The Vital Connection: Paying Suppliers and Global Commerce

Posted on the 12th October 2023 by Hamish Anderson in Founders' blog, SME blog, Business, Finance, Founder Insights

Paying Suppliers and Global Commerce

UK businesses today are, by default, global. Regardless of sector, they operate in a fully interconnected world, compete with international companies, and must reach across borders to find customers, partners, and suppliers.  

This connected network can allow companies to develop and expand quickly and efficiently, to service previously inaccessible markets or to employ the best people regardless of location. 

In order for all of this to function though, money must always be able to move across borders smoothly, reliably and at low cost.

Beyond Borders

The 21st century has witnessed a significant shift in the way businesses operate. The internet, technological advancements, and improved transport links have made it easier than ever for companies to expand their reach and tap into international markets. As a result, businesses are increasingly looking beyond their home markets to grow and thrive.

This offers benefits, such as:

Market Diversity: Venturing into new markets diversifies risk, shielding businesses from the impact of downturns or changes in consumer behavior in a single market.

Revenue Amplification: Access to new customer geographies opens the door to additional revenue streams, offering new opportunities for growth.

Innovation and Adaptation: Operating in diverse markets compels businesses to innovate and adapt, ultimately enhancing their products and services.

Competitive Edge: A global presence provides a competitive advantage, attracting partnerships and opportunities for sustained growth.

Interconnected Dynamics

The interconnected dynamics of paying suppliers efficiently and expanding beyond domestic borders are at the heart of global commerce. Businesses that master these intricacies are better poised to thrive on the global stage. 

But, remember that the ability to pay suppliers with ease isn't just a transaction; it's a strategic maneuver that can define your success in the global marketplace.

Here are our top 10 tips to help you identify the optimal payment solution:

1. Understand Your Supplier's Needs:

Start by understanding your supplier's preferences and needs. Some suppliers may have specific payment methods they prefer or require due to their location or financial infrastructure.

2. Assess Currency Considerations:

What are the currencies involved in your transactions? If you regularly deal with multiple currencies, consider a solution that provides competitive exchange rates and minimizes currency conversion costs across your required currencies. Be aware that some providers vary exchange rate spreads according to the currency (charging more for ‘minor’ currencies).

3. Consider Payment Speed: 

Evaluate how quickly your suppliers need to receive payments. Some businesses require immediate payment, while others can accept longer settlement times. Choose a solution that aligns with your supplier's expectations.

4. Cost Efficiency:  

Compare the costs associated with different payment methods, including transaction fees, exchange rate margins, and any hidden charges. Look for a solution that offers competitive pricing.

5. Security and Fraud Prevention:  

Prioritize security when transferring funds internationally. Ensure the solution you choose has robust encryption and authentication measures to protect against fraud. Can a payment be recalled if necessary?

6. Payment Tracking and Transparency:

Opt for a solution that provides real-time tracking and visibility into your payment's progress. Transparency is essential for monitoring payment status and resolving any issues promptly. The best services will provide confirmation that funds have credited to a recipient’s account. Some will even provide free MT103s which are valuable proofs of payment allowing suppliers to release goods for transportation.

7. Compliance and Regulations:

International regulations and compliance requirements for cross-border payments are becoming ever more stringent, and payment services may have restrictions on the nature and location of recipients. Choosing a solution that is experienced in your sector helps you navigate these regulations smoothly, reducing the risk of delays or legal issues.

8. Customer Support and Service Level:  

Evaluate the level of customer support provided by the payment solution provider. Prompt and knowledgeable support can be invaluable when dealing with international payments. Sometimes you actually need to speak to an expert rather than relying Chatbot AI!

9. User-Friendliness:

Choose a solution that is user-friendly for both you and your suppliers. Complex payment processes can lead to errors and delays.

10. Reputation and Reviews:

Research the reputation and customer reviews of the payment solution provider. Feedback from other businesses can provide valuable insights into the reliability and performance of the solution.

By carefully considering these pointers and conducting thorough research, you can find the best solution to pay your suppliers overseas, ensuring the smooth and efficient operation of your international business relationships.

Get in touch with us if you’d like to know more about how Money Mover can help you transform the way you or your clients do business across borders. 

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