Supporting a Digital Agency to Save On Currency Exchange
We Helped Save a Client Tens of Thousands in Lost Revenue by Adopting a Currency Strategy They Didn’t Know About.
Who was the client?
A large creative digital agency.
What was the challenge?
This client had growth aspirations and a large European client-base, but exchange rates and transfer fees were destabilising their business’ finances. They approached us for support after losing a substantial amount of money processing international payments.
Even though they’d previously been a client of a large, well-known accountancy firm, it became apparent that they’d never been given guidance on hedging when dealing with overseas clients.
How did we help?
Based on our experience working with international businesses, we knew exactly how to improve processes and get this client’s expansion plans back on track.
Hedging is a freeze on currency rates – agreed prior to the payment date – which ensures that fluctuating exchange rates don’t reduce an invoice’s value in the time between it being issued and paid.
We spoke to several traders, who agreed to lock in the exchange rates for a small fee. We also set up an exchange to EUR/USD instead of GBP, since the relevant rates and transfer costs were kinder to the agency’s bottom line.
What was the result?
We brought real-world, first-hand business experience to the table to remove the headaches of going global for this client. We secured 80% of their overseas business against wild currency fluctuations and made it easier to plan cash flow and investments. What’s more, moving to a EUR/USD exchange saved the client £20,000 in the following year alone.
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