2 min read
Where the risk sits
Buying stock in dollars or euros but selling in sterling means an unfavourable exchange-rate move increases your landed cost after you have set your price. On thin margins, a swing can wipe out the profit on a shipment.
Managing it
Forward contracts fix a rate for future purchases; building headroom into pricing absorbs small moves. A cash buffer and a flexible facility help you ride out a bad month. Sector-specific guidance is at Credicorp for Sectors.
What it means for you
Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online.
Frequently asked questions
What is currency risk for an importer?
The risk that exchange-rate moves raise your foreign-currency purchase costs after you have priced in pounds, squeezing margin.
How can a small importer hedge it?
Forward contracts lock a rate for future buys, and pricing headroom absorbs small swings. A cash buffer covers the residual risk.
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Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.