If Cash is King, Barter is Queen

As the economy edges toward recession, businesses are likely to look for ways to reduce their costs, and barter may be one of their options. 

Cash is King. We’ve all heard this expression, and with businesses getting squeezed from all sides, it’s time to conserve cash until the storm passes. Barter is designed for this purpose as businesses trade their goods and services with other businesses on a cashless basis. Most barter exchanges have transaction fees so there is some cash costs, but this is minimal. 

What can be traded on barter? Well, just about anything from services to supplies and even healthcare. Take MedIBarter for instance. The company has launched a barter exchange that helps businesses access healthcare with trade dollars created through business to business trades and provider to business trades. Providers can also trade with each other making the platform a go to exchange for the healthcare community.

MediBarter offers free accounts for its members’ employees allowing trade credit to be allocated to employees for healthcare. As an example, a business can allocate $250 in trade dollars to each of its employees for anything healthcare related. Since barter is treated as income, trade dollars allocated to employees can offset barter income.

Although it’s worth checking with a tax professional on how barter income is treated and what can be deducted, barter can be a strategic option for conserving cash during bumpy times. While cash is king, barter and cash conservation can go hand in hand which is why it’s the queen.