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Natural Awakenings San Diego

ITEX in San Diego: Cash is Great, But Barter is Smarter

May 30, 2011 09:33PM ● By Susan Aimes

Arthur Kaliel’s first experience with “barter is smarter” may have been 20 years ago, but he still remembers it. “I worked for a small printing company in 1991, and I was curious to know how my boss could afford to treat my wife and me to such great dinners and top-notch vacations,” says Kaliel, a marketing agent for ITEX Corporation’s San Diego franchise office. “When I asked, he told me that his generous employee perks were possible because he accepted barter dollars from restaurants and resorts for his printing services.”

Kaliel liked the idea of barter dollars so much that in 1992 he went to work for Business Exchange International (BXI), which was bought out in 2005 by ITEX, the leading marketplace for cashless business transactions across North America. ITEX provides a stable and secure infrastructure for businesses to barter and has more than 90 franchisees and licensees, serving 24,000-plus member businesses nationwide.

The ITEX corporate office, located in Bellevue, Washington, debits and credits member accounts processing more than $300 million a year in transactions and provides 24/7 automated check authorization service via the Internet and by phone to ensure that all barter checks clear.

An ITEX checking account allows members to pay for their purchases with offsetting ITEX check sales, rather than cash. Every ITEX member enjoys new business and saves cash on every purchase. Ordinary bank checks and credit cards require payment in 100 percent cash dollars, but every dollar spent with ITEX checks can be paid with one dollar in new ITEX sales.

A member’s actual cash cost is only the cost of their inventory, so they profit by the amount of their markup. When making an ITEX sale, members must charge the same price to fellow members as to cash customers—prices may not be increased. Sales tax and shipping is paid in cash, and all sales up to $5,000 must be at 100 percent ITEX trade credits. For the portion of a transaction over $5,000, a percentage of cash may be negotiated.

“Initially when I joined, I took my ITEX checks home and showed my wife the $2,500 line of credit that every member gets when they sign on,” says Kaliel, who adds that he still recalls his wife’s skepticism. “After three days of cashless lunches, dinners, baseball games, Disneyland, hair appointments and new shoes, my wife endorsed it and said, ‘This is cool, let’s keep doing it,’” Kaliel advises. “To continue, I had to sell some printing for ITEX dollars.”

According to Kaliel, bartering is especially well suited to service-based businesses, such as printing, accounting, consulting or graphic design. In a service-based enterprise, income often depends upon the ability to charge an hourly wage. Time that isn’t accounted for doesn’t produce income, so a service’s business can benefit from using barter to turn excess hours into hard goods.

Just about anything can be purchased on barter. With ITEX’s national membership of more than 24,000 businesses, there are thousands of categories of goods and services from which to choose. “There are 1,700 ITEX members in the Greater San Diego area, and I keep adding more,” notes Kaliel. “Members tell me about other businesses they want to add to our directory, and I go out and recruit them.

“The more that members trade and the more referrals they bring me, the more cash they save, because they are paying with ITEX dollars,” Kaliel continues. “Many of our members are like me: Once they start bartering, they never want to pay cash for anything.”

Contact Arthur Kaliel at 760-613-6412 or [email protected]. Visit