Travel is one of the most digitalised industries. For many travel players, including hotels, tour operators, bedbanks, OTAs and flight consolidators, technology has brought disruption to almost every aspect of their businesses.

As part of this disruption, many players have embraced technology and foreign currencies to increase their competitiveness and drive growth. However, when it comes to FX risk, not everyone has managed to unlock their full potential in the safest way.

Working with our clients across the entire travel distribution chain, we see the following challenges affect multiple players time and again:

• Businesses that often buy at higher prices, due to the additional FX markups added by their suppliers
• Loss of competitiveness when selling in foreign currencies, due to prices not being aligned with the FX market
• Pre-hedging techniques that leave the company at risk of being under- or over-hedged and that impacts their competitiveness
• Ad-hoc hedging strategies (i.e. a non-policy driven way of picking ‘the right moment’ to hedge) that exposes company margins to market fluctuations
• Companies that have already reduced FX gains and losses by hedging from the invoice but still face economic losses due to FX

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