Since last summer’s Brexit referendum – when Sterling witnessed its largest single intraday drop against the dollar – the pound has experienced wild swings in value, both to the upside and downside.
Has your business been affected by this? Plenty of SMEs across the UK have experienced the resulting impact on the value of the international payments they are making or receiving – many with an adverse affect on their bottom line.
Yet amazingly, a recent survey revealed that 80% of SMEs either haven’t hedged their currency exposure at all since the Brexit vote, or haven’t amended their hedging policy in any way.
Elections tend to bring uncertainty to financial markets
One year on, this summer’s general election in the UK could well deliver further potential turbulence.
Recent opinion polls seem unanimous about the outcome of the vote. But how an expected Conservative Party win and increased majority in the House of Commons will affect the ongoing Brexit negotiations and the likely related value of Sterling is anyone’s guess.
Elections of any kind have a tendency to bring uncertainty, which can cause unexpected fluctuations in the currency markets. With the snap election in June, and many other global political developments continuing to contribute to potential currency volatility, now is not a time to be passive when it comes to managing your business’s foreign exchange (FX) exposure.
It’s time to take a proactive stance to protect your business
It is accepted wisdom that in the coming months, significant political events around Europe as well as in the UK are likely to have a noticeable impact on currency markets. Businesses that are making or receiving international payments need to take action now to protect their operations – and their profit margins – against the risk of currency volatility.
Uncertainty and ‘sharp movements’ in currency markets are now the new norm. So SMEs need to explore new ways of insulating themselves against, or mitigating the risks of, adverse currency fluctuations.
Businesses that make FX planning an integral part of their long-term strategy put themselves in a far stronger position compared with those SMEs that leave currency matters to the markets.
Take control of your international payment costs…
Whether your overseas trading environment is currently being affected by uncertainty over the future impact of Brexit, upcoming elections across Europe, geopolitical developments in Russia and North Korea, or seemingly ever-present concerns over the unpredictability of President Trump, you can help to protect your business against the risk of currency volatility.
Choose to take control of the costs of your international payments now, and you can create more certainty for your organisation during these turbulent times.
Being prepared for currency volatility and planning appropriately should be a priority for your business – it’s not something that you can afford to ignore.
One of the most common mistakes among businesses that trade internationally is simply not knowing how exchange rate fluctuations can affect their bottom line. This can make it difficult for SMEs to mitigate the risks of currency volatility, and they may end up making snap decisions in reaction to market movements, which could prove costly in the long term.
Request a free review of your currency risk exposure
At Godi, we offer all SMEs a complimentary FX review, to help you better understand the effects of exchange rate fluctuations on your specific business operations.
Our no-obligation review includes an assessment of your FX risk and cash flow, an audit of your current FX arrangements – including a price comparison versus your bank or current FX provider – and expert recommendations and strategies to help you to reduce your currency risk exposure.
How confident are you that currency fluctuations won’t adversely affect your business this year? Take advantage of our non-commitment FX review and audit today and receive…
- An assessment of your foreign exchange risk and cash flow
- A price comparison versus your bank or current Foreign Exchange provider
- Recommendations and strategies to help to reduce your currency exposure
Ask one of our friendly experts to help you review your business risk and explore your options – simply call 0203 326 9082 or email firstname.lastname@example.org.