Calling Exporters and Importers - Need A Hand Managing Your Foreign Exchange Risk?
Operating in offshore markets can offer growth and expansion opportunities. But you should also be mindful of the impact of potential currency fluctuations on your bottom line and cashflow.
BC4B provide practical knowledge and expertise to assist you in managing your foreign exchange (FX) risk.
Benefits to your business include more predictable cashflows, less volatility in profits and more time for you to “stick to your knitting”. We do this by partnering you through the following steps:
Step 1: Identify your firms FX exposure and quantify the risk elements
We will have a chat to get a clear picture of the amount of exposure that your business has to FX movements, how it impacts your cashflows and the amount of time you spend managing FX risk.
Step 2: Determine some FX exposure goals
We then determine what you are looking to achieve regarding the management of FX risk. This involves thinking about the following questions:
• Are you looking to eliminate all foreign exchange risk?
• Do you want to protect against downside risk only?
• Are there ways to minimize your foreign exchange exposures?
• When should your foreign exchange exposure be hedged?
Step 3: Develop a plan
Once you have answered the questions in steps 1 and 2, we will develop a foreign exchange plan and tactics to implement it. For example, it may be that you fully hedge all forecast FX transactions within three months, and hedge 75% of forecast cashflows between four and six months etc. What we determine will be based on what you’re a looking to achieve.
Step 4: Put the plan in action and evaluate the results.
Once the plan has been put in place, we will then evaluate your progress towards managing your risks. Examples of tweaks to the plan include altering the hedging percentages and putting more attention into the FX cashflow schedule.
We can also review any existing FX hedging plan you in place, provide training regarding FX transactions with banks and provide guidance on appropriate FX treasury systems that may be required as your firm grows.
BC4B are proven independent and expert banking consultants providing practical support and advocacy to New Zealand companies in their dealings with Banks. We have branches in Wellington, Auckland and Christchurch supporting New Zealand business nationwide.
To find out more:
Phone: Phil Small on 027 914 243