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DEFINITION
Barter refers to exchanging goods or services without money. People can barter either indirectly, by using a shared or "common" medium of exchange such as trade credits, or directly, through an even trade of computers for cars, for example.
BARTER CARRIES the dual distinction of being both the earliest sort of trade known to humanity and one of the hottest new types of transactions to hit the Internet. Today, an increasing number of companies and individuals are bartering goods and services both on and off the Web, without the use of money.
Corporate barter (a term specific to business-to-business trade) has been commonplace for decades. Some practitioners say barter gives them a better deal by securing the equivalent of list prices for goods and services they can produce for much less. Certainly, if a company has overestimated demand for its product and faces excess inventory as a result, barter provides better payback than alternatives like liquidation. New or unused goods that are put up for barter usually consist of either manufacturing overruns or discontinued models. To clear warehouse space, many companies liquidate these kinds of goods, even though the products are top quality.
Corporate barter has traditionally been limited mainly to new or unused items. Now, though, companies are sometimes disposing of used goods over the Web, either on auction sites such as eBay Inc. or some new barter sites.
Information technology staff can help improve a company's overall bottom line by putting used IT equipment like computer hardware and software up for barter. "The trade can be used almost anywhere in the corporation," says Steven White,...