Businesses requiring currency services will either use their banking partner or a specialist broker or a combination of both. Despite an abundance of choice available to them, where businesses (typically small and medium sized) do not have an employee with direct foreign exchange experience, they can become over reliant on the advice, products and the exchange rates offered to them by their banks and/or brokers.
Where an information or knowledge gap exists between a business and their foreign exchange provider, it can result in the business accepting exchange rates that are uncompetative and using complex hedging products that are not suitable. In both cases a business’ money can be wasted unnecessarily.
What we do
Wolsey Partners, with over ten years of industry experience, provides your business with the valuable advice needed to run your foreign exchange exposure in a self-serving and cost-efficient manner. As an independent consultancy (not a bank or broker) we are able to review your foreign exchange practices, identify common pitfalls and then advise on the strategic measures that can be taken in the best interests of your business
Why instructing WP works for your business
- Enhanced internal foreign exchange management can save 1-5% of your total transaction value
- The bottom line monetary value that we add will always significantly outweigh any fees that we charge and in most cases our service is Fee Free
- For larger businesses it is more economical than engaging a full-time employee to manage the foreign exchange aspect of your business
- You can maintain your existing financial channels
How we do it
1 – Assessment
Depending on the size and complexity of your business’s foreign exposure we will assess (remotely or present at your offices) all or a number of the following:
- The true costs of your past and existing currency contracts
- Capital priorities and the risk appetite of your business
- Your counterparty’s service delivery and charges – bank and/or broker
- Any existing Forward and Option contracts – maturities, value and appropriateness
- How you calculate your benchmark exchange rates and measure performance
2 – Report
We will compose a report from our assessment identifying:
- What improvements can be made and where
- The short, medium and long term monetary value that implementing those improvements will bring
N.B. The assessment and report are non-committal and made without charge
3 – Options
Depending on the outcome of our report we will propose one or more of the following choices:
(A) Negotiation and referral – Fee free
We match your business with a bank or broker that will be able to fulfill all your currency requirements and deliver improvements from our report. Wolsey Partners will negotiate all the terms of the relationship including, exchange rates (fixed), credit lines and contract flexibility.
Overview: Our referral is intended to save your business money and improve the efficiency and effectiveness in which your foreign exchange requirements are handled.
(B) Currency plan and implementation – One off fee
We produce and implement a currency plan within your business that is designed to meet the expectations from the initial report. This will include negotiating with your existing currency provider(s), introducing good practice measures and where appropriate providing training to your employees.
Overview: the plan we implement is designed to materially improve your bottom line and be understandable and workable from within the business. The one off fee that we charge is a function of the complexity and size of your foreign exchange exposure and the monetary value that we add.
(C) Currency management – ongoing – Consultancy retainer (2 months min.)
Firstly we produce and implement a currency plan within your business that is designed to meet the expectations from the initial report. This will include negotiating with your existing currency provider(s), improving internal structures and introducing good practice measures. We then manage the foreign exchange aspects of your business that most meet your needs on an ongoing basis, which can include:
- The ongoing assessment of your foreign exchange strategy
- We continually make sure you are not paying out money where you do not need to
- The management of maturing contracts
- Ongoing rate negotiation with your FX provider(s) and execution of new contracts
- Performance reports against benchmark rates
- Proactive currency market analysis
Overview: our currency management service should make significant improvements to the effectiveness in which your business’s foreign exchange exposure is handled both monetarily and in terms of efficiency. The retainer that we apply is determined by the amount of time required to manage the agreed aspects of the exposure on a month by month basis.