Growing a successful business can be a challenging and daunting labour of love. Managing cash-flow, controlling costs and keeping customers and suppliers happy – just some of the daily tasks faced by entrepreneurs. For businesses that work with overseas suppliers and international customers, there is the added factor of currency exchange to consider. Moving money across borders, quickly and at the best rate, should be a straightforward task for business owners.
Are you being upfront about your exchange rates? You need to ask yourself this question and look at
the answer from a customer’s point of view. Banks and other currency exchange providers are often quite coy about the exact margins they add to their exchange rates, and with good reason. When buying currency, you are offered a rate by your bank. Quite often this can differ from the “real”, pure exchange rate (typically what you see on Google) by as much as 5%. This exchange rate margin that you take is money out of pocket for your customers.
Yes, you need to make money if you’re in the currency exchange business and customers understand that. What customers don’t understand, most often, is how much is your margin and is it realistic. You might want to ask yourself whether you want to be always chasing new customers because you can’t maintain ‘loyalty’ from a lower and upfront margin, or do you want to create a solid customer base through building trust with recurring customers.
Businesses need to understand how their exchange rates are calculated, and how much margin is built into the rates. Often a service will claim to be “commission free”, while charging heavy mark- ups on their rates. Claiming to be commission-free is not exactly honest business if your commission is added to the exchange rate, sometimes at a large percentage.
Is your currency exchange business customer friendly? By offering services such as taking orders for trades at a rate that may appear in the future you can win over customers who could become your customers for life. Your customers also want their money transferred when you say it will be. Keeping on top of your exchanges and transfers is key to customer retention.
Using VinIT software will help you with all of your customer relations. We build software that is user- friendly and customizable so that you can set up your business to attract and maintain a sold customer base.