You likely bartered when you were young, trading baseball cards or maybe swapping toys, but the Internet really re-energized the ancient practice, and the Great Recession gave a further popularity boost to exchanging goods or services without using currency.
You probably know about the barter section on Craigslist, and U-Exchange boasts 70,000 members. Local Exchange Trading Systems includes tiny volunteer nonprofits and highly organized barter societies and clubs like NeighborGoods. More sophisticated swapping sites with mobile apps include swapdom.com (with its cute explanatory Lego video) or listia.com. However, as rapidly as barter sites start up, they can go out of business just as fast (like zwaggle or bookins) or change their business model (thredup.com is now sort of an online thrift shop).
Almost anything you can imagine is being bartered for by someone — be it vacation home stays, video games or garden plots. Shannon Simmons, a former Toronto financial planner, bartered her services for a year as an experiment, but found rent was one of the few things she couldn’t barter for. Lindenwood University in Missouri in 1999 started an Education for Pork program in which farm families could trade hogs for the opportunity to earn a sheepskin. It later invited bartering of other items.
More than 7,000 sharing initiatives worldwide are listed at www.compareandshare.com, a New-Agey compilation of ways to engage in crowdsourcing, recycling, bartering and other aspects of the sharing economy.
Be Part of the Trend
You, too, can join the cashless economy and barter with the best of them — though you probably won’t manage to barter your way from a red paperclip up to a house, as Canadian Kyle MacDonald did in 2006 with a series of 14 trades.
You can barter on your own or sign up with a trading exchange service. These generally charge a membership fee to act as a broker or clearinghouse. They can match up trades more quickly and offer a sense of buyer confidence. Members get “barter dollars” or “trade dollars” and then are matched up with the equivalent-value trades for items or services that they desire.
Swap.com warehouses children’s clothes and other stuff to swap and then fulfills trades with a proprietary algorithm for a transaction fee. Like on eBay (EBAY), traders can be thrown off exchange rolls if they bargain in bad faith one many times.
Bartering in the Business World
The more-established business and commercial exchanges belong to the International Reciprocal Trade Association. The nonprofit reported its members set a record in 2013 of more than 8 million inter-exchange barter deals among 400,000 companies. Since its 1979 founding, the association has fought to legitimize the industry with ethical standards and broker training.
On regional exchanges like Florida Barter, small businesses can make trades and business connections at the same time. These commercial exchanges can charge membership fees, monthly fees and commissions. Larger businesses might check out bizx.com or the decades-old www.activeinternational.com.
Wannabe traders should also know that the Internal Revenue Service considers barter transactions as taxable, with some exceptions. That said, bartering can save you cash and can be fun.