Alwyn-Jones said independents must cover the risks and offset their costs by going to banks and accountants early to seek advice on forward buying currency so they can keep a tight grip on costs and margins.
He said: “Retailers will know the total purchase of their autumn stock in euros. At the time of order, they need to forward buy currency so they can lock in costs, so they know what their margins are.”
He added: “It is a commercial risk, but retailers’ banks or accountants should be advising them on how to minimise this. Retailers are in retailing, not the foreign exchange market.”
Rebecca Furbank, co-owner of Anne Furbank in Buckden in Cambridgeshire, said it was essential for independents to monitor exchange rates. “We keep a close eye on the market because exchange rates can have a massive impact on the end retail price. It’s definitely worth forward buying currency. I wouldn’t say to anyone ‘this is the way to do it’, but it can make a significant difference.”
Sarah Murray, who runs Jane Davidson in Edinburgh, said she was considering forward buying currency to minimise the impact of the exchange rate.
“I now buy a lot in euros, and if I’d had more knowledge about forward buying currency I would have done it this season. Retail prices are in pounds, but suppliers are selling in euros, so we are losing a lot on exchange rates.”