Company growth can be defined in several ways. Most obviously, it refers to increasing revenues as a result of being in business, but it can also mean growing in terms of the number of people it employs, how many clients or customers it has or the number of offices or outlets it operates domestically and internationally. Growth however can bring its own problems and risks – most notably the need for added resources to sustain it and the added costs that come with doing more business, particularly internationally.
More clients or customers means more support staff to service their needs. More offices or outlets means greater overheads from rent to services and again, more staff. And increasing your geographical spread brings with it the costs of doing business abroad, from transfer fees to the risks associated with fluctuating exchange rates.
Tapping into overseas markets is a necessary step for any business looking to exploit their market to the full. Approached pragmatically and with a sound business plan and the right
support, it’s not as daunting as it may first seem. Easy to overlook but important to help maximise profits and minimise costs, implementing a robust currency strategy is a crucial first
Many businesses leave it to their banks to take care of – it’s just one less thing to do themselves. But even after you’ve set up a foreign bank account, even after your overseas satellites are self-sustaining, there will inevitably be a need to repatriate revenues to the pound or another currency for, say, tax reasons or to invest in a new market. But leaving your foreign exchange up to your various international banks is a costly mistake to make.
Relying on banks leaves you exposed to a raft of hidden costs – especially when transferring from one foreign currency to another where unfamiliar systems and levies are commonplace. Some banks even take a fee from both the sending and receiving accounts, effectively charging you twice if you’re transferring between your own accounts. Alongside inflated exchange rates, costs can run to 5-6% of each transaction – serious money.
The solution is to engage the services of a dedicated currency transfer and treasury specialist, such as EFM partner Clear Treasury. A treasury risk management and foreign exchange consulting specialist, they help create stability and reduce risk exposure for businesses operating in fluctuating financial markets.
If you’re moving into international markets for the first time or are already operating overseas, Clear Treasury can help you understand and use the right hedging products to manage your financial risk with expert foreign exchange execution and advisory services. Through their consultancy service they provide strategic and operational analysis on how to manage your financial risk and make the most of every cent, dollar or dirham your business earns overseas.