Barter Trading Frequently Asked Questions

Barter is an important financial tool that helps business owners build their client base and improve cash flow. Learn more about barter by reviewing the answers to frequently asked questions about barter with Hudson Barter Exchange.

Q. What is barter?

Q. What are the advantages of barter?

Q. Why join Hudson Barter Exchange?

Q. How does barter work within Hudson Barter Exchange?

Q. What does it cost to get started in Hudson Barter Exchange?

Q. How does Hudson Barter Exchange make money?

Q. How can one trade more profitably?

Q. Are there any unusual uses for barter?

Q. Suppose I want to spend more than what is in my trade account?

Q. Are there any tax advantages to barter?

Q. How do I know how much barter income to include on my tax return?

Q. Who decides what prices the seller will charge on barter?

Q. Can I charge part cash and part trade?

Q. How do I know that the members of HBX are quality providers?

Q. How do I get started in Hudson Barter Exchange?


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Q. What is barter?

A. Barter is a way of transacting business without the use of cash. You can buy what you need and pay for it with what you have. A sale is made that would not have been if cash were required. Plus, there is an immediate increase in cash flow when one trades for an expense that would otherwise be paid for in cash.

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Q. What are the advantages of barter?

A. There are several, with the foremost being new business. Barter provides you with new clients and allows you to expand your market beyond your cash-paying accounts. Barter also helps in conserving cash. Instead of spending cash to purchase goods and services, you can barter your own goods and services to pay for those things you need. Thus, more cash stays within your business, providing increased cash flow. Barter puts idle resources to work. Excess time, inventory, and capacity are converted into profits.

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Q. Why join Hudson Barter Exchange?

A. The problem with the one-on-one trading that you are accustomed to is that each business owner must need exactly what the other has to offer. In the Hudson Barter Exchange barter network, everyone trades with everyone regardless of what the other person has to offer. A printer might not need the CPA he is printing for so he will use his barter dollars from the job to buy the advertising he needs. Barter Dollars are credited to a trade account with Hudson Barter Exchange, which can then be spent on any item or service needed or wanted from within the network.

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Q. How does barter work within Hudson Barter Exchange?

A.Clients of Hudson Barter Exchange use Barter Dollars instead of cash to handle their transactions. For example, if a client sells $1000 worth of products to another client, they will receive $1000 in HBX Barter Dollars credited to their Hudson Barter Exchange trade account. These Barter Dollars can then be used to purchase from the other trading clients within the HBX network. Hudson Barter Exchange is a third-party record keeper, providing monthly statements to clients, which reflect their purchases, sales, fees and current barter balance.

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Q. What does it cost to get started in Hudson Barter Exchange?

A. There is a one-time membership investment and a modest monthly administrative fee. Visit our sign up page for detailed information on our fee structures.

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Q. How does Hudson Barter Exchange make money?

A. There is a 7% cash transaction fee on sales and purchases. This represents a fee for generating new business for clients of our exchange network. Trade business provided is NEW business from NEW clients over and above your standard cash clients. Most business owners feel justified in paying a small percentage to acquire new business. This fee is Hudson Barter Exchange’s main cash producing vehicle, necessary to keep the exchange operating on a financially responsible basis.

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Q. How can one trade more profitably?

A. Don’t limit yourself to worrying about one or two large one-time purchases. Look at your business checkbook for the last 12 months as a memory aid. Think too, of your personal needs. If you regularly take cash out of your company for living expenses like travel, home improvements, etc. why not take out barter income instead and save your cash for products and services that Hudson Barter Exchange may not be able to supply?

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Q. Are there any unusual uses for barter?

A. Yes.

Barter provides limitless opportunities. Here are just a few creative ones:
Pay Employees. Use HBX Barter Dollars to pay employee benefits, bonuses, and perks or even pay a portion of their regular salaries in trade. For a nominal fee, we will set up employee sub-accounts and assist your employees in spending their HBX Barter Dollars.

Pay Bills. Use HBX Barter Dollars to pay some of your outstanding cash bills. If you owe a vendor money for a product or service and you just don’t have enough cash to pay – talk to them about barter with Hudson Barter Exchange. If they become part of our network and you have a trade balance to cover the amount owed to them – then you can immediately pay them.

Collect Past Due/Receivables. Businesses that are unable to pay money they owe you would probably be very willing to pay you with their product or service. You may not need these offerings directly, but Hudson Barter Exchange may have a market for their products. So phone Hudson Barter Exchange with the specifics and we may be able to move their products. We do this by creating their own account at HBX or we can process through your Hudson Barter Exchange account, and credit your account when the products or services have been sold.

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Q. Suppose I want to spend more than what is in my trade account?

A. The standard policy is that you must have the HBX Barter Dollars earned in your Hudson Barter Exchange account from previous sales to cover all purchases. If and when credit is requested, it is handled on an individual transaction basis. All loans are subject to a small per month compounded interest charge on the unpaid balance and subject to the provisions in The Rules and Regulations of The Hudson Barter Exchange Contract Agreement and General Trading Policies and Procedures.

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Q. Are there any tax advantages to barter?

A. There are no tax advantages or disadvantages to barter. Barter income is the same as cash income for tax purposes. Trading should be considered a marketing tool, not a tax tool. As with cash income, however, trade purchases that are business related are also tax deductible.

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Q. How do I know how much barter income to include on my tax return?

A. At the end of the year, Hudson Barter Exchange totals your barter sales and submits this information to the IRS on the form 1099B. You are also mailed a copy of this form for your records.

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Q. Who decides what prices the seller will charge on barter?

A. Essentially, the market determines pricing just as it would for cash. The seller is expected to trade their goods and services at their full, fair prevailing prices. By accepting or rejecting prices, Hudson Barter Exchange members are ultimately the determining authority in the pricing integrity. Hudson Barter Exchange Brokers keep in constant contact with Members to monitor fair trading policies.

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Q. Can I charge part cash and part trade?

A. HBX is committed to 100% barter transactions so that all members of the exchange benefit. In some instances when parts need to be ordered, a cash component might be essential. In that case, HBX must approve the transaction in advance.

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Q. How do I know that the members of HBX are quality providers?

A. Most of the growth at HBX comes from within the group or one of the organizations we belong to so most new members are referred. Despite that, HBX will search various databases and online review sites to see if there are any issues with any provider before we activate them. If you are the first member to use a provider, we will let you know that. The work done by an HBX member is usually reported back to us so we can keep a running list of referrals for HBX members to check on. We have a short leash for incompetence or misbehavior…it is only fair to the collective membership.

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Q. How do I get started in Hudson Barter Exchange?

A. Simply go the the Sign Up section of this website and fill out the form. A member of our staff will contact you to explain how you can become a member and get the most from your HBX membership.

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