Cashless trade between small businesses brightens giving season
It’s giving season, so there are loads of parties going on this time of year.
But a recent holiday bazaar in Seattle's Georgetown neighborhood is the work of a unique entrepreneur, with a special spin on networking.
He has helped thousands of small companies to survive and even grow during the Great Recession.
He has bushy eyebrows, a bright purple-and-yellow striped tie. And he seems to know everyone in the room. Bob Bagga, the CEO of BizXchange warmly greets pretty much everyone he encounters at this party.
He founded this company just over a decade ago. At that time, we said he was kind of like an Alan Greenspan of Seattle.
He has dozens of employees now. And his work has helped a couple thousand other small companies.
BizXchange is a club of business owners who support each other through thick and thin.
"And we do well in thick and sometimes even better in thin,” Bagga says with a laugh.
Members of the exchange pay dues on bartering between one another. They don't have to barter directly, which means they can more easily get what they need, when they need it, without paying cash.
Instead, they offer a service or goods in the exchange's alternative currency, called BizX dollars. The exchange rate is one-to-one with U.S. Dollars.
Bagga himself is able to hire employees and pay them in U.S. Dollars to run the exchange, which he calls a community, because (for example) they actively mentor members who ask for help,
“It’s a complimentary currency, where this community of businesses come together to help each other," Bagga says. "And they’re able to generate new and incremental sales, from each other within the community. And then use this alternative currency in place of cash, resulting in the end with increased sales and increased cash flow.”
Among the happy users of BizX is the owner of the Lake Forest Park Bar and Grill and of Lunchbox Laboratories, John Schmidt.
He says instead of laying people off, he's been hiring...and adding restaurants to his chains.
“They’ve helped us keep cash in our pockets. So when we do plumbing on BizXchange or when we buy marketing or we are occasionally able to buy salmon, able to buy wine. It keeps our cash in our pocket. And we of course have to trade the same amount back out again, but it comes out at a pace that is barely noticeable,” Schmidt says.
And he can offer his employees holiday bonuses, in the form of gift cards for things they need, such as dental work.
Many business owners here also say they like it, because BizX’s form of bartering is above board and on the books.