Oriana Marcolongo is the ecommerce partner manager at Currencies Direct. Currencies Direct are Currencies Specialists and Oriana is very experienced at explaining the the technical side of this area via webinars etc to ordinary business people.

Why do we need to think about Currency as small business owners?

Cross-border trade is the norm now, so small business owners do need to think about currency. If you look at the business cycle, there are three key stages where it has an impact.

The first stage is that it affects the price of buying stock from overseas which will determine the cost to the business. The second part is when you’re selling products. The foreign exchange rate will determine the margin you get from your sales. Thirdly is when you need to convert those profits back into your home currency.

Small businesses are particularly vulnerable to tight margins and can mitigate the FX risk by using a currency specialist like Currencies Direct

At what point should a company start looking at FX when considering to trade overseas?

Oriana sees this as two key areas where a company should look at this.

One is at the strategic level. Business need to decide which markets they want to sell into, and currency’s a factor. So if a market is weak, they might pause selling into that market for a while or decide to look at other markets that will be more lucrative for them.

The other is at a tactical level. Companies need to consider currency from the planning stage. If they’re trading and source stock again, the FX cost will drive the cost of the products, and directly affect the profitability. If they are selling solely in foreign currency, then the cost of converting the sales could be a concern as well as the change in revenues due to the moving exchange rates.

Since Brexit, sellers in the UK have lost buying power in China since the GBP has lost quite a bit of value to the USD. Before Brexit, £1 would get about $1.48. Immediately after the vote, it would only get about $1.33. Recently,  every £1 we exchange gets us just $1.22. Now, when we go back to the supplier to re-stock, it going to cost us a lot more.

Can you give me any tips on reducing my foreign exchange fees in the global marketplace? I want to expand my business internationally, but we are worried about the cost of foreign exchange.

To give everyone a bit of silver-lining, when you sell in the US, you will be making more money back.

In terms of foreign exchange fees in global marketplaces, when you sell internationally, you need to bring your money back; there is a conversion cost. Using a Currencies Direct  collection account, you can cut your exchange fees in half. It works especially well if you’re selling into the Eurozone, US, or the UK. It’s free to setup and account and you can be up and running in 48 hours.

Currencies Direct will assist you in getting the profits you earn in foreign market, back into your home currency. So if you’re selling in the US, they will help you get it back into GBP.

Is it possible for me to pay suppliers through Currencies Direct? If I’m selling in the US, and I want bring the dollars back to the UK as dollars,