{"id":3991,"date":"2014-02-20T16:24:52","date_gmt":"2014-02-20T16:24:52","guid":{"rendered":"http:\/\/www.mycurrencytransfer.com\/blog\/?p=3991"},"modified":"2014-03-06T18:04:03","modified_gmt":"2014-03-06T18:04:03","slug":"how-do-exchange-rates-affect-small-businesses","status":"publish","type":"post","link":"https:\/\/www.mycurrencytransfer.com\/blog\/how-do-exchange-rates-affect-small-businesses\/","title":{"rendered":"How do exchange rates affect small businesses?"},"content":{"rendered":"<p>Unfortunately, exchange rates are sometimes a little hard to nail and get just right. Luckily, there are are a few rules you can follow to make sure that you are clued up on exchange rates and how they can affect your small business.<\/p>\n<div class=\"wistia_embed\" id=\"wistia_8x44ripnpn\" style=\"width: 640px; height: 388px;\">\n<div itemprop=\"video\" itemscope=\"\" itemtype=\"http:\/\/schema.org\/VideoObject\"><meta itemprop=\"name\" content=\"How Do Exchange Rates Affect Small Businesses - MyCurrencyTransfer TV\" \/><meta itemprop=\"duration\" content=\"PT5M24S\" \/><meta itemprop=\"thumbnailUrl\" content=\"https:\/\/embed-ssl.wistia.com\/deliveries\/bebe822141d9273d2bb604fc0b44375b3982f139.bin\" \/><meta itemprop=\"contentURL\" content=\"https:\/\/embed-ssl.wistia.com\/deliveries\/6eae491e0691e24b0696bb7e4c6a4e6b33aaf01c.bin\" \/><meta itemprop=\"embedURL\" content=\"https:\/\/embed-ssl.wistia.com\/flash\/embed_player_v2.0.swf?2013-10-04&amp;autoPlay=false&amp;banner=false&amp;controlsVisibleOnLoad=true&amp;customColor=026eb2&amp;endVideoBehavior=default&amp;fullscreenDisabled=true&amp;hdUrl%5B2pass%5D=true&amp;hdUrl%5Bext%5D=flv&amp;hdUrl%5Bheight%5D=720&amp;hdUrl%5Bsize%5D=105604155&amp;hdUrl%5Btype%5D=hdflv&amp;hdUrl%5Burl%5D=https%3A%2F%2Fembed-ssl.wistia.com%2Fdeliveries%2F12fa914252d12966e42ce5e4336c34fd75d4b1fd.bin&amp;hdUrl%5Bwidth%5D=1280&amp;mediaDuration=324.0&amp;playButtonVisible=true&amp;showPlayButton=true&amp;showPlaybar=true&amp;showVolume=true&amp;stillUrl=http%3A%2F%2Fembed.wistia.com%2Fdeliveries%2Fbebe822141d9273d2bb604fc0b44375b3982f139.jpg%3Fimage_crop_resized%3D640x360&amp;unbufferedSeek=false&amp;videoUrl=https%3A%2F%2Fembed-ssl.wistia.com%2Fdeliveries%2F6eae491e0691e24b0696bb7e4c6a4e6b33aaf01c.bin\" \/><meta itemprop=\"uploadDate\" content=\"2014-02-19T00:48:08Z\" \/><object id=\"wistia_8x44ripnpn_seo\" style=\"display: block; height: 360px; position: relative; width: 640px;\" width=\"320\" height=\"240\" classid=\"clsid:d27cdb6e-ae6d-11cf-96b8-444553540000\" codebase=\"http:\/\/download.macromedia.com\/pub\/shockwave\/cabs\/flash\/swflash.cab#version=6,0,40,0\" bgcolor=\"#000000\"><param name=\"allowfullscreen\" value=\"true\" \/><param name=\"allowscriptaccess\" value=\"always\" \/><param name=\"wmode\" value=\"opaque\" \/><param name=\"flashvars\" value=\"autoPlay=false&amp;banner=false&amp;controlsVisibleOnLoad=true&amp;customColor=026eb2&amp;endVideoBehavior=default&amp;fullscreenDisabled=true&amp;hdUrl%5B2pass%5D=true&amp;hdUrl%5Bext%5D=flv&amp;hdUrl%5Bheight%5D=720&amp;hdUrl%5Bsize%5D=105604155&amp;hdUrl%5Btype%5D=hdflv&amp;hdUrl%5Burl%5D=https%3A%2F%2Fembed-ssl.wistia.com%2Fdeliveries%2F12fa914252d12966e42ce5e4336c34fd75d4b1fd.bin&amp;hdUrl%5Bwidth%5D=1280&amp;mediaDuration=324.0&amp;playButtonVisible=true&amp;showPlayButton=true&amp;showPlaybar=true&amp;showVolume=true&amp;stillUrl=http%3A%2F%2Fembed.wistia.com%2Fdeliveries%2Fbebe822141d9273d2bb604fc0b44375b3982f139.jpg%3Fimage_crop_resized%3D640x360&amp;unbufferedSeek=false&amp;videoUrl=https%3A%2F%2Fembed-ssl.wistia.com%2Fdeliveries%2F6eae491e0691e24b0696bb7e4c6a4e6b33aaf01c.bin\" \/><param name=\"src\" value=\"https:\/\/embed-ssl.wistia.com\/flash\/embed_player_v2.0.swf?2013-10-04\" \/><embed id=\"wistia_8x44ripnpn_seo\" style=\"display: block; height: 360px; position: relative; width: 640px;\" width=\"320\" height=\"240\" type=\"application\/x-shockwave-flash\" src=\"https:\/\/embed-ssl.wistia.com\/flash\/embed_player_v2.0.swf?2013-10-04\" allowfullscreen=\"true\" allowscriptaccess=\"always\" wmode=\"opaque\" flashvars=\"autoPlay=false&amp;banner=false&amp;controlsVisibleOnLoad=true&amp;customColor=026eb2&amp;endVideoBehavior=default&amp;fullscreenDisabled=true&amp;hdUrl%5B2pass%5D=true&amp;hdUrl%5Bext%5D=flv&amp;hdUrl%5Bheight%5D=720&amp;hdUrl%5Bsize%5D=105604155&amp;hdUrl%5Btype%5D=hdflv&amp;hdUrl%5Burl%5D=https%3A%2F%2Fembed-ssl.wistia.com%2Fdeliveries%2F12fa914252d12966e42ce5e4336c34fd75d4b1fd.bin&amp;hdUrl%5Bwidth%5D=1280&amp;mediaDuration=324.0&amp;playButtonVisible=true&amp;showPlayButton=true&amp;showPlaybar=true&amp;showVolume=true&amp;stillUrl=http%3A%2F%2Fembed.wistia.com%2Fdeliveries%2Fbebe822141d9273d2bb604fc0b44375b3982f139.jpg%3Fimage_crop_resized%3D640x360&amp;unbufferedSeek=false&amp;videoUrl=https%3A%2F%2Fembed-ssl.wistia.com%2Fdeliveries%2F6eae491e0691e24b0696bb7e4c6a4e6b33aaf01c.bin\" bgcolor=\"#000000\" \/><\/object><br \/>\n<noscript itemprop=\"description\">Make sure you know how to nail the top exchange rates and are clued up on how they can affect your small business. Check out these top tips to get you started.<\/p>\n<p><\/noscript><\/div>\n<\/div>\n<p><script charset=\"ISO-8859-1\" type=\"text\/javascript\" src=\"\/\/fast.wistia.com\/assets\/external\/E-v1.js\"><\/script><br \/>\n<script type=\"text\/javascript\">\/\/ <![CDATA[\nwistiaEmbed = Wistia.embed(\"8x44ripnpn\");\n\/\/ ]]><\/script><br \/>\n<script charset=\"ISO-8859-1\" type=\"text\/javascript\" src=\"\/\/fast.wistia.com\/embed\/medias\/8x44ripnpn\/metadata.js\"><\/script><br \/>\nGood morning and welcome to today\u2019s edition of MyCurrencyTransferTV. In today\u2019s episode, we\u2019re going to discuss how currency exchange affects businesses that trade internationally. It\u2019s a very fitting week to cover this subject, as last week, we\u2019re delighted to announce the launch of our sister product, CurrencyTransfer.com \u2013 built specifically for business international payments. The online marketplace matches businesses with multiple international payment quotes, with instant execution in one live transparent marketplace. Feel free to register for early access over at <a href=\"http:\/\/www.currencytransfer.com\/\" target=\"_blank\">CurrencyTransfer.com<\/a><\/p>\n<p>&nbsp;<\/p>\n<p>Let\u2019s discuss how exchange rates can affect a small business that makes cross-border payments, and what you can do to score the best deal on your business foreign exchange.<br \/>\n<img loading=\"lazy\" class=\"alignnone size-full wp-image-3740\" alt=\"rates-affect-small-businesses\" src=\"http:\/\/www.mycurrencytransfer.com\/blog\/wp-content\/uploads\/2014\/02\/rates-affect-small-businesses.png\" width=\"640\" height=\"496\" \/><br \/>\n<strong>Exchange rates can move over 1% in a matter of hours<\/strong><\/p>\n<p>Exchange rates can swing rapidly in a matter of hours, affecting the cost of business cross-border transfers. The FX market never sleeps, trading 24\/7. This can make an enormous difference to the amount of money you could save or potentially lose out on. Volatility in the exchange rates are had to predict and mean businesses more than ever need to have a carefully devised currency strategy.<\/p>\n<p><strong>Consider hedging your currency risk<\/strong><\/p>\n<p>Non-bank foreign exchange specialists will be able to offer you currency contracts that can mitigate against the risk of adverse currency fluctuations. A <a title=\"What is a forward contract?\" href=\"http:\/\/www.mycurrencytransfer.com\/blog\/2013\/09\/what-is-a-forward-contract-3370\" target=\"_blank\">forward contract<\/a>, only requiring a 10% deposit, lets you fix today\u2019s exchange rate for up to 12 months in advance. If you know you have to paying overseas suppliers at fixed dates in the future, forward contract can play a great role in building a currency strategy aimed at locking in favourable exchange rates. Likewise, consider a combination of limit orders and stop losses. Currency specialists are able to watch the market on your behalf and automatically fill a transaction when your target rate or worst-case scenario hits.<\/p>\n<p>Typically, these currency contracts aren\u2019t available within your normal online banking interface. As such, businesses can absolutely benefit from trading with a non-bank FCA authorised currency specialist.<\/p>\n<p><strong>FCA authorised currency specialists<\/strong><\/p>\n<p>Transacting with a high street bank can cost you up to \u00a35000 on every \u00a3100,000 you transfer. Banks set their rates typically only once a day, and factor in a pretty wide spread to encompass market risk.<\/p>\n<p>On the other hand, non-bank foreign exchange specialists call in to the live market, ensuring you get wholesale exchange rates that are pretty close to the real rate of the day. If you are a business trading sizeable amounts, aim to get quoted inside of 0.5% as a markup away from the mid-market exchange rate.<\/p>\n<p><strong>Know the exact cost to your bottom line<\/strong><\/p>\n<p>If you go to a supermarket, there\u2019s an explicit price for a bar of chocolate, sweets or popcorn. You know what it costs your pocket the moment you look at the exact price listed on the shelf. Likewise, it\u2019s important businesses know the exact bottom line cost on each and every cross border payment.<\/p>\n<p>Sadly, foreign exchange is one of the last areas of financial services where most don\u2019t know what they end up paying. Implied costs built into the exchange rate are not easily identifiable. As a top tip: calculate the difference between the \u2018real\u2019 rate, also known as the mid-market rate, and the exchange rate you are offered. Preferably, do this before booking an exchange rate with your supplier. Doing this simple but oh so important exercise, will let you identify the true cost to your bottom line.<\/p>\n<p><em>Quite simply: The wider the difference, the worse the deal. The closer the difference, the better the deal.<\/em><\/p>\n<p><strong>Shop around<\/strong><\/p>\n<p>Try not to settle for the first deal you stumble across when booking an exchange rate with your non-bank foreign currency supplier. It pays to get at least two competitive quotes side by side, each time you transact. As mentioned in the intro, the launch of CurrencyTransfer.com lets you compare live rates from multiple foreign exchange providers, bidding to win your business. You can also book live trades within the venue.<\/p>\n<p>We hope you enjoyed today\u2019s episode of MyCurrencyTransfer TV. If you have any follow up questions, feel free to tweet them in. Our twitter handle is <a href=\"https:\/\/twitter.com\/mycurrencytrans\">@mycurrencytrans<\/a> or you can email me direct: sofia@mycurrencytransfer.com<\/p>\n<p>See you next week!<\/p>\n<p>Daniel Abrahams on <a href=\"https:\/\/plus.google.com\/105158979413685359437\/posts\">Google+<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Unfortunately, exchange rates are sometimes a little hard to nail and get just right. Luckily, there are are a few rules you can follow to make sure that you are clued up on exchange rates and how they can affect your small business. Make sure you know how to nail the top exchange rates and are clued up on how [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":4040,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[115],"tags":[],"_links":{"self":[{"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/posts\/3991"}],"collection":[{"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/comments?post=3991"}],"version-history":[{"count":4,"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/posts\/3991\/revisions"}],"predecessor-version":[{"id":4086,"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/posts\/3991\/revisions\/4086"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/media\/4040"}],"wp:attachment":[{"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/media?parent=3991"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/categories?post=3991"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.mycurrencytransfer.com\/blog\/wp-json\/wp\/v2\/tags?post=3991"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}