Brexit. On Monday, July 11th FloraHolland did not have any particulars to report. "Business as usual," said Lucas Fox (CEO Royal FloraHolland). At the same time there is a lot of uncertainty. Companies are asking: What does Brexit mean for our exports in the longer term? How are currency rates developing? Can we respond to this and, if so, how? "No one really knows," says René Schilder of 2FX Treasury. "But the entrepreneur doesn’t necessarily have to wait passively."Kees Lakerveld and René Schilder
René: "Many export businesses bill in euros. Although the price of the pound has decreased between 10-15% since Brexit the exporter doesn’t necessarily have to notice anything as long as the customer simply continues to pay in euros. Still, it may just be that this customer is struggling. The cost for him has become considerably higher in the UK. He’ll have to pay more pounds for the same order than before Brexit. Ultimately, these costs will generally be charged through to consumers, which may lead to a decline in demand. So sooner or later as an exporter you will be affected."
Keep conversation going
René Schilder and Kees Lakerveld, owners of 2FX Treasury and at home in the world of international payments, can assist business owners in this. "A first step is to contact your customers: what are the implications for their business after Brexit. If you are aware of each other's situation, you can talk about possible alternatives. Perhaps agreements can be made for the coming months. The entrepreneur may also propose to charge in pounds for a while. This does mean that the entrepreneur has to self-manage the currency risk. Our motto is: keep the conversation going, this often goes a long way. Uncertainty will remain high in the coming period. So don’t expect an automatic return to the old situation."
Search for solutions
"In relation to Brexit, but also in relation to the opening of the Iranian market, we often hear that entrepreneurs have difficulty finding the right solution," says René. "However, there are certainly alternatives. We look at how a company is set up, at its objectives and map their financial flows. If we have a clear picture of the problems, we will work out alternatives and propose them to the entrepreneur. What they subsequently do or don’t do is, of course, up to the entrepreneur."
"Ultimately, our goal is to give the entrepreneurs more insight into his risks and what alternatives he has. This may vary from the use of alternative providers to hedging advice to get a grip on currency risks. We are independent and have no interest in a specific bank or provider. The starting point is always: what is the best thing for the customer. If the relationship with the house bank is good and they have a good product, we will certainly include this in our opinion."
"There are also interesting developments in the field of payment systems (FinTech) with which we can help. Because of the cloud technology there are, for example, affordable multi-banking solutions. These systems can connect multiple banks to their own ERP systems, improving the payment process. The biggest benefit can often be gained in incoming payments. By optimally loading data in the accounting systems, invoices can be drafted more efficiently. This often saves time and provides faster and more insight," says René Schilder.
For more information:2FX Treasury
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T: +31 651 222 543
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