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CENTERPIECE : The New Bull Market : More people are using barter as an alternative to paying with scarce cash. Groups make it easier to plug into the system.

April 01, 1993|AURORA MACKEY | TIMES STAFF WRITER

Adam did it to get Eve.

Early colonists did it to get food.

So Bob Gibson figured he'd do it to get braces for his son's teeth.

"We were talking about $3,000, so at first the dentist was a little skeptical about the concept of doing it on trade," said Gibson, a principal in Buena Financial, a Ventura lending corporation.

"But I said that because of the expense, we only had the budget to spend barter, and not cash. And after I explained the ins and outs of it, he said he thought it might actually be fun."

What Gibson explained was an ancient system of doing business that's gaining popularity around the county--as well as nationwide--as more and more people are discovering good ol' fashioned swapping as an alternative to paying with hard currency.

These days, the practice once referred to as horse trading--now called bartering--is usually done via computer.

"In today's economy, there isn't enough cash, so what we try to do is help people get business--and maintain a lifestyle--that they otherwise wouldn't have," said Diane Vantrees, general manager of SCM Barter Services in Ventura.

The bartering group was formed two years ago and now has more than 200 members countywide. Although most are small-business owners, many are individuals with a specific service to offer--such as giving massages or manicures--or people who have a onetime big-ticket item, such as real estate, to exchange.

"Another advantage is that, for a lot of businesses, barter also can open up new markets," Vantrees said.

For Bob Burk, regional director of sales with the Radisson Suite Hotel in Oxnard, bartering room nights over the past year has made it possible for the hotel to obtain everything from new upholstery and a resurfaced parking lot to printing services for brochures. All of those services, Burk said, might have been put off if paying cash had been necessary.

"A great percentage of the time the room wouldn't be filled anyway, so the actual cost to us is not the same as credit," Burk said, adding that the hotel also has gotten repeat clientele because of it. "We feel like we're getting a good deal."

Burk clearly isn't the only one who thinks so. Last year, the total value of bartered goods and services in the United States and Canada was $6.45 billion, a 9.3% increase from 1991, according to the International Reciprocal Trade Assn. in Virginia.

The number of trade groups such as SCM--which generally have a membership cost and receive a commission on all transactions--also has increased. In 1989, there were about 300 such groups, compared to 520 last year.

In contrast to the bartering of old--which often came from the "I'll swap you my chicken for your hen" school of negotiation--members of bartering clubs such as SCM are afforded a bit more flexibility. Rather than trade their products or services directly for someone else's, members build up credits--sometimes called "barter bucks" and issued in coupon form--which can be exchanged for anything offered by another barter group member.

Members with credits burning a hole in their pockets are put in touch with the kind of product or service they want by a "barter broker," who works for the network.

"Say, for instance, that you own a mechanic shop and need your house painted, but the house painter doesn't need mechanical work," Vantrees said. "You go ahead and have the painter do $500 worth of work, you sign a voucher for $500, and the painter would then have that much money to use in the system any way he wanted. The mechanic would then owe the system $500."

Members say bartering can take a bit more work than paying with cash--and sometimes complex reasoning is required to do it--but that it's worth the effort.

"You almost have to be a wheeler-dealer type of person, a trader, to do it," said Pete Bundy, office manager for Buena Financial in Ventura. "But in this time of recession, it's just plain smart.

"A practical way we did it, for example, was with property that we had acquired that was of no use to us. We couldn't get out of it what we had put into it, and so we were just sitting on it. What we did was give SCM the land in exchange for trade credits, which we then used for accounting services, restaurant meals, letterhead printing, all kinds of things."

"In essence," he said, "we got top dollar."

Limited two years ago to a small number of goods and services around the county, SCM members today can obtain everything from auto repairs, clothing and jewelry to secretarial services, weight loss assistance and X-rays.

"I bartered for some real estate," said one local furniture importer, who asked not to be identified. "I gave some furniture to SCM, which they displayed for sale in their office or had in a warehouse. . . . I had the full value of that furniture in credits, which I used to get equity in a house."

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