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

May 6, 2003

Written by Bob Meyer, Editor of BarterNews

Caterpillar Uses "Currency" (Frequent Flyer Miles) for 20 Daily Flights

Construction and mining equipment manufacturer Caterpillar has found an effective way to automate what for many travel managers is the worst possible nightmare—appropriating travelers' frequent flyer miles and using them to buy air tickets for others.

To achieve this success Caterpillar is using TravelWare, a third-party company based in Salt Lake City that specializes in tracking and optimizing mileage for corporate clients.

Caterpillar has calculated that it is saving 10% on its air bill by obtaining tickets with mileage rather than cash, with some parts of the business reaping even higher rewards.

Under the TravelWare deal, every flight booked with the company's agency is automatically queued to TravelWare. They scan its database to see if anyone in the traveler's business unit has enough mileage points to pay for the flight. If so, TravelWare attempts to buy the ticket on barter...using that mileage.

One in five of these attempts is successful for a total of 20 flights per day. To further optimize its resources, Caterpillar only uses mileage on more expensive flights which tend to cost fewer points per real mile.

NASDAQ Forms Strategic Barter Arrangment With Market Wire

The Nasdaq Stock Market is forming a strategic partnership with Market Wire, a Los Angeles press-release distributor, to be its recommended disseminator of corporate news. The agreement contains a barter component in that Nasdaq is receiving a warrant that can be exercised for a non-majority stake in Market Wire.

In exchange, Nasdaq will also promote Market Wire on its Nasdaq.net web site. The site is a portal for Nasdaq's new Corporate Services Network, which is expected to make Nasdaq more competitive in servicing publicly traded companies.

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.)

Women's World Banking Provides Money On Grassroots Economic Level

From time to time we report on how one person's actions can make a difference. Nancy Barry, the 53-year old founder of New York based Women's World Banking, is such a person.

Barry, who graduated from Harvard with an MBA, began working with the World Bank, and although she rose quickly through the ranks, she tired of its bureaucratic nature. Consequently, 14 years ago she left to head Women's World Banking, a much smaller, more-personal version of the World Bank.

The organization is a global network of microfinance organizations and banks that provide low-income women from 40 countries with small loans. Women's World Banking has now made loans to more than 10 million poor people.

The average loan is $356, and 98% of the women who get loans repay them with interest or a fee. To people in developed countries these small loans seem trifling, to impoverished women of Asia, Africa, Latin America and Eastern Europe they provide hope of a better future for their children. And it enables them to realize their potential and talents.

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!

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 and the U.S. List of Barter Companies has been updated. Check out the new companies added, as well as changes made to the existing listings.

Get New Money-Making Ideas, and Valuable Contacts!

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

• Walt Disney Co. isn't very popular with cable and satellite operators after once again informing them of a 20% rate increase for the popular ESPN sports network. However, a barter offer by ESPN executives to avoid the 20% hit may help the situation a bit.

  Under the offer, a lower rate schedule of 11% to 16% could be obtained if distributors (cable and satellite operators) agree to carry a range of its new products, i.e. ESPN Deportes—the Spanish language channel, and ESPN HD—a high definition offering. ESPN also is looking for better deals for ESPN2 and ESPN Classic.

• China's economy is growing faster, 9% in the first quarter, than it has since 1998. The growth spurt comes as more foreign companies invest in China to produce goods cheaply for export. It could extend for years, as China's domestic consumer market is just beginning to develop.

• U.S. financial-services companies plan to transfer 500,000 jobs (8% of total industry employment) to foreign countries during the next five years, according to a new study by A. T. Kearney. The study estimates an annual cost savings of $30 billion for the financial-services industry.

  The substantial savings is exemplified by the following: A call-center employee in the U.S. earns $20,000, in India about $2,500; a Wall Street researcher with a college business degree and a few years experience in the U.S. earns as much as $250,000, compared to $20,000 in India. India is the most attractive country, followed by China, the Philippines, Canada, the Czech Republic, Mexico, Australia, Brazil, Ireland, Hungary, and Russia.

• The National Federation of Independent Businesses estimates that 60% of the roughly 41 million Americans who lack medical insurance are members of families who own or work for small businesses.

• The National Restaurant Association tracks the health of the $426 billion restaurant industry, and reports things are picking up a bit, snapping out of a five-month slump. Sales increased 2.7% for February, the most recent reporting month.

• Venture-capital investing is now at a five-year low, according to the MoneyTree Survey released by PricewaterhouseCoopers. For the first time in five years, quarterly venture investment dropped below $4 billion.

• Iraq owes foreign creditors anywhere from $60 billion to $120 billion. Michael Kremer, a 38-year-old economist from Harvard, is researching the debt associated with tyrannical regimes. He contends that Iraq cannot begin to pay off all the debtowed. And if they don't, it could send a strong cautionary signal to creditors in the developed world about lending to dictatorships.

  It could also give rise to a more formal way of handling such lending in the future, i.e. the U.N. Security Council, or even a coalition of the willing, to declare future borrowing by tyrants illegitimate. Kremer argues that if creditors are told in advance that lending to certain regimes is illegitimate, they will be less likely to finance dictators.

• A barter agreement of sorts, regarding the restructuring of Iraq debt, is already underway. Russia, with a $12 billion debt stake, is looking to discuss the rescheduling of Iraqi debt provided Russian companies are allowed to participate in the economic reconstruction of Iraq.

• You will have to toil a few more days on the government's behalf in 2003, as 74 days of income will now be required to pay a family's federal taxes. Only 61 days of work are needed for housing and household operations, according to the executive director of the Tax Foundation which calculates such information.

• Sales of PCs to businesses have remained flat at roughly 87 million units annually since 2000. Sobering news for the personal computer companies, since businesses buy roughly two-thirds of all PCs.

• 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!

• Last year hotel loans in the U.S. were only $1.8 billion, after dropping off dramatically in the economic downturn after the 9/11 attacks. However, hotel lending in 2003 is on pace to hit $5.5 billion.

• New legislation is being proposed in Congress that will allow for a much faster deduction on tenant improvements for commercial real estate (including shopping centers, office buildings and motels).

  Under current law, an owner who spends $1,000 on improvements for a tenant with a 10-year lease can deduct 1/39 of the expense when filling out their taxes each year for 39 years. The proposed amendment says the owner could deduct 1/10 annually for 10 years, thereby recouping their investment much faster. The law is expected to encourage owners to make more improvements more quickly.

• Online auction sales of fine art are now a part of the past, as Sothebys.com is ceasing operations. Sotheby's was "the last man standing" in the effort to bring sales of fine art to the Internet. What happened? The enduring part of an art auction allure was lost on the web, i.e. the experience of a traditional auction acquisition after many viewings, flattering attention from specialists, and a spirited bidding war with a noted visible rival was missing.

• The U.S. post office is negotiating with its biggest customers-major credit card companies-offering them a special discount for first class mail. (This is different than the standardized price breaks for zip-code sorted mail.) The Newspaper Association of America, representing about 2,000 U.S. papers, contends these publications could lose advertising if using the mail gets cheaper.

• The credit-card market in the U.S. is $1.2 trillion by purchase volume, annually. The debit-card business/purchases are $480 billion per year. But debit-card purchases are where the growth is, increasing by about 24% a year, or three times faster than the 7% growth in credit-card usage, according to the Nilson Report.

• More corporations are using auctions to sell surplus property. Gwent Group reports that real-estate auctions accounted for $63 billion in total sales in 2001, up 50% from the previous three years. Intel Corp. plans to auction off a 428,000 square-foot manufacturing complex on 68 acres in Puerto Rico, minimum bid $10 million, a fraction of the replacement cost of $30 million.

  The reason is timing. Auctions are an expeditious way to get property off the books by year end...as they can be completed in 30 days, versus 18 to 24 months when utilizing a traditional real-estate marketing effort.