Julie Mitchell-Mehta was visiting a potential client, an alternative health practitioner, to explain the services offered by her Aberdeenshire business, Debut Marketing, when she started telling him how much her ankle hurt.

By the end of the meeting they had agreed that Mehta would write a sales brochure for him in return for six sessions of laser therapy on her ankle.

The experience was a positive one for both of them. “Bartering is great because everyone gets something they want,” said Mehta. “Both of us were really happy and nobody had to spend any money. I would love to do it again.”

She is not alone. In these cash-strapped times a growing number of small businesses are discovering that swapping services or goods can not only help their cashflow, it can also lead to other benefits. First, offering something in kind tends to create a greater bond than if cash were simply changing hands. Second, by paying in kind rather than cash, each side is offering a product or service that is worth cost price to them, but retail price to the other side — to the benefit of both.

Another convert to bartering is Amanda Farren, who swapped a stand at the baby fair she was organising in Coventry for a term of swimming lessons for her daughter.

“I wanted to get my daughter swimming lessons so I contacted the owner of a local swimming company. I also mentioned the baby fair to her. The cost of the lessons, £80, matched the cost of the stand so rather than paying each other we made it a swap.”

The exchange has established a deeper bond between the two companies than a cash transaction would have done. Farren said: “We communicate by e-mail a lot and we recommend each other to people. She will be attending future baby fairs and I will be going for swimming lessons again. A relationship has been built up.”

When Peter Spencer started his business Le Bureau, which provides shared work space in Battersea, south London, he was strongly opposed to bartering. But when a computer expert offered to revamp his IT system in return for free desk space for four months, Spencer agreed to give it a go. He is now a convert and has tried bartering several more times.

“I have bartered with a marketing person and a graphic designer,” said Spencer. “The graphics guy designed my website and all my logos in return for desk space. We found that we were both happy with that and it made us feel better about ourselves because we were helping each other and supporting each other.

“Bartering is good because you feel like you are helping someone, and it establishes an emotional bond because there is no exchange of money. It makes you feel more appreciated because that person is appreciating what you are doing.”

He, too, found bartering had another benefit. “It is a friendlier way of doing business but it is more than that because you get more bang for your buck,” said Spencer. “In each case I found that we were both prepared to offer more so both of us had a better experience because of it.”

Jo Sensini is the owner of Velvet Integrated PR, based in west London. She recently agreed to be paid £1,000 in chocolate for some work and had also agreed to be paid in shoes by another client for a project that never went ahead.

She said: “I don’t do it very often because as a small business you have to be very careful about cashflow. However, if there are businesses that I really believe in and it would be an enriching experience for me and my colleagues to work for them, but they don’t have the funds to pay for my services, then I would consider it. Working for the luxury chocolatier was really stimulating because it was interesting and his products were great. It was a win-win for all of us.”

Sensini, too, said there are other advantages. “It can bring you closer to your clients because it demonstrates a level of commitment to them. It is also more satisfying. In my experience people are very loyal and if you have demonstrated that commitment and done a good job for them then they will stay with you.”

Jim Surguy, senior partner at Harvest Consulting, a business adviser, said there can be several advantages for small businesses that choose to swap skills instead of paying for them.

“For the person doing the bartering, the products or services they are offering are likely to have a higher value to the other side. For example, if their cost of production is £50 but the open-market value is £100, and they swap it, then the cost to them is only £50. There are significant advantages because of that.”

He added: “It also helps small businesses to cement relationships because it builds trust. There is a lot of trust and goodwill involved because if you are going to barter your services for a barrel of apples, you trust that there are not any rotten ones in there.”

However, Surguy also had a warning. “The downside of bartering is that small firms are usually short of cash, so by bartering they are trading away the opportunity to get more cash into their businesses. Another downside is that there is a tax problem because, if you are taking goods instead of money, it won’t show up on your profit and loss account and so you are in effect avoiding tax, unless it is a formal arrangement.”