Increasing your profits is not easy when you are not capitalizing on all the resources at your disposal. This is especially the case for international businesses that depend on offshore markets to generate income. Relying on your local currency, in this case, is a big no-no, as this can make your company lose hundreds of potential clients.
This is why many business owners are looking into leveraging foreign exchange in international transactions. If you are still not sure that foreign exchange holds merit when it comes to growing your business, read on to know more about the advantages of utilizing it.
Make More Sales
Running a business is not challenging if you keep one fact at the forefront of your mind: more sales are conducive to more profits. Sticking to your local currency when conducting business with foreign customers is usually off-putting, given the extra fees they have to incur. You may also think that pricing one of your products at $30 is reasonable, not knowing that your customers will have to deal with fluctuating exchange rates and end up paying double that amount. According to recent statistics, one of the most decisive reasons for shopping cart abandonment is hidden costs. For most customers, these often have to do with the expenses of paying in a foreign currency. By incorporating foreign exchange into your dealings, your clients will feel more at ease when purchasing your products, as they are going to be sure that the sum they see is what they will actually pay.
If you deal with offshore suppliers, using your local currency to make payments can make you incur a lot of additional expenses. These costs accumulate in the long turn and may end up creating a huge budget deficit. When dealing with European suppliers, it is better to exchange the amount you are due to pay to euros to avoid the extra expenses that these suppliers might add for sending the invoices in dollars. This is especially crucial if you are not well-versed in exchange rates, which is expected considering that they are extremely volatile right now. So, definitely invest in foreign exchange if you want to save some pretty penny.
Take Advantage of Multi-Currency Accounts
When you start charging for services and receiving payments in foreign currency, you get to open a multi-currency account. These types of accounts come with a wide array of benefits, including free transfers. Not only will you avoid pesky exchange fees, but you will also be able to receive payments faster from your customers and access your account from any place in the world. Having a multi-currency account has become the norm for most international businesses, so it is time to leverage foreign exchange and enjoy all the perks that come with it.
Increase Brand Loyalty
As we’ve already mentioned, utilizing foreign exchange allows your business to attract more clients. However, it goes far beyond just that. In the long run, you will notice that your company has succeeded in creating a broad, loyal customer base.
This means that customers will not make only one-time purchases when choosing your business, but they are going to be in it for the long haul. After a while, your company will gain more momentum and inspire trust, which is what all business owners aspire to achieve.
Sure, issuing refunds is a headache, but you know what can make it worse? Using your local currency when issuing overseas refunds! As you are well aware, you will need to wait for your chosen financial institution to finalize the transaction, which can take days. Of course, most customers are not patient when the matter involves their hard-earned money. By investing in foreign exchange, your customer will receive their refunds much faster, and you will not have to deal with the extra expenses banks charge when processing payments that are in a different currency than the local one. Foreign exchange can also help you reduce chargebacks since your customers will be able to fully understand your pricing structure.
Even though some business owners are still reluctant to resort to foreign exchange, it remains the most guaranteed way of facilitating transactions. Regardless of the type of business you run, you need to leverage foreign exchange as long as you have international suppliers and serve an international customer base. You can always seek the expertise of an exchange consultant when in doubt. So, rest assured that you will get all the help you will need to unlock the potential of foreign exchange.