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        REA-10          Existing facilities.           January 8th,  1986

                            Existing facilities.

        It is a conventional understanding that almost any new venture is 
        essentially competitive.

        Either in competing for a share of an existing market, or by 
        creating a new market sector drawing business from all others, 
        and within which other competing ventures will arise.

        By contrast, a LETSystem is essentially a non-competitive 
        organism, neither competing with existing institutions nor 
        inviting competition against itself, but simply realizing 
        community resources.

        (The only significant exception to this is discussed below.)

        An orchestra can play different music with a different score or a 
        different conductor, without having to change the instruments.

        The LETSystem itself should represent this idea as fully as 
        possible, making use of whatever facilities are already available 
        in the community rather than seeking to establish its own.

        Most people in business are acutely aware of their competitive 
        position, and especially sensitive to the idea that they might 
        lose something, like business.

        Whatever computer facilities are used, perhaps even established, 
        to support LETSystem administration, should be independent of the 
        LETSystem itself.

        All printing etc, should be subcontracted in preference to empire 

        At the same time, responsibility to membership requires that the 
        administration use minimal cash in managing expenses.

        Where a monopoly situation on, say, printing or publicity, is 
        being exploited, all efforts should be made to establish 
        comparable facilities operating as green as can be.

        The cashflow advantages of operations of any sort that will take 
        green in part will generally ensure the viability of such 

        Landsman Community Services Ltd.              REA-10    Page    1

        REA-10          Existing facilities.           January 8th,  1986

        Many people will look on a LETSystem as though it is some sort of 
        club, to which they might in some way belong, which offers 
        certain exclusive privileges and a protective environment.

        Yes and no.

        For example, there is no limitation on the number of plumbers, or 
        car dealers, or whatever, that may participate in any LETSystem.

        Let things sort themselves out.

        The LETSystem must be clearly understood to be entirely different 
        from such organizations as the tradesmens' groups which guarantee 
        performance, restrict membership and provide publicity services.

        Landsman Community Services Ltd.              REA-10    Page    2

        REA-10          Existing facilities.           January 8th,  1986

        The particular exception to the rule that a LETSystem presents no 
        threat to anyone is the commercial "barter" network.

        These systems are prevalent in North American cities, and are 
        developing to a greater or lesser extent all across the world.

        In their own best interests, it is imperative that the people who 
        are currently operating these systems appreciate that it will 
        soon be entirely impossible for them to do so without essentailly 
        becoming LETSystems.

        The only significant exceptions to this, for the meantime, are 
        those major agencies which manage large asset exchanges and often 
        act themselves as intermediary traders, or otherwise guarantee 
        the trading credits they record.

        The current level of performance of the smaller operations can be 
        far excelled by LETSystems at a fraction of the costs and charges 
        typical throughout the industry.

        All these operations are impeded by their stance as quasi-banking 
        institutions and their insistence on cash commissions.

        Most compound their problems by insisting that all trading must 
        be in their credits only, a ruling that makes useful trading 
        extremely difficult for any business that needs hard cash for 
        direct costs that cannot be met in trading credits.

        Major costs in sales and maintainance are necessary to even hold 
        the minimal percentage (usually only 1-2% of businesses in 
        number, and a minute proportion of business in $) of the 
        potential market.

        LETSystems will quickly be able to provide better information 
        services, through a vastly expanded trading community at a 
        fraction of the charges currently levied.

        This in itself might not pre-empt competition.

        It is arguable that cash profit extraction could possibly be 
        maintained by a very slick operation competing with a LETSystem 
        not offering a LETSfund program.

        Sufficent of the funds extracted could be returned, like lottery 
        winnings, to keep people willing to throw away their money. 

        But if a LETSfund program is available, offering cash capital 
        lending in unprecedented terms, its performance will diminish to 
        virtually nothing the profits available from the private 
        exploitation of the community resource.

        People will prefer not to give away their cash needlessly, 
        particularly when they are paying for the management of their own 
        money in the first place.

        Landsman Community Services Ltd.              REA-10    Page    3

        REA-10          Existing facilities.           January 8th,  1986

        This creates a very interesting situation.

        There is a definite debt of gratitude owing to those who have 
        pioneered the development of such personal money systems.

        It is only a pity that some of them did not some time ago realise 
        what they were in fact doing.

        Nonetheless, they represent a very considerable resource in 

        In addition to the management expertise, data processing and 
        general administration already in place, their client body might 
        provide an excellent nucleus of experienced traders around which 
        a full LETSystem could more quickly emerge.

        Any member of such a system who is in good standing and can make 
        it work, will find it much easier and more valuable to use a
        LETSystem, no matter what their business.

        To be sure, some existing systems, and some members, will be poor 
        starting material, but on the whole it is likely that some 
        mutually beneficial arrangements can be made.

        Landsman proposes that all LETSystems beginning operations in 
        communities where such commercial systems exist, should attempt 
        to interest the ownership in adopting LETSystem procedures and/or 
        becoming the service agency itself.

        As I understand the current situation, few people make very big 
        money out of such operations.

        If they ever show any great success, they are apt to generate 
        their own competition.

        The opportunity now exists for them to put their skills and 
        experience to work in a far larger operation, with a far greater 
        significance in the community than their current operations could 
        ever offer.

        Landsman Community Services Ltd.              REA-10    Page    4

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