Much before man knew money, he knew barter. A sack of rice in exchange for a kiloliter of milk or dowry in exchange for a bride, barter was and barter is prevalent in all walks of life. Strange then how the corporate world had ignored it for this long. But, Bangalore-based Barterbiz is hoping to take corporates back to the basics of doing business with barter.
A small company till 2002, Barterbiz was then bought over by Arvind Kumar and Satish. These two entrepreneurs had witnessed a lot of barter in media while serving their tenure in various media houses like The Times of India, Asian Age, Deccan Chronicle and Zee. This experience and the vision to make barter big in India has today made Barterbiz a Rs 20 million turnover company.
Arvind Kumar, Director, Barterbiz, said, “Companies are already used to the concept of barter, especially with all the media deals, but they only know of direct barter.” This is where Barterbiz makes the much required difference.
Satish, the second director of Barterbiz, explained that it was easy to make direct barter deals, but when two like minded parties were unable to get on to the same platform at the same time, facilitators like Barterbiz came to their rescue.
Barterbiz had a “chain of clients”, as explained by the two partners. They shuffle the barters between these clients to cater to each one’s needs at any given point in time and 10 per cent commission of the deal goes to Barterbiz (that’s in cash!).
All deals happen at the standard market price, and entities that do not have a market price are evaluated by their realistic price, which is agreed upon by the clients and Barterbiz together.
“Book keeper of the nation”, as the they describe barter business, in their estimate, would grow to Rs 800 crore to Rs 1,000 crore in the next five to seven years. Barterbiz’s 20-member team is spread across Bangalore, Chennai, Kochi, Hyderabad and Mumbai, caters to around 150 clients across India, including The New Indian Express, Jaya TV, Sanjay Khan’s Golden Palms, Orchid, and Eureka Forbes. They claim to be the largest player in the southern markets with Zee’s Intrex coming closest to them.
“There is no cannibalisation into the cash business and a so barter is always a win-win situation for all parties involved,” says a confident Arvind Kumar. There sure seems potential in this formula of business. So the next time a company wants to strike a deal, they have the option of asking, Cash or Kind?