IOC makes strategic addition to business model
IOC announced today that, effective 2018, a new domestic corporate barter division will be launched. This division will take IOC back to its original roots in dealing with domestic and international corporate barter clients. Founded in 1987, ABS worldwide, the predecessor to IOC, was one of the country’s foremost corporate barter companies dealing with Fortune 1000 companies domestically and multinational companies globally to assist in the acquisition of new clientele and in the reduction of bottom line cash expenses.
By opening this division, IOC will be able to finalize its total blanket strategy to now be able to extend its global countertrade and offset clients while expanding into the commercial corporate barter arena servicing corporate clientele.
Barter is usually multilateral (i.e., mediated through a third party) and, in most developed countries, usually only exists parallel to monetary systems to a very limited extent. Barter, as a replacement for money as the method of exchange, is sometimes used in times of monetary crisis, such as when the currency may be either unstable (e.g., hyperinflation or deflationary spiral) or simply unavailable for conducting commerce.
Barter may occur in commercial economies, usually during periods of monetary crisis. During such a crisis, currency may be in short supply, or highly devalued through hyperinflation. In such cases, money ceases to be the universal medium of exchange or standard of value. Money may be in such short supply that it becomes an item of barter itself rather than the means of exchange. Barter may also occur when people cannot afford to keep money (as when hyperinflation quickly devalues it).
Since direct barter does not require payment in money, it can be utilized when money is in short supply, when there is little information about the credit worthiness of trade partners, or when there is a lack of trust between those trading.
Barter is an option to those who cannot afford to store their small supply of wealth in money, especially in hyperinflation situations where money devalues quickly.
More prevalently, Barter is used as a strategic advantage in order to reduce the net costs of commonly budgeted items while at the same time serving as a source for new clientele.
Corporate barter usually works through media placement which the business community is led to believe is the best avenue to unwind barter credits. This has been the traditional way for barter companies to unwind their obligations to the clients. However, most barter clients are now learning that through the use of media and their traditional use of the credits, the barter credits actually end up being of no value (see article below).
IOC’s approach to working with its clients to unwind trade credits is substantially different than that of the industry and the larger barter companies. IOC make sure that the trade credits equate to actual hard dollar savings through the application of benchmark pricing of IOC’s purchasing programs. IOC’s purchasing programs have led the industry for their creative solutions and true hard dollar cost reduction.