Clients typically do not know their cost of Foreign Exchange or the margins they pay. With our Foreign Exchange market data we can determine your costs, back into price margins, and evaluate how competitive your FX costs have been. FX purchased over bank automated internet systems will have a time stamp to show when the FX was purchased. With the FX rate and times of trades we can determine if your average cost is .50% or 3%. e.g.: A Sample of a System Report including the Time Stamp is provided.
We evaluate how competitive your Foreign Exchange terms are on the volume and overall relationship.
Train & Teach.
Teaching and Training a management team how to improve their FX pricing for spot purchases over the internet, and for large, and forward FX transactions, is a part of our coaching process. This involves understanding management responsibilities and structure.
Broker FX Arrangements.
With our various Bank relationships we broker definitive Foreign Exchange terms so that the FX costs are known and reasonable in light of volume. Our knowledge of FX systems, bank office operations, and how prices are set enables us to diplomatically broker favorable terms. This often involves having backup FX sources, or alternatives to your primary provider of FX, to help maintain competitive pricing. In the Pricing Sample the Client's cost averaged 0.69%. After negotiations the price was reduced to 0.075%.
Establish Processes & Improvement.
After the evaluation, teaching and brokering stage, it is normal to codify procedures to maintain efficient and cost effective FX management. This involves determining ongoing management of processes and who has ultimate management oversight. The goal is setting processes and procedures to have continuous improvement in FX management, where there may have previously been indifference. While cost savings are a key incentive, it is important to note Foreign Exchange Hedging for risk control purposes is a key part of the Process.
Verify & Maintain Relationships.
Once established we can review historical pricing to monitor FX agreement compliance. This involves understanding bank operations, and variances to arranged pricing, which may be due to volatility, exotic currencies, or operational issues. Assessing the operational results and pricing provided leads to recommended action on relationship maintenance. Our follow up and maintenance program assures ongoing quality service and Foreign Exchange price integrity.