Barter – A Detailed Perspective

1
Barter A Detailed Perspective
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2
What is Barter all about?
Barter can be regarded as the traditional trading
method of exchanging goods and services between
two interested parties without any involvement of
cash or money.
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3
Barter Basics

• This system resides parallel to the monetary
  system of our economy.
• Leverages are utilized as unused inventory.
• Barter holds the power of turning resources into
  purchasing capacities at the hour of need.
• Deals in replacing money as a method of exchange
  at any period of time.

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Progression of Barter

• It all started in 6000BC by the tribes of
  Mesopotamia.
• Was initially used in trading food items and
  weapons.
• Earlier Roman soldiers were paid in Barter
  through Salt.
• As per proofs, the purest form of Barter existed
  till 1874.
• Monetary crises and current recession situations
  fueled the revival of Barter System.

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5
Drawbacks of Old Barter System

• Opposition was not strong
• It was quite tough to measure the exact and
  proper value of the commodities offered in terms
  of exchange with each other. In most of the cases
  recorded, either the commodity or products
  offered was indivisible or a consensus wasnt
  reached.
• Double coincidence of wants
• Single party has no role in this kind of system.
  Exchange was only given a yes nod only if there
  was a deal from both the ends.
• Standard value was nowhere on the scene
• At those times, there was no medium available to
  measure the actual value of a commodity. The
  exact amount to be exchanged was always a big
  question during those times hence one or the
  other party had to suffer because of this issue.
• Absence of Store Value
• Saving wealth was not a system of those times.
  Most of the commodities of those times were
  perishable in the long run and non-monetary.

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Advantages of Barter System

• Reuse of unused inventory
• In modern times, even our unused inventory can
  also be used for exchange. These products or
  services can be traded easily in exchange of some
  value.
• Reduced cash expenditure
• By opting for barter, one opts for saving cash.
  In barter, any organization can buy products or
  services on barter. In this way, cash spends can
  be replaced by self made products.
• Raise the bar of your Sales
• The leftover or unused inventory can be used here
  to gain proper value under the terms of barter
  exchange. In this way, sales can be increased,
  thus paving way to the virtual cash.
• Give rise to a new market
• As per the recent reports, barter is expanding
  its horizons thus, leading to the pavement of new
  markets. The web of networks in the barter can
  actually lead to the chances opening up to the
  new markets.

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7
Todays Concept of Barter
In todays time, barter is known in the new form
called Corporate Barter. This form of barter pays
focus on bigger transactions excluding the
traditional and retail oriented barter exchange.
This kind of barter exchange involves the use of
media and advertising as the base of exchange for
transactions at corporate level. The unit called
trade-credit is used as the form of currency in
this kind of exchange.
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8
Scope of Barter in India Yes or No?

• As per the graphs, Indian retail sector is
  recorded as the next booming sector after I.T.
• After demonetization of India, 10-20 of Indian
  market inter firm transactions are happening on
  Barter.

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9
With all such equations, there is a clear YES for
the bright scope of barter in India.
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