Established over 40 years ago, Kenneth Hodgins Interiors is a family-owned furniture retail business based in Sandyford, Co. Dublin. The company retails a carefully selected range of leading furniture brands, such as Cattelan Italia, Collins & Hayes, Fama, Stressless, Skovby, Tempur, Harrison, King Koil and Odearest.
The Challenge
Kenneth Hodgins Interiors sources and buys its furniture from several high-end suppliers in the UK. Paying in pounds sterling comes with challenges.
For Accounts Manager Jo Reilly, memories of Brexit-driven swings in the pound remain sharp, and even modest volatility between order and delivery can materially change costs and margins for the business.
The company recognised early that sterling exposure had to be hedged if they were to protect margins on long lead-time orders. Jo Reilly commented “There is a lead time of 12 to 14 weeks on most orders, so we cannot afford surprises in the final cost. By the time carriage and other charges are added, even a small move in sterling can make a real difference. We need certainty that the sterling we lock in will cover everything when the invoice falls due”
“However, one payments provider made currency hedging more complex than it needed to be. Booking forward contracts involved heavy paperwork and repeated follow ups. The process was slow, intrusive, and more expensive than expected. What should have been a risk management tool would become an operational burden”.
The Solution
The company contacted Fexco International Payments to discuss managing its currency risk in a more cost-effective and seamless manner.
Kenneth Hodgins Interiors was assigned a dedicated account manager who analysed the company’s sterling payments. Having talked through the advantages and disadvantages of the various hedging options available, the company decided that a “window” or “open” forward would be the most appropriate strategy. This allowed Kenneth Hodgins Interiors to agree a euro-sterling exchange rate up front. The company could then draw down an agreed amount of sterling at any time within a defined start/end date at the pre-agreed exchange rate, giving flexibility alongside rate protection.
“The open forward option suited us perfectly. We could lock in the rate but still use the sterling as costs landed, which took a lot of pressure out of managing payments week to week”, added Jo. “The forward contract execution process with Fexco International Payments was very simple”.
“Unlike with the other provider we were using, no personal guarantees were required. Our account manager guided us through the entire process. Everything is settled same day, and our suppliers receive the correct amount each time.”
The Benefits
Kenneth Hodgins Interiors now knows, with confidence, what it will be paying its UK suppliers two to three months ahead of settlement. That certainty has transformed cashflow planning and removed guesswork from pricing decisions.
Sterling risk is actively managed, and the Accounts Manager no longer worries about whether exchange rate swings will inflate costs between order and delivery. Forward contracts ensure that payments will cover supplier invoices, carriage, and associated costs when they fall due.
For Jo Reilly the benefits are clear: “The team at Fexco International payments is so proactive and nothing is beyond them when it comes to resolving payment issues. Managing currency risk no longer distracts from day-to-day operations. What could have been a complex and time-consuming process is now straightforward, fast, and cost-effective. For a retailer operating on tight margins, that clarity and control makes a measurable difference.”
How Fexco Can Help Your Business
Killorglin-based Fexco International Payments provides a seamless and cost-effective foreign currency payment solution for businesses seeking to optimise their cross-border transactions. Through its innovative payments platform and extensive global banking network, Fexco offers:
– Access to over 165 currencies and payments to nearly 200 countries
– Competitive exchange rates and reduced FX costs compared to traditional banks
– Fast, secure, and transparent transactions that protect business margins
As a first step, SMEs should request dual-currency invoices from their international suppliers and compare rates. Once this information is available, Fexco can help businesses determine the most cost-effective payment option and ensure they make savings on FX transactions.
For further information please contact Ian Craddock, Business Development Manager, Fexco International Payments, Mobile: 087 9094392, email icraddock@fexco.com
www.fexco.com/payments-and-fx/international-payments/
IAN CRADDOCK
Business Development Manager, Fexco International Payments
