August 12, 2003
Written by Bob Meyer, Editor of BarterNews
Creative Entrepreneur At It Again—New Idea Incorporates Barter Concept For Small Business Owners
The man who came up the idea of the name-your-price airline-ticket company over the Internet, is at it again. Jay Walker has made a fortune with his Priceline.com concept; now he's testing a way to interact with consumers and the small business sector through a new company, GameShow 24.
By purchasing certain licensing rights to the TV game show "The Price Is Right," Walker provides online contestants with the opportunity to play four different price-guessing games with items from local merchants.
Successful players win their favorite prize from a showcase of free offers from nearby restaurateurs or businesses...such as pizza, a manicure, or personal-training sessions at a local gym.
The first game on the web site is free, and each subsequent game costs a quarter. The vendors barter their prizes, providing them in exchange for the opportunity to connect with local customers.
Presently being tested in various Connecticut areas, if successful, the company plans to launch the game in additional markets...possibly through franchising.
Every barter company in the world is listed on our web site, click through to our Global List of Barter Companies.
ITEX Completes Sale of Toronto and New York Offices
Corporate Overhead Also Reduced
The new administration at ITEX, led by Chairman & CEO Steven White, is moving quickly to change directions. The company has announced a substantial reduction in personnel, which began in mid-June. (Down from a high of fifty-seven in May, the firm now employs thirty-six.)
Additionally, the previously announced letter of intent has been completed with the sale of the company's corporate-owned offices in Toronto and New York. The combined sales price was $950,000, which will be paid to ITEX over five years. Three corporate offices remain: Seattle, Sacramento, and Vancouver (BC).
According to White, the sales occurred because the company wants to support the broker network of approximately 70 offices in the U.S. and Canada), rather than competing with it. By moving the offices a reduction in corporate overhead was also possible.
John Castoro, a former ITEX vice president, is the principal shareholder of the corporations—NYTO Trade and 44 Trade Corporation—which purchased the two offices. Castoro has a track record of success, and White expects big things in the future. "We anticipate that Castoro's exceptional sales expertise will assist our broker network, and his offices will increase the overall sales of the company." For more information on ITEX (OTCBB:ITEX) see www.itex.com.
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"What we have here is a failure to communicate!"
Years ago, one of the most visible people in the barter industry said the #1 reason why the industry wasn't farther along in its development was due to a "failure to communicate" by those in the business.
This realization was the genesis of The Competitive Edge newsletter, now into its 18th year of publication. Trade exchange owners who use this powerful marketing and promotional tool are never guilty of "failing to communicate."
As the owner of a trade exchange you must stay in front of your clients. Informing, educating, and inspiring them, because your clients' bartering is a relatively small percentage of their overall business. So if you don't keep their interest and enthusiasm for trade at a high level, you lose.
Your primary aim, like all other businesses, is to get your clients coming back for more. Every extraordinary business (and every trade exchange owner who wants to be extraordinary) knows that the customer you have, is a lot less expensive to sell than the customer you don't yet have!
Want to take your exchange to a higher level? Use The Competitive Edge newsletter in your operation—it "sells" the many benefits of working through your trade exchange like nothing else!
Extraordinary Revealing Report For Business Owners - Click here.
(From time to time, the Tuesday Report reprints an interesting article form the archives of BarterNews. This story was taken from the Andy Granatelli cover, issue #36.)
Meeting Planners Use Barter As A Tool To Save Money
It's a concept as old as civilization, but in recent times it's gradually been gaining acceptance as a tool that can be employed by meeting planners.
The tool is barter, and the trade market for hotel rooms in conjunction with business meetings is flourishing—at least in pockets—as corporations seek more avenues to save money.
Barter companies—which are also called corporate trade firms—purchase goods or services in exchange for trade credits that can then be used (bartered) for other goods/services in the barter company's inventory.
Often a meeting planner will contact a barter company at the prompting of a senior management person, who is seeking to unload trade credits the corporation has accrued with a barter company. Sales meetings are a great way to use up credits because you're spending a lot of trade credits at one time, as opposed to buying individual room nights which take longer to spend and are more difficult to administer.
There are dynamics at work when bartering which makes it attractive, particularly to a planner who can be flexible about the time and destination of the next meeting.
"If the hotel is driven by bottom-line needs and doesn't have to sacrifice its high-season business to meet them, then there are opportunities to trade for rooms," said Tim Brown, strategic sites specialist at Meeting Sites Resource in Newport Beach (CA).
"I've seen trades mostly on the media side, where someone provides the Hilton in Las Vegas with an ad in lieu of 100 rooms," Brown noted. "However, hotels do need things like carpeting, and various business products—such as computers, as well as advertising."
Two Conditions Needed For A Barter Arrangement To Work
For a barter arrangement to work, two conditions must be met, all observers agree: the corporation must not have done any cash business with the hotel; and the meeting planner must not have contact with the hotel prior to negotiations with the barter company.
In both cases, the reason is that the hotel has no motivation to barter with a client that it's already doing business with on a cash basis.
In addition to corporate barter companies, there are retail trade exchanges which operate on a more local basis by arranging trades between smaller companies.
A couple of examples of barter in action:
Most barter companies don't limit the selection of properties to those held in their inventory (that is, rooms for which the barter company has already traded a service or product.)
To be continued next week.
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