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Barter builds relationships By Shari Downhill A captive fighting fish in a hydroponic plant vase on Don McCoy�s desk is a symbol of the symbiotic relationships he�s worked to build over the past seven years. The conversation piece was created by a member of McCoy�s Medford trade exchange, representing a tiny fraction of the millions of dollars worth of goods and services that group members trade each year. McCoy started the Society of Trading Associates in 1993 to serve the Rogue Valley and surrounding areas, convincing a few brave charter members of the benefits of barter. By 1997, SOTA was processing $7 million in trade volume annually. In August, McCoy joined forces with Clackamas-based Compass Trade Exchange. The marriage of the two resulted in one of the top 10 bartering clubs in the country. Operating under the name and administrative structure of Compass America Ltd., the new 1,600-member company plans to launch a Web site within the next six months and a travel service by February. The site will allow members to check account balances, search directories for goods and services, transmit barter currency and add classified advertising. "For our customers we tried to make (the transition) comfortable," said Compass President Matthew Humphreys from his Clackamas office. Customer confidence is vital in the barter world to maintain stability in the trading arena, says McCoy, Compass� new regional trade director. Barter groups have become more sophisticated and better organized since farmers and merchants first survived by trading livestock for dry goods and homestead supplies. Like other trade groups around the country, Compass uses its own currency as a method of payment for goods and services offered by exchange members. Trade dollars are used to both buy and sell and are valued equivalent to the U.S. dollar. McCoy�s decision to bring SOTA under Compass� umbrella was based on the strength of the Clackamas company�s accounting system and the simplicity of its trading protocol, he said. Humphreys said Compass will soon take on eight more trade companies, expanding into five additional major markets including Seattle, Boise, Salt Lake City, Phoenix, and Anchorage, Alaska. That means Compass will be on the same playing field as barter big-hitters such as San Francisco�s Bigvine and Seattle�s Ubarter. Without counting SOTA�s 2000 trade volume, Compass generated more than $7 million in member trade last year, Humphreys said. With the addition of SOTA, a functional Web site, travel service and expansion into five urban markets, Humphreys expects to double or triple growth this year. "In 1999 we did about $3 million in volume," he said. "We did that in the first two months of 2000. Conservatively, we estimate $12 million to $20 million this year." The value to members in such a large barter group is the vast selection of bartered goods and services on which to spend accumulated trade dollars. Anything from real estate to produce, carpet cleaning to architectural services can be bought and sold through Compass� member network, McCoy said. With each transaction, Compass charges a 5 percent fee. New members, either businesses or individuals, are charged membership fees, which were charged under SOTA, McCoy said. Members also no longer are required to collect the transaction fees and redirect them to the barter group for payment. "Really, our biggest challenge now is the quality of customer service," says Humphreys. "With growth as fast as we�re experiencing, it�s being able to educate and serve our customers." Revenue from barter sales is reportable as business income for annual trade activity of at least $600. Although both businesses and individuals will receive 1099B income tax forms, the tax code allows an exemption for individuals selling previously owned items. Reach reporter Shari Downhill at 776-4463, or e-mail [email protected] . Mail Tribune Home | Ottaway Newspapers, Inc. | Dow Jones & Co., Inc. | Privacy | Contact Us Copyright � 2000 Mail Tribune, Inc.