The Ormita Commerce Network : Multilateral barter solutions for businesses looking to offset their fixed costs with new sales that we bring you. Ormita can help you increase your revenues, get more reference clients and pay for existing expenses with this new income. Contact us for more information
1. WHAT IS BARTER?
Barter is
Barter or trade is a powerful tool that represents a solution for companies with available inventory or services.
By accepting payment in “barter credits” where cash is sometimes difficult to get, a business maximises their efficiency by
increasing inventory turnover and billable hours. Using the “barter credits” earned, that company can purchase goods or
services they want - without paying cash.
A Multi-Billion Dollar Industry
According to the US Department of Commerce, barter exchange accounts for more than 30 percent of all financial activities
world-wide while the International Journal of Hospitality Management and the Michigan State University together claim that
approximately 70% of all Fortune 500 companies engage in barter.
The American Association of Advertising Agencies claims that 4 out of 5 media companies also engage in barter in order to
achieve maximum value from what would otherwise be unsold time and/or space.
World-wide, governments and companies continue to use barter to reduce surplus time and/or inventory, bolster sales and
ensure that production facilities run at near capacity. Barter continues to carve out an important place in the world economy.
How Does Barter Work?
A barter exchange offers an alternative distribution and sales network. Instead of letting products or services go unsold, or
requiring you to sell for reduced prices, a barter exchange allows the sale and purchase of goods and services using other
goods and services to facilitate the transaction.
Clients of a barter network use “barter credits” to account for the value of sales and purchases. Each barter credit is the same
value as $1.
The barter exchange acts as a third-party record keeper and provides clients with monthly statements that reflect all trade sales
and purchases.
Members do not need to barter directly. Instead they can sell to one member and buy from another. This solves the issue
of the seller not needing what the buyer
offers and allows transactions to take
place that otherwise would not be
possible.
The value of all credits within the
network equals zero. This is because:
When you sell
a. your account is credited
b. the buyers account is debited
This means that the buyer now owes you (or
someone else in the network) the amount
that they are in debt.
No value can “disappear” in the
network and everyone expands who
they can trade with as more people
participate in the barter exchange
system.
PLUMBING COMPANY
A plumbing company provides
a service to a hotel.
The seller authorises the
transaction, transferring barter
dollars from the purchaser’s
account.
A RESORT HOTEL
A law firm uses it’s barter
dollars for meeting rooms at the
hotel.
Plumbing
Services
Legal
Services
Air
Time
Hotel
Rooms
Trade
Dollars
Trade
Dollars
Trade
Dollars
Trade
Dollars
LAW FIRM
The radio station uses its
nearly earned barter dollars to
purchase legal services from a
corporate law firm.
A RADIO STATION
The plumbing company uses
barter dollars to buy
advertising on a local
radio station.