I am often asked by journalists my opinion on the effect the fluctuating dollar, falling dollar, rising dollar and exchange rates have on exporters. I think that it all definitely has an effect, although in my experiences with exporters, there are a number of other less obvious traps that have an even bigger impact on their businesses.
The thing is, businesses normally understand changing interest rates and exchange rates or at least have a finance broker or advisor who understands it for them and they plan around it. The things businesses often have little understanding of are regulatory changes affecting employment, labelling laws in different countries, customs regulations, insurances and these are the biggest killers in terms of cashflow, not the global financial crisis.
Most global businesses are actually small local businesses that have had success in exporting. Should that local business fail to pay its employees the correct wage for example or are taken to the workplace ombudsman for an unfair dismissal claim – the costs incurred in back pay and fines may well spell the end of that local business and in turn the end of their export ventures.
So I would urge all exporters to worry about the dollar yes, but spend what dollars they have left on ensuring that they remain compliant with all of the regulatory regimes that affect their businesses.
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Lynda Slavinskis is an outgoing, intuitive and commercially savvy lawyer. She has worked in-house at Sussan Corporation and Tattersall’s and now assists small and medium businesses with import, export, leases, franchising, employment and general business advice as principal solicitor of Lynda Slavinskis Lawyers & Consultants. Lynda is on the Victorian State Government’s Small Business Advisory Council.
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