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BizXchange Expands Barter Finance Services As Businesses Face Credit Crunch
BizXchange provides loans and lines of credit for qualified members and brings new customers to the business to pay back the loans.
Seattle, WA - October 16, 2008 - BizXchange (BizX.com) has expanded their Business Barter Finance Services, offering expanded credit services for members facing tightened credit through traditional lending institutions.
The Seattle-based business-to-business barter exchange, with additional offices in the Bay Area and Dubai, has previously provided financing to members on a limited basis but has expanded these services for members facing the current credit crunch. BizX currently has over 1500 members and has conducted over $150 million in barter transactions since it began in 2002.
“If banks aren’t loaning, and if you’re a BizX member with a product or service other members need, we can provide loans and lines of credit to finance needed purchases to grow your company,” said Bob Bagga, president and CEO of BizXchange.
BizX and other modern trade and barter exchanges are providing new sales avenues for businesses facing the credit and cash flow crunch—allowing members to tap into their own underutilized capacity to trade for products and services they need to run their businesses.
“Businesses see trading with BizX and other exchanges as a way to get the most out of excess inventories and underutilized staff as the economy continues to slow,” said Bagga.
“Similar to a lending institution, we prequalify each member applicant for loans and lines of credit. Our criteria focuses on the company’s size, the quality of the product or service they have to offer and its appeal to other members,” said Bagga. “Typically, applicants are seeking financing for larger, one-time expenditures beyond their normal business barter needs, including advertising campaigns and construction projects.”
He cited two recent examples of members taking advantage of the BizX financing program. One established Seattle restaurateur opened a restaurant in the up-and-coming South Lake Union area using a barter line of credit to finance some of the build-out costs. Another example is a Puget Sound area contractor that took out a $40,000 barter line of credit to launch an advertising campaign that included print, radio and signage. Both of these companies are now getting new customers through the BizX network to pay down the financed credit. Any financing that businesses establish through BizXchange is paid back through increased sales to other members of the exchange.
Bagga noted that while not all BizX members qualify for the financing, they can work with the BizX account team to take advantage of conventional trade and barter services offered by the exchange to help them meet such on-going business expenses as printing, advertising, professional services, business entertainment and other items.
Whether it is a large line of credit or conventional business barter, BizX acts as an external marketing channel for a company and brings new customers to purchase a company’s products and services with BizX dollars. BizX account managers actively support a company by connecting them directly with other members to make sales or purchases.
Modern trade and barter differs from direct “company-to-company” barter, which limits participants to using only what an individual company has to offer. Membership in BizX allows businesses to trade within a large pool of other member businesses. Members buy and sell products and services with other exchange members using “BizX dollars,” which are equivalent to U.S. dollars. BizX acts as a third-party record keeper, just like a bank, providing monthly statements and current dollar balance.
According to David Wallach, president of the International Reciprocal Trade Association (IRTA), business-to-business barter is expanding rapidly. He estimates that over the past 30 years the number of barter exchange members has grown from 12,000 to over 400,000.
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