A good relationship with your suppliers can help you in many ways. It’s about getting what you want, when you want it at a fair price. Inevitably, there are times when things need to be changed, possibly at short notice, or you need favours from your suppliers. If they regard you as a good customer the suppliers are more likely to meet all your requirements.
Here are five top tips on how you can use currency services to enhance your relationships with suppliers worldwide:
1 Negotiate better deals
When suppliers quote you in US Dollars the price usually includes a mark-up. That’s to cover their foreign exchange costs and volatility risks. If you offer to pay suppliers in their local currencies suppliers will usually offer you a lower price.
You may even be able to negotiate further discounts with up-front payments and by buying larger quantities at once. This doesn’t need to put pressure on your cash flow when you opt for a flexible trade finance facility.
2 Get better exchange rates
Trading internationally offers many opportunities to save money. Exchange rates are one of them.
If you leave foreign exchange to your suppliers, you may find yourself paying more because of higher exchange rates charged by the banks in their countries. If you take responsibility for currency exchange you can select a provider with highly competitive rates, which will save you money.
3 Build stronger relationships
Offering upfront payments in local currencies shows that you’re making an extra effort. Suppliers typically value this, which will strengthen your relationships with them.
4 Choose from the best suppliers available
Good, reliable suppliers can often pick their customers and you want to ensure that you get the supplier you really want to work with. If you meet or even exceed their expectations on the finance side, suppliers are likely to work hard to retain you as their customer.
5 Benefit from consistency
You shouldn’t have to go through the trouble of having to find new suppliers every time the currency markets have temporarily moved against you and make trading with the country in which your existing suppliers are based less attractive. If you plan ahead you’ll be able to protect yourself against volatility risk, with forward contracts for example. They allow you to lock in an exchange rate for a certain period of time.