There’s no doubt about it, there are numerous advantages that come with international trading. However, delving into a world of doing business across borders does add another dimension of complexity to business operations.
The advantages and disadvantages of international business
Expanding a business to include new territories can have significant plus points.
- It increases your customer base
- Extended brand reach
- The potential for increased revenue
- Possibly less competition in some countries
- The spread of seasonal sales
- A lower chance of marketplace saturation
But all of these things come with other considerations. That’s not to say this extra level of complexity is something to avoid. Far from it in fact!
There are just some elements that may require a little more handling than they would if operations were kept closer to home.
One of the most prominent hurdles confronted by businesses which trade cross-border is currency conversion. The timing of deals going through can effect the currency conversion rate, which fluctuates daily. It might even slow things down having to constantly recalculate everything manually.
Well, we do love to find ways to make things as simple as possible, so we’ve put together a few pearls of wisdom on managing multi-currency bookkeeping.
Mastering the art of multiple currency bookkeeping
Multi-currency bookkeeping can be rather time-consuming, and demands meticulousness. To make it simpler, you may want to find out if your bookkeeping software includes multi-currency processing.
Using an equipped bookkeeping software helps to avoid the time-consuming task of keeping up with current conversion rates. It also saves spending time on calculating a conversion for each international transaction, invoice or quote – manual processes which also risk human error.
Connecting multiple bank accounts which use different currencies is a weight off those shoulders. Simply select the base currency in Pandle, and we’ll do the rest for you.
Things to check before trading overseas
OK, so this isn’t an exhaustive list, but as well as making sure you have bookkeeping processes in place to handle multiple currencies, there may be other things worth checking.
For instance, do you need a licence to operate in that area? Do you need to register for local taxes? What specific information must you include on documentation?
There might also be cultural and social considerations; getting these right can sometimes have a huge impact on local success. Political factors might affect the stability of an area, too – so research is key to helping the long-term success in a particular area.
If you need more help getting started, then organisations such as the British Chambers of Commerce are usually a reliable place to start. To get started with multiple currency bookkeeping, set up a free Pandle account.
