the impact of currency swings
Most small businesses that trade internationally take currency swings as a fact of life. They go about trading with their suppliers and buyers in foreign markets and convert currencies whenever they process foreign payments or collections. If exchange rates move between the time when orders are placed, and invoices are paid, the resulting amounts in one’s home currency fluctuate, impacting profits and cashflows.
Having currency exposure means that your businesses' financial results are sensitive to foreign currency swings. As currencies go up or down, your balance sheet profit margins or cash flows evolve differently than if you were doing business in one currency.
These exposures can have positive and negative connotations - for instance, your profit margins can become higher or lower, depending on how the exchange rates change and affect your revenues or costs.
Having a plan is a must
The effects are relatively small most of the time, and businesses see no need to think about protecting their cashflows from currency effects. In fact, such concerns usually come as an afterthought - after a large surprise currency move that has wiped out one's profit margins or led to an expectedly low cash balance. Traditionally, this is a point where many businesses would typically decide to focus some of their attention on the problem - often too little, too late.
THE Good news: there are SOLUTIONs Accessible to all smes
Small businesses are more exposed to economic risks than larger corporations. Almost every large business proactively manages its international cashflows. Unfortunately, most smaller businesses are either unaware of how to solve this issue, don't have access to the right tools or find the whole topic complicated and expensive.
As a result, and according to a study by British Business Bank, only about 4% of SMEs currently manage their currency risks and are, therefore, less likely to find themselves in trouble when situations like the current one strike.
TURNING ALL YOUR INVOICES INto HOME CURRENCY

Oct 13, 2022 2:00:00 AM