As the economy worsens many small businesses are saving their highly-coveted cash by turning to the age-old practice of bartering, according to a recent New York Times article.

The informal exchange of goods and services between small business owners has been going on for a long time. Relatively new to the game, however, are online barter exchanges like U-Exchange.com. The Internet has extended the reach of bartering and made it possible for small business owners to meet other willing barterers that they wouldn’t have otherwise met. Also, it’s now becoming customary that these online exchanges enable their members to build credit that can be used for future transactions.

Bartering is appealing to strapped-for-cash business owners because it can find them new customers, both bartering and cash-paying, and it can help them conserve their monetary funds. Because of this, online barter exchanges have recently seen increases in both membership and transactions. Here’s an example from the New York Times of how members are using the service.

One new member at U-Exchange is R House Construction, owned by Rich Rowley of Tacoma, Wash. In a recent post on U-Exchange, he offered new home construction, remodeling, home repairs, real estate work orders, home maintenance and commercial improvements. In exchange, Mr. Rowley is looking for vacations, real estate, homes, land, dining, medical care, dental care, a boat, a motor home, groceries, gas, entertainment, a ski pass and tickets to Mariners baseball games or Seahawks football games.

Barter exchanges are a great way to start conserving your cash, but be warned. You must be careful about how much of your business comes from bartering. “Experts recommend that a business use barter for no more than 5 to 15 percent of sales to avoid crowding out cash business.”

      del.icio.us   SphereIt   Reddit   Furl