More and more companies, small and large, are venturing abroad, and for good reason; doing so gives a business access to untapped markets, diverse talent, and provides a hedge against the economic uncertainty that you are exposed to operating in only one country. As businesses continue going global however, they often find that the global payment system is dynamic and rapidly evolving. Failing to account for how overseas clients can or desire to pay for things can have a major impact on your success in foreign markets. Here are some great tips about international business payments that can help you add to your bottom line as you take your company global.
Manage Costly Fees
One of the barriers to successful international business is fees. If transaction fees – such as those involving the exchange in currency, or access to credit – are high, they can decrease or even eliminate your company’s profit margins. Businesses that are going global should consider partnering with a U.S. bank that can give you access to foreign markets and currency at competitive rates. Alternatively, another option for companies is to choose an overseas bank in the new markets you are pursuing, and manage major supplier/client transactions through them. Since your suppliers and customers in the new market will likely be familiar with a “local” bank, this can also provide them a level of comfort in dealing with a foreign company (yours).
Exploit Fintech Advantages
Another way to succeed with global payments is to take advantage of fintech—the rapid, ever evolving changes in financial technology that are revolutionizing the way we do business. There are several new tools that make it easier, safer, and more effective than ever to conduct global financial transactions. Due, for example, has an integrated global payment service that enables individuals or companies to securely conduct international business transactions. Due’s highly competitive transaction fees also allow small businesses to penetrate foreign markets, even if their margins are razor thin. Take advantage of these new tools. Allow customers to use mobile devices to execute transactions, can give you a leg up on your overseas competition.
While cryptocurrencies like Bitcoin are relatively new, and complex, they appear poised to be a permanent part of the financial landscape, and businesses should consider using them as a component of their global payment plans. Using blockchain technology for global business payments offers several advantages. First and foremost, it is yet another payment option you can offer your clients. Doing so increases the flexibility they have to pay for your products and services. Next, it largely eliminates the requirement for currency exchange. This is because a cryptocurrency like Bitcoin is universally recognized at a given price worldwide. Embedding terms and services within blockchain also can assist your business in cutting costs, and protect your profit margins.
Leverage Free Resources
There is an old African proverb: if you want to go fast, go alone; if you want to go far, go together. This is wise counsel when dealing with the challenges of foreign business payments. The U.S. government and other organizations want your foreign ventures to succeed. They offer a plethora of resources to help you an effective global payment system every step of the way; you never have to go it alone. The U.S. Export Import Bank, for example, is a great resource for businesses beginning to go global. It can provide you the expertise to secure foreign credit. It can even help you obtain insurance to protect you against uncertainties involved in global finance and payments.
Additionally, the U.S. Chamber of Commerce’s International Affairs Division can provide your company access to the expertise it requires to develop an effective global payments system. It’ll connect you with businesses that have already gone global, and help you venture into unfamiliar territory with confidence.