Large, multi-national corporations typically have the benefit of entire teams dedicated to their global ventures, but small- to middle-market companies often require expert advisors to investigate, initiate and manage international affairs. Law firms with international and business practices can assist with navigating regulatory and risk concerns, as can financial institutions, which bring expertise in financing, managing currency exchange and tracking funds, among other vital services. Additionally, institutions may have access to wider networks of trusted partner banks in other countries, enabling a business to more easily and quickly complete transactions.
What Tools Can Help With Going Global?
- Foreign exchange markets: Currency values regularly fluctuate, which can make it difficult to complete transactions with overseas partners without help. Foreign exchange (FX) markets enable businesses to convert currencies safely and accurately. International banking professionals can assist businesses in accessing FX markets and mitigating currency risks. FNB’s team, for example, identifies and quantifies a business’ risk and develops a customized hedging strategy to avoid volatility in currency values.
- Trade financing options: Financing international trade and investment comes with unique challenges, ranging from geopolitical risks to regulatory bottlenecks. Working capital lenders who have experience with importers and exporters may be able to offset those risks by connecting businesses to a variety of domestic credit agency programs, originating multicurrency loans to guard against currency fluctuations and facilitating loans that establish subsidiaries in foreign markets.
- Treasury management: Digital tools make international business more convenient than in previous eras, creating efficient and transparent processes that simplify cash management. Modern banking technologies allow for live financial reporting, including payments tracking solutions that ensure sums that transfer between multiple banks make it to their end point securely. More treasury management solutions include multicurrency accounts to hold, send and receive several currencies at once and streamlined reporting platforms to assist with regulatory requirements.
The right blend of these tools, along with assistance from reliable advisors and the proper due diligence, has a large influence on whether a business can thrive in foreign markets — opening a world of opportunities.
Improving Supply Chain Management
Depending on the type of business, success is often tied to the strength of the global supply chain. How a company navigates the vast worldwide network of businesses and individuals that produces products, materials and components can foster positive outcomes for all connected parties.
That connection also increases risk exposure and the potential for disruption, as highlighted during the pandemic, geopolitical events and economic swings. To mitigate these risks and bolster supply chain management, businesses should consider these actions:
- Develop a formalized supply chain management plan, including steps for responding to disruptions.
- Stockpile backup inventory of internationally sourced supplies.
- Diversify suppliers and include domestically based companies.
- Invest in technology and automated processes to maintain and track inventory.
For more about supply chains and managing risk, check out this article on FNB’s Knowledge Center – Supply Chain Disruption | First National Bank.
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FNB’s International Banking team partners with clients to identify global payments solutions, financing and currency exchange options and to manage foreign accounts. Learn more at International Banking | First National Bank.
