Active International is the world's biggest corporate barter company in UK. Instead of money, Active gives companies barter credits for last season's clothes, spare hotel rooms or tins of peas, which they can swap for goods and services they need at a later date. A common purchase with the credits is advertising, company travel or printing, bought at a discount through Active's trading desks. Whether it is large companies with excess stock or small businesses that need to grow but don't have the cash, barter offers a way out of a fix.
Corporate barter isn't a new idea. For example, in 1935, US pharmaceutical giant Monsanto sold saccharin to a company in China. When the company was unable to pay in cash, Monsanto took frozen mackerel in exchange, and acquired an export market in the world's most populous country. In 1972, PepsiCo did a deal with the government of the USSR to supply the first western consumer product on sale in the Soviet Union. Instead of roubles, Pepsi was traded for vodka, and PepsiCo acquired distribution rights to Stolichnaya in the US.
Today, massive swap deals still happen. Last November the Thai government agreed to arrange a swap of 60,000 tonnes of excess rice for 300,000 South African cattle, avoiding a plunge in rice prices and solving its beef shortage in one trade. But thousands of small firms are also finding barter an indispensable part of their business. Barter exchanges handled goods worth $7.87bn in 2001, according to the International Reciprocal Trade Association. That business will grow 20% in 2002; add trades where no intermediary is used and the global barter market may be 10 times that amount.
Corporate barter helps companies get rid of surplus stock without flooding the market, causing existing retailers to slash prices or lose business. Then the trading desk of corporate barter company will then put deals together as complex as a Rubik cube. At the end the clients may find exchange partners in other countries they would otherwise hardly get in touch with.
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