How Barter Trade Works?
Barter exchanges, in essence work exactly like a cash system. The exception is, instead of receiving cash, members receive Trade Dollars. These Trade Dollars spend exactly like cash within the barter network. In a reputable barter exchange, one Trade Dollar is equivalent to one US dollar.
- Members join and sell their product/service
- Member receives Trade Dollars
- Member shops with the Trade Dollars (just like cash)
Let’s take an example:
A retail store owner posts $500 worth of clothing for sale. The cost of goods is $250. Another member, a purchases the clothing as gifts for his family. The retail store owner now has $500 Trade Dollars in his account to which he uses to hire a mechanic to service his vehicle.
The cash cost is now $300 ($250 + $50 Service fee (10%)) instead of $500 cash. The retail store owner just saved $200 or 40% by trading. Where else can you get 40% discounts or increase your profit margin so easily?
Example 2
XYZ Restaurant needs $2,000 worth of printing services. The restaurant costs are 30%. The restaurant sells $2000 worth of gift certificates. The cost to the restaurant is $600 + Prodigy Barter Service fee (10%) $200 = $800.
The restaurant owner just saved $1200 or 60% by trading.
Simple formula.
100% – (Wholesale costs of product/service + 10% cash service fee) = Discount percentage
Restaurant Example
100% -( 30% + 10%) = 100% – 40% = 60% discount
*Overhead costs are not included in calculations as they will be billed whether or not you barter.
