Tuesday Report - March 20, 2001

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March 20, 2001

CEO Extols Barter As Life Saver In "Spend and Burn" Dot.Com Environment

Mair Faibish, Chairman and CEO of Synergy Brands, recently sent an open letter to all shareholders. His comments included, "While the shut downs of so many 'spend and burn' dot.com competitors have unfortunately cast a dark shadow over all remaining dot.com companies, the business effect on companies like ours is extremely positive. From a financial standpoint we are stronger than ever."

He also told his shareholders that because they "have been using barter to secure advertisement and promotional opportunities," the company's future looks exciting.

While other dot.coms spent millions on mass media, Synergy Brands was bartering, and in a somewhat different manner. "If not for barter, we would have had to pay cash to buy the products from the manufacturers."

However, Faibish worked with a major media barter company and exchanged advertising for grocery products that he then cashed out through his DealByNet.com site to independent grocers. Needless to say, he's happy with the results, "It's been a fantastic way for us to reduce our product acquisition costs."

All three of Synergy Brand's e-commerce web sites have reportedly used barter as the instrumental factor in helping diversify their marketing approach, giving them a combined annual revenue of roughly $22 million.

The Sinclair Broadcasting Group, which owns or operates 62 television stations in 40 markets is the largest shareholder of Synergy Brands. Premier Radio also played a role in the company's success by providing $1 million in radio advertising in exchange for stock.

Jim Rossner To Direct BarterNet Operations

Jim Rossner, who joined BarterNet, www.barternet.com, in March 2000 to serve as their chief marketing officer, has been promoted to chief operating officer.

In his role as COO, Rossner plans to continue his oversight of BarterNet's marketing function, as well as the company's business development, technology, and other company operations.

"We're looking to change the face of business trading, shaping it into a practical business tool that every company can use to improve their profitability," he stated.

Rossner has over 20 years of marketing, sales, and consulting experience. As vice president of marketing he repositioned Angara E-Commerce Services from a software company to an application services provider in the business-to-consumer marketplace.

He also helped iSearch, a business-to-business e-commerce services company, target its Fortune 2000 customer base with an integrated marketing campaign.

At Datalink.net, Rossner launched a fully integrated internet e-commerce web site and affiliate program to strengthen the company's marketing position.

Australia's BBX Aids Private School

With an annual trade volume of $100 million, BBX is one of Australia's top trade exchanges. Recently the company provided aid to a private school—Redfield College For Boys—with a $300,000 interest free construction loan. Along with additional bank financing it will fund a new student housing effort for the school. The school will repay the $300,000 loan with donations, as they come in.

BBX Ltd. was Australia's first trade exchange to specialize in the building and construction industry. Now they have opened a new division of the company—BBX Building—which focuses on providing assistance for builders, developers, and trade contractors.

Here And There. . .

In earlier newsletters we reported on Starwood Hotels & Resorts Worldwide awareness and use of trade through barter companies. Now the company has come up with another barter incentive that's sure to get the attention of many...they're trading a Porsche convertible to the employee (at the hotel's White Plains facility) with the best energy-saving ideas.

BarterTrust's Chief Financial Officer and Chief Operating Officer Scott H. Ray has left the company to join OpenTV, an interactive television and media solutions company. He will become OpenTV's CFO.

Klaas Weima and Marco Kloots from the Netherlands visited the U.S. six months ago, visiting several West Coast exchanges for their barter research effort. The study was a joint-research program between BeHand.com and the Erasmus University, Rotterdam. Congratulations to the two gentlemen for completing and publishing their research findings.

A sign of the times...looking back on the Old Economy and realizing it still has value. For years Moore Corp., one of North America's largest providers of printed forms and labels, blamed its shrinking earnings on declining demand for paper-based products. Consequently, the company pinned its future on selling computer programs that would perform functions once handled on paper.

But the road to becoming a software concern was proving bumpier than expected, and now new management says it's abandoning the digital push and placing its hopes on the Old Economy. They believe it will be paper, not computer technology, that will turn Moore back into a moneymaker as most consumers still want printed bills, bank statements, receipts, and the like on paper.

A new study says that compared with male entrepreneurs, many women avoid selling equity even thought it often is the path to fastest growth. Moreover, women are much more likely to rely on credit cards and personal loans—an expensive way to finance a business—than their male counterparts.

The study was based on interviews with 2,000 business owners last fall by the National Foundation for Women Business Owners, a Washington, DC, research firm. Editor's Note: Given these facts, women business owners would be the ideal candidates for membership in a local trade exchange.

Response to credit card offers continues to drop off. The typical American household received more than three such offers monthly last year. Card issuers mailed a record 3.54 billion solicitations, up from 2.87 billion the year before. The response rate was 0.6%—about 1 in two hundred people respond!—compared to a 1% response in 1999.