Goods-for-goods schemes take off as firms seek to cut costs in economic crisis

DOES your small business need a new computer system, or a few thousand dollars' worth of printing? Are you short of cash to buy these supplies because, thanks to the economic crisis, traffic is down at the restaurants you run? Alternatively, are you on the lookout for someone who needs, say, 150 tonnes of steel girders because the construction company that ordered them from you has gone out of business? You might be ready to barter - or countertrade, as the experts call it. If so, check out one of the barter clearing houses springing up in Hong Kong.

The trick is to trade goods for goods, not cash. However, partners for direct trades of this sort can be difficult to find - after all, the company that wants your girders might have nothing that your company needs in return.

So barter clearing houses act as middle-men. Client companies are put in touch with each other and negotiate their own deals, then the clearing house takes a commission.

Kelly Law Sau-woon, assistant financial controller at the Pruton Prudential Hotel in Kowloon, said her hotel was the first in Hong Kong to join Barter Trade Exchange, a Hong Kong joint-venture partner of Australia's hugely successful Bartercard.

Since joining the scheme in March, the hotel has received more than 40 bookings from customers who pay by Bartercard, using 'trade dollars' earned by bartering their own products with other members of the scheme. It has been worth HK$70,000 in extra business.

Meanwhile, the hotel has spent the equivalent of just HK$7,000 in trade dollars on, for example, wine and printing. But it plans to splash out plenty more, starting with a new light box for an illuminated sign on the roof.