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Now that marketplaces and marketing are largely digitalized, newly-started companies can target a global market from day one. The retail sector in particular has lots of examples of successful export stories.
Take Swedish fashion company Ivyrevel. Ivyrevel was founded in 2012 by Instagram queen and influencer Kenza Zouiten, together with Aleksandar Subosic, Dejan Subosic and Gustav Springfeldt. Nordea has been in close contact with Ivyrevel from the start. Recently I talked to two Ivyrevel managers to learn how Nordea helped the company streamline its currency management.
The first collection was launched in 2013, and the company quickly broke into markets around the world. How did this happen?
“We like to say we were born global,” says Ivyrevel co-founder Subosic. “When Ivyrevel launched we had customers across Europe, the US and Canada after only one week. We currently have customers in over 80 markets.”
Ivyrevel is marketed solely via digital media, where Zouiten’s social media channels have been and remain important elements, he explains.
“Ivyrevel is the world’s first digital fashion house, and that’s something that’s reflected throughout our business model,” Subosic says. “We design our products with a digital mindset and distribute them exclusively via the channels Ivyrevel.com, Asos and Zalando.
“We want to bridge the gap between fashion and technology to create the world’s largest and most progressive digital fashion brand.”
Cooperation with Google
Ivyrevel aims to develop fashion for the high-tech age, which has resulted in innovative projects together with companies such as Google. The Coded Couture app allows users to design their own unique garments.
“We’ve focused on haute couture, the most exclusive aspect of fashion, which comprises bespoke items, and we’re now also making our own digital version for our generation,” Subosic says. “Ivyrevel makes bespoke fashion available to everyone everywhere.”
Running a global company presents challenges whatever sector you’re in. What’s your experience of that?
“As well as needing to know about different laws, regulations and currency conversions, customers are very different in different markets,” Subosic says. “They’re interested in different products, and they have different behaviour patterns and different demands and expectations of products. Currency management is unavoidable in our business. Things move pretty fast at our company, and currency management was an area that unnecessarily occupied a lot of time previously. Our cooperation partner Nordea proposed more automated management using its AutoFX currency robot, and we’re really pleased with it.”
The major advantages of AutoFX
Senaid Hasic, Senior Business Controller at Ivyrevel, explains that the currency robot AutoFX powered by Nordea frees up resources and reduces manual processing. It makes currency management more reliable and cuts costs as the tool automatically monitors and tops up negative balances.
“Most of our costs are in Swedish kronor, while our income is in lots of different currencies, and we previously had to manually sell the foreign currency to buy Swedish kronor,” he says. “This process is now completely automated based on a set of rules we established together with Nordea. It saves us a lot of time. Since April 1, 2017 we haven’t spent a single minute on exchanging currencies. It also gives us a good average exchange rate as the exchange transactions take place on an ongoing basis.
“The idea of trying AutoFX came from Nordea after we discussed our currency risk with their experts,” he continues. On a number of occasions Nordea has provided us with proactive advice and helped us improve the efficiency of our day-to-day operations. They make us think and often come up with new ideas and suggestions.”
What’s the next stage of development for Ivyrevel?
Subosic says: “Our focus now is to continue innovating within digital fashion and on scaling up our presence on certain key markets.”
A clever pricing strategy
Ivyrevel has a clever pricing strategy. Getting paid in local currency makes it easier for customers to understand pricing and make purchase decisions. It’s not a good idea to create unnecessary barriers to sales, so it is advised that companies exchange sales revenues once they’ve been received. But this work was becoming very time-consuming, that is why the AutoFX solution is ideal.
As companies go global, the role of currency management becomes even more meaningful to the bottom line. That is why having an effective currency management strategy is vital. Here are four tips to create a more effective currency management strategy.
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