price set in Euro or Sterling?

usainbolt

Hi,

I just received an initial price per unit from a new UK supplier, he has set the price in Euros.

Should I insist that the price is set in Sterling as the euro is pretty weak versus sterling at the moment.

Compton

you could try. suppliers often do this, for example a company wants dollars when they are strong so you agree, and when the dollar is weak suddenly they want euro!

srsly78

Demand price in sterling. And then use an fx broker to convert your euros to pay them. Do NOT use the bank for fx as it will end up 5% more expensive due to lousy rate. If you gonna be trading in sterling a lot definitely open an account with a broker. I use www.rabbitfx.com, no problems opening account using my irish address etc.

usainbolt

srsly78 wrote: »

Demand price in sterling. And then use an fx broker to convert your euros to pay them. Do NOT use the bank for fx as it will end up 5% more expensive due to lousy rate. If you gonna be trading in sterling a lot definitely open an account with a broker. I use www.rabbitfx.com, no problems opening account using my irish address etc.

Thanks srsly78, they have agreed to set prices in sterling. I will look into your suggestion of using a broker such as rabbitfx.com

ssbob

This is woeful advice, where possible you should always deal in Euro's if your sales are Euro's which I assume they are as you are based here.

By demanding a sterling invoice you are bringing uneeded FX Exposure on yourself, what are you going to do if the Euro explodes into Hyperinflation and the Euro weakens dramatically, you will have to try fund a really expensive Sterling transaction.

As for the banks charging 5%, I am not too sure but the best way to do that is check the actual fx rate v what the banks would be giving you on your business bank account.

usainbolt

ssbob wrote: »

This is woeful advice, where possible you should always deal in Euro's if your sales are Euro's which I assume they are as you are based here.

By demanding a sterling invoice you are bringing uneeded FX Exposure on yourself, what are you going to do if the Euro explodes into Hyperinflation and the Euro weakens dramatically, you will have to try fund a really expensive Sterling transaction

As for the banks charging 5%, I am not too sure but the best way to do that is check the actual fx rate v what the banks would be giving you on your business bank account.

Thanks for the reply ssbob. You do have a valid point but looking at the historical exchange rate range between the Euro and Sterling I believe that the Euro will more than likely strengthen over the medium/long-term. That is only part of the story .....

The prices the supplier initially gave me in Euro's equated to an exchange rate of £0.67 to the Euro. This is why I demanded the RRP to be those set in £sterling for the UK.

ssbob

usainbolt wrote: »

Thanks for the reply ssbob. You do have a valid point but looking at the historical exchange rate range between the Euro and Sterling I believe that the Euro will more than likely strengthen over the medium/long-term. That is only part of the story .....

The prices the supplier initially gave me in Euro's equated to an exchange rate of £0.67 to the Euro. This is why I demanded the RRP to be those set in £sterling for the UK.

£.67 is ridiculous but when looking at fx (especially in the current climate), history accounts for nothing.

Can you ask you what you are buying?

usainbolt

Thanks SSBOB I agree.