Aubrey Peregrine-Smythe recently visited Paris to meet with the French suppliers for his London-based store, Gastronom—a purveyor of fine foods and delicacies for the discerning palette.
Aubrey and his accountant were looking to negotiate a 30-day credit terms for their monthly order, because they were planning to take advantage of their WUSMOnlineFX account to call a representative and place an exchange rate bid (or limit order)—a facility that allows customers to specify their ideal exchange rate and arrange for their payment to auto-fill if the market hits that rate within a 30-day period.
For their October 2012 order, Gastronom’s invoice came to €13,500 EUR. When Aubrey’s accountant called their bank, he was offered a rate of £1 GBP = €1.237 EUR for this payment—meaning they would have to send £10,913 GBP to ensure their supplier received €13,500 EUR.
The accountant then called the Online FX team, and arranged a limit order at an exchange rate of £1 GBP = €1.267 EUR. Seven days later, the market moved in their favor and their rate was met, triggering the limit order to auto-fill—meaning that the same order only cost £10,655 GBP—a savings of £258 GBP.
After conducting some market analysis, Aubrey’s accountant decided that this was an opportune time to book a forward contract, in case the rate moved against them in the future. He then called in to the Online FX team again and locked-in a Forward at a rate £1 GBP = €1.267 EUR—allowing them to take advantage of this great rate for a period of one year.
By locking-in a rate at £1 GBP = €1.267 EUR in October 2012 for transfers of the following months, Aubrey’s accountant knew their costs in advance and could budget accordingly. Each time a payment was required, he drew down the required euros from the forward contract, paying their French suppliers each month.
In addition, as a regular customer, Aubrey’s fees were waived with Online FX, saving him an extra £15 GBP a month.
Pleased with these incredible savings Aubrey decided to send all of Gastronom’s international payments through Online FX. Aubrey has invested the extra money back into the business and is now looking to establish a second location.
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*Comparison made on October 8, 2012 with a leading UK high street bank.
**Annual savings assumes a constant difference between providers’ rates.
^The above scenario provides an example of how a customer can use our services to efficiently meet their payment needs. The example given is not based on an actual Western Union client story, but is presented for illustrative purposes only.