Middle Eastern oil.

  • Ford Motor Company's automotive side lost $539 million last year. But Ford Credit, which lends money to dealers and drivers, earned $1.4 billion. Were Ford Credit a bank, it would be the nation's 10th largest, with $170 billion in assets.

  • 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 scam "Nigerian letter" on the Internet saw 16,000 complaints in 2002, up from 2,600 in 2001 to the FBI. The $5 billion worldwide scheme has been going on since about 1989. (Victims are presented with an opportunity to receive non-existent government money, often from the "Government of Nigeria" as long as they pay an upfront fee.)

  • In a past issue we covered the introduction of the successful Starbucks "stored- value" Card—where customers put money into it for purchases at Starbucks stores, and can reload the card at individual stores or the company's web site. The latest statistics from Starbucks show that 11% of Starbucks' transactions are paid using the card, up from 6% in fiscal 2002. Roughly 11 million cards have been activated since the program debuted in 2001.

    Starbucks, now a Fortune 500 Company, sees 20 million people a week buying a cup of coffee at one of their 6,000 stores (1,460 outside the U.S.) in more than 30 countries—3 new ones opening every day. A typical customer on the USA stops by 18 times a month, no other American retailer has such a higher frequency of customer visits.
We welcome your comments, questions, and observations.
Copyright BarterNews 2003. Redistribution of BarterNews content expressly prohibited without the prior written permission of BarterNews.