For online sellers, they are so many things to think about that some things may get lost or not given the attention they deserve. If you’re using the marketplace to send your funds back to your home bank account, you could be losing money through poor exchange rates.
By using World First, you’d get a better exchange rate, so more of your money makes it home. Something to think about, eh?
Take a look at our online sellers’ currency guide
Martin Howie runs The Fragrance Counter, an internet retailer of fragrance and beauty products which exports goods to many countries around the world. He explains how he makes his currency transfers work for him, and how he saves money by using World First.
What currency products do you use, and can you explain how this works in practice?
“We use a mixture of simple spot purchases and forward contracts, which allow us to fix a rate and be protected when rates go against us. Through these, we have the flexibility to manage our currency transfers in our own way. The business is able to remain competitive if there are big movements on certain currencies, as we can book a spot contract, and take advantage there and then.
“Exchange rate markets have been incredibly volatile over the last 12 months in particular so it’s very important to have a plan in place to deal with this uncertainty. I feel confident that the currency aspect of our business is being dealt with in a cost effective way.”
Can you give an example of how you have saved money through your FX dealings?
“We receive an extremely competitive exchange rate from World First. Their systems are very easy to use and the customer service is excellent.
“The systems allow us to benefit from favourable exchange rate movements. We are able to transact using World First Online very quickly, with full information and without the need to contact anybody. Forward contracts are easy to put in place.”
What are the benefits of World First setting up bank accounts on your behalf?
“When entering a new foreign market, there are many aspects to consider such as delivery, prices and margins. It’s very helpful to know that international bank accounts can be set up securely and quickly with World First. They have ‘got it covered’ so I can concentrate on the other aspects of operating the business.”
Do the exchange rates affect your pricing model? If so, can you explain how?
“Some products in our business have a minimal profit margin. The reverse is also true that some lines will have a very high profit margin. It’s important to price items to ensure that exchange rate fluctuations do not take sales into losses or unacceptably low profit margins. Higher prices might also be set if the actual exchange rate is factored into profit calculations or some products might be priced more competitively if better exchange rates are available.”