New Barter Network Spread Through Town in 2011

When representatives from California Trade Bank opened a Santa Cruz branch, they were sure the town was perfect for their services. Eight months later, they have a network of about 80 local and regional businesses that barter with each other for services.

The list of local businesses that offer services for trade includes 99 Bottles Of Beer On The Wall, Pleasure Point Computers, Hayes European Auto Service And Parts, and dozens more.

Members can also trade with companies in the bank's global network of 250 trade banks around the world.

“Santa Cruz is a community that already loves to trade," said Steve Addi, director of sales and marketing for California Trade Bank. "Almost every business we have talked to already barters in some way. We are expanding the services they can get through trade.”

The roster includes restaurants, art dealers, auto repair shops, contractors, even dentists. The trade bank's goal is to have 150 members by the end of 2012. There is a one-time membership fee of $400 to join the network. The bank supports itself beyond that with a 5 percent fee from both the customer and seller involved in each trade.

Steve Hager, who owns Hager and Hager Quality Used Furniture And Fine Art, said the trade bank is perfect both for new businesses strapped for cash and for more established ones going through a slow period. The trade bank really got the ball rolling for Hager in sales of his overstocked art inventory.

“I joined the trade bank for one reason: What could they do for me?” Hager said from his gallery on 17^th Avenue in Live Oak. “I had an abundance of art, because people backed off on spending, and [the trade bank] said they had people that wanted art.”

When trade dollars are used, the seller or worker gets top dollar, which is unusual in the art business, where deals are often cut if a buyer has cash.

The bank and member businesses stress that a business can't exist purely on trade. Hager said trade work must be considered part of the profit margin rather than a way to pay month-to-month bills. This is especially true for contractors, because Home Depot is not going to accept trade for supplies.

"A contractor who is out of work might charge for supplies and put the labor on trade," he said. "They can get full price for their labor so that can work out pretty well for them."  

Addi adds, “We don't want to interfere with anybody's cash business, and are always sending them referrals for cash jobs at no charge. That is just part of the service we provide."

The trade bank handles the financial pieces of trades, requiring its members to fill out tax forms, and keeps track of accounts.

Sara Lewis, owner of Monarch Cove Bed And Breakfast in Capitola, said she has worked with trade banks in the past with mixed results. She said Addi and company have been great to work with and have increased business at a time when vacation is out of reach for many people, even business owners.

“There's nothing like trade when it works," she said. "This group really takes an interest in what your needs are and get it for you, rather than setting up a network and letting it run on its own.”

A full list of local members and more far off partners like travel agents who trade for vacations in overseas time shares is available by clicking here.