THE concept of exchanging goods for mutual benefit didn’t disappear with the invention of coins in Mesopotamia more than 2,500 years ago. It has always been in the background, overlooked, perhaps, in the rush to make a buck, but part of everyday life. Ever swapped anything yourself? Your children do it all the time, it’s playground economics.

Moreover, bartering has been big news again. Remember Kyle MacDonald? The Canadian made headlines worldwide when he succeeded in swapping, via trade after trade over the internet, a paper clip for a house. In the course of his adventure, he swapped items including a pen, a party pack of beer, a snowmobile, a recording contract, even a lorry.

Less well-known is the fact that bartering is a true commercial industry estimated to be worth more than £4 billion globally. Most modern bartering is electronically recorded and run by commercial exchanges. There are also locally run barter or networking clubs.

The larger commercial exchanges offer their members — usually small to medium-sized businesses — the opportunity to sell their goods or services to other members in exchange for “barter points” or “trade dollars”, which can be used to buy goods or services from other members.

Some exchanges charge a membership fee and cut of each transaction, others use just a flat commission. They usually offer “brokers” to help members to find other businesses to trade with. The taxman treats barter sales in the same way as cash sales.

Joining a barter exchange can have the double advantage of increasing sales and helping cashflow. Sales might increase because members are introduced to new customers looking to spend barter points, while cashflow can be preserved by using points instead of cash to buy goods and services.

XRL Events, a St Albans-based events management company, is a member of two commercial barter exchanges. Neil Sen, the managing director, says: “We have sold sponsorship or hospitality packages in exchange for points, which we have used to buy catering and marquees for our events. We will be doing a number of events in Australia for the Ashes and, because the exchanges have international offices, we will be hoping to do similar deals out there.”

Yet some companies that have joined commercial exchanges have reported difficulties. David Scott, the managing director of Rainbow Productions, a small South London-based company that makes life-size mascots, joined a barter exchange in order to accept an offered order worth £3,000.

“After joining and completing the order, we wanted to spend the points on printing,” Mr Scott says. “We used the exchange’s directory [of members], but, after calling almost 40, we found only one that was willing to do the work. — and they were only willing to do £600-worth.” He has since left the scheme.

Other companies have complained that prices quoted in barter points are often higher than cash prices, with some members reluctant to exchange physical goods.

Stephen Alambritis, a spokesman for the Federation of Small Businesses, says that the commercial barter industry in the UK is still in its infancy. “Our members have been looking at barter exchanges, but few have joined,” he says. “For commercial exchanges to work effectively, there needs to be a critical mass of members. It is important if you are going to join that there is an exit point where you can easily offload your liabilities.”

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