The barter business is more popular than ever right now. There has been a resurgence in people using barter sites to trade for products and services they need. I work with a formal barter exchange so I know a little about how they work. Savvy business owners join local or regional exchanges and trade with like minded business who understand how effective trading is for their bottom line.

Formal barter exhanges give business owners the security of knowing that if a trade goes wrong there will be recourse for them. If people want to throw caution to the wind and trade at well known classified ad sites they'll be exposing themselves to being ripped off and the prospect of going through the legal system for compensation.

During slow economic times bartering becomes even more effective as you learn how to save cash while trading for what you need. There are people who barter almost everyday to dine at restaurants, visit spas, buy advertising, get limo rides, attend the theater, etc. Business people want to conserve cash during slow downs so they use common trading techniques to get more customers and ultimately cash during these times.

• The daily opportunity to save your cash while trading for what you need, be it carpet cleaning, electrical, printing, advertising, etc.
• Fantastic way to get rid of all that slow moving inventory you've got tucked away. List it on the exchange in return for barter dollars.
• Online barter companies often hold mixers where their members can get together and network. They exchange cards, make deals to promote each other's businesses and get good trading tips.
• Brokers at online barter companies can assist you with any trade. They can give you advice on how to trade or even do the trade for you at your request.
• Business members learn that they can also trade away their slow days. They make gift certificates for their service and list them on the exchange featuring their slow days. It's a great way to bring in customers who then pay in barter dollars. The barter dollars are saved to purchase services or products.
• You can also barter for your charity or cause.
• When you trade with exchange members they refer your business to family and friends creating cash paying customers. These new cash paying customers may turn into lifelong customers who also refer others to you.

There are many online barter sites to choose from. Naturally it's best to start out with investigating local exchanges. Do a "Google" for the terms (your city and barter exchange). You'll bring up local and regional barter companies. You're free to join as many barter companies as you would like. Quite a few business people are members of more than one barter exchange because each exchange has different members offering various services.

Each exchange is run differently. Some require you to pay a membership fee, monthly fee and transaction fee. Other exchanges may be free to join but you must pay a monthly and transaction fee which is a small percentage of each trade you do.

You must also read their membership agreement before joining as there could be a clause in there you don't care for.

Upon joining an online barter site, you'll be given a chance to choose your username, email login and password. You can pay whatever fees they charge with credit, cash or Paypal. Once a member, you can begin searching your exchange's online member directory. Here, services and products are listed for trade. You click on the listing and click the purchase button. The transaction goes through the software or whatever system they have set up for recording transactions and you receive an email notification that you have just traded. The details of your purchase are recorded and a separate notification is sent to the seller that you just purchased something from them.

You then contact the seller or most likely the seller will contact you and set up a place, time or shipping instructions for the completion of the trade.

When it's time to pay your monthly or transaction fees you'll receive an email or snail mail account statement with your recorded trades. The IRS views bartering and barter dollars to have the same value as regular cash, so you must keep your records for reporting the next time tax time comes around.

If you have a complaint about a trade gone wrong you simply contact your broker and tell them the details. Most people are honest with their listings and trades on exchanges. They want to maintain a good business reputation. There are a few rotten apples and sooner or later the word gets around the barter community that they can't be trusted.

Joining a formal barter exchange is not for everyone. There are business owners who are doing very well and don't need anything to complete their business.

But, exchanges offer more than just business related trading. You can also trade for vacations, hotels, cruises, golf courses, tennis lessons, boating, martial arts, spas, beauty makeovers, entertainment and of course the most popular being restaurants.

Formal bartering takes time to learn and it's ok to practice 'till you learn how to use it just like any other vital business tool. Once you begin to barter and see how simple it is and how you can save cash you'll wonder why you didn't look into it years ago!