How to future-proof your business in a global economy, as told by the experts
As a tumultuous economy plays in the backdrop and the idea of “how quickly can I scale my business” increasingly front of mind, it’s vital business owners take proactive steps to ensure longevity and success.
At this year’s Business Chicks 9 to Thrive Summit, OFX’s very own Chief Financial Officer, Selena Verth, sat alongside a panel of inspiring women – Victoria Devine, Konara Gena and Emma Isaacs – to discuss future-proofing your business in a global economy. Here are the key takeaways.
Understand your customers and new markets
One thing that has stood the test of time is the relentless focus on the customer. Everything in your business should come back to this as Emma Isaacs comments, “a solid customer base can help you withstand changing conditions”. Take the time to listen to your customers – whether that be on the phone, or as Victoria Devine recommends through the various platforms the digital landscape has helped foster, “diversify the way you’re connecting with people, harness them as a community”. Speaking anecdotally, Emma also highlights the importance of understanding nuances of each market. “We went to America and at first glance, you think it’s very similar to Australia. However, what you soon find out is the cultural nuances and what it takes to run a business are vastly different. We even faced challenges with the brand – Business Chicks just simply didn’t translate in America. We had to learn on the go, and we did a tonne of discovery trips to really delve into the market”.
Be obsessed with your cash flow
Know your company’s cash position and financial performance.
For Selena Verth, this means daily check-ins to understand what’s changing in global markets that could influence exchange rates. What you’ll find when running an international business, is that not all economies are going to be performing strongly in unison. In fact, the opposite is usually the case; when one performs well, another may stumble. For example, influences such as the US-China Trade War puts pressure on the Australian dollar, whilst on the other side of the world Brexit plays havoc with the UK and European economies.
Being in tune with the financial health of your company is your safety vest – it’ll help you navigate ways to protect your portfolio and any revenue. Understanding this dictates your strategy.
Ensuring you are managing your risk, whether that be around your customer base or juggling multiple currencies, is also important. “We’ve all transferred money through our banks and seen how expensive that can be. For growing businesses, keeping as much of their hard-earned cash through competitive FX rates and working with a currency specialist to develop a currency plan can mean big savings.”
Understand the power of connections to help drive growth
It’s okay not to be an expert at everything. That’s the power of networks, resources, and if all else fails (or even if it doesn’t) you can simply “google it”.
OFX’s recently released OFX Cross-Border Confidence Index found Australian SMEs alone are forgoing $84bn in potential revenue. The reason? A lack of confidence in managing exchange rates are stopping them from trading internationally.
However, as Selena notes, with the right tools and support network, going global can be a growth driving reality for any business. “For local businesses looking to capitalise on international opportunities it’s about having the right partners in place to help – whether that’s with product sourcing, distribution, manufacturing or foreign exchange”.
And the benefits speak for themselves; according to the research, SMEs already trading internationally found an increase in revenue and customer base, and perhaps surprisingly, more competitive positioning in the local market.
Whilst there’s no fool-proof way to future-proof your business, it’s important to be courageous and disciplined enough to test, review, pivot and ask yourself, “this isn’t working, but what else could?”
And if in doubt, be fluent in your data so you can make better decisions and understand where the business has been and more importantly, where it’s going.
Enjoyed the read? Watch the full panel discussion on ‘How to Future-Proof your Business in a Global Economy’ here.
IMPORTANT: The contents of this blog do not constitute financial advice and are provided for general information purposes only without taking into account the investment objectives, financial situation and particular needs of any particular person. UKForex Limited (trading as “OFX”) and its affiliates make no recommendation as to the merits of any financial strategy or product referred to in the blog. OFX makes no warranty, express or implied, concerning the suitability, completeness, quality or exactness of the information and models provided in this blog.