Service offered

Oxley was skeptical at first, then talked with some friends who were KTE members and decided to join the exchange. Gradually, cash-flow problems eased and she could see light ahead.Businesses gain new customers because barter exchanges can function as a marketing tool.

Trade deposits came in the form of indoor advertising. When the Oxleys moved from a home-based business to an office building in 2004, Laura Oxley said the company used trade credits to pay for 85 percent of the move, including painting and buying the phone system and furniture.

Oxley said she has done $50,000 to $60,000 in trade business in each of the past two years while intentionally keeping it to 20 percent of total sales.Six months after 9/11, Wichita's E.L. Bailer Indoor Advertising was facing bankruptcy. "We were probably 90 days away from being gone," co-owner Laura Oxley said. "It was pretty bad." And then she ran across Kansas Trade Exchange, a business-to-business bartering company that operated in Wichita at the time. She learned how bartering could conserve her cash flow and initiate new business.

The business receives a trade credit based on the dollar value of the good or service offered. It can then use those trade credits to "purchase" goods or services offered by other members.

Industry experts stress that bartering income is taxable income. Barter exchanges are required to report transactions to the Internal Revenue Service.She said bartering has been a significant reason business has tripled since she and her husband, Ken, bought the company in 2000."It's worked beautifully," Laura Oxley said. "I don't know what we would do without it."

A business selects its trade deposit from its service downtime or excess inventory. It then tries to turn that deposit into a valuable commodity by listing it for trade through a barter exchange.Simply put, third-party bartering involves an equal trade. Exchanges work like banks, except businesses make trade deposits instead of cash deposits.

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