Back in early September, one of the businesses I work with was building a business plan which included purchases from China. We were quoted in Euros, and were aiming to sell the finished product in another international currency. The numbers were relatively small, but the impact of currency swings on the plans were high, although we felt they were fairly unlikely. Wind forward six months and those currency swings are in full flow - if we had gone ahead we could have seen a major impact. We would probably have gone ahead without a treasury operation, after all we were an SME and buying forward is for bigger companies, isn't it?
Just another example of the risks that face SME's venturing into international waters. Currency changes can be an opportunity as well as a risk, but either way, business owners need to be aware of the capacity of the markets to make life more difficult.
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