ABC7 On Your Side: The Business of Barter
May 11, 2009 (WLS) -- People who are struggling financially are trading the use of cash and credit cards for an old fashioned system.
If we go back in history or to other parts of the world we see the origins of business. Without currency it's simple: I'll trade you for something.
Now with money tight barter is making a come back. Chicagoans are getting creative and finding ways to capitalize on their talent and trade.
Hairitics: dye for your beliefs is a clever play on words for a hair salon. The salon's owner is also crafty by making her business work for her. She advertised to barter on line. Trading her hair expertise for what she needs.
"It was just like, what do I need. I just need to pick what I need," said Julia Regalado, Hairitics.
A few months ago, she bartered for professional photos of her daughter.
"This woman responded and she took wonderful pictures. She got her hair cut, her hair colored. She looked wonderful. We were both happy," said Regalado.
Craigslist reports in the last twelve months bartering has increased 120 percent. Much of that is individuals trading directly for a service, but the bartering business has become more sophisticated.
There are networks where the businesses do work or trade products for barter dollars, then the business can use those barter dollars on any of the other businesses in the network.
About half of the clients for Northeast Illinois Heating and Air Conditioning come from barter referrals. The company's been around for 26 years and uses its barter dollars to service its vehicles and for a down payment to buy their office building.
"These are trade dollars but they still have value and we can use these dollars to buy things that we'd otherwise be spending cash for and this helps us to conserve our cash," said Michael Rodriquez, Northeast IL Heating & Air Conditioning.
On this day, Northeast Illinois Heating and Air is doing spring maintenance for the fireside restaurant on Ravenswood on barter. Both companies are members of Itex in Chicagoland - an international barter exchange.
Fireside's owner barters meals for many products and services, even staff vacations. Instead of bonuses, his business manager went to Aruba.
"I had these extra barter dollars that i'm gonna use to buy a vacation for you. actually she went there five years in a row. she did a great job five years in a row," said Rich Wohn, Fireside Restaurant.
Limo driver Royce Kimmel saw a drop in business at end of last year, but he had banked barter dollars with the Art of Barter, a local barter exchange out of Elgin. Kimmel was able to service his fleet and enjoy a few holiday meals thanks to barter.
"I was able to dip into my barter which works just like money and i was able to buy services," said Royce Kimmel, Trax Limousine.
Nick Hansen has taken limo rides, placed ads and got flowers for his wedding with his Art of Barter dollars. He is a men's custom clothier and found that his four old business benefits long term when barterers walk out with one of his suits or shirts.
"It gets more people in the street wearing our clothing which in turn brings in more people because they love the experience and they love the fit of the clothing," said Nick Hansen, Nicholas Joseph.
Tradesmen and women with a skill that's universal seem to have the most success bartering like the hairdresser, carpet cleaning, computer repair, car repair and website design.
The Art of Barter has seen a 25 percent increase in enrollment since the fall and Itex in Chicagoland is up 40 percent. Any business or contractor can register with one of the barter exchanges.
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