Availability and convenience, scalability and upgrade support, security and integration — these are the reasons why most services used to be delivered in applications are now migrating online as SaaS products and services. Examples: Salesforce, Zoom & Slack — these companies demonstrate how SaaS solutions can improve business processes and operational efficiency. SaaS tools are affordable for startups and SMBs. But here's a common problem for both small and large businesses. Since both have to deal with international partners and customers, how do they price their products competitively for clients with different paying abilities? Part of the solution is to use up-to-date money exchange rates — this approach can reduce international transaction costs by as much as 10%.

Miscalculating exchange rates can lead to losses or customer dissatisfaction. Here, we'll talk about the importance of currency monitoring for startups, how it can help you set fair and competitive tariffs, and how to incorporate up-to-date currency technology into your pricing strategy

The Importance of Currency Monitoring for Startups

Currency exchange rates have a direct impact on the pricing, revenue, and competitiveness of SaaS products. For example, if the currency of the country (be it the USA or other) where the SaaS company is based strengthens, tariffs to foreign customers may increase. For the same reason, currency fluctuations also affect revenues, albeit to a lesser extent. Finally, currency fluctuations inevitably affect the competitiveness of SaaS products. Example, a weakening of a SaaS company's local currency may make its products more affordable to foreign customers. Criterion of importance:

• Pricing: Helps set competitive pricing for international customers.
• Revenue: Affects the company's revenue as exchange rates change.
• Competitiveness: Helps maintain competitiveness in international markets.
• Risk Management: Allows you to hedge currency risks and minimize financial losses.
• Financial Planning: Enables accurate financial planning and budgeting.

But this is where SaaS companies make a mistake. To simplify the management of pricing plans, SaaS companies often set fixed prices for international customers and partners without taking currency fluctuations into account. This results in hidden losses or overpayments for customers. Startups are the most likely to face unexpected costs due to currency fluctuations. According to research, companies that account for currency fluctuations are 20% less likely to experience dramatic changes in profitability. Global platforms like Zoom adjust pricing based on region.

Setting Transparent & Competitive Pricing for SaaS Products

Why is pricing transparency important for customer confidence in global markets? It's about customers' ability to make informed decisions and meet expectations — all of which you can lose if customers of your services see a discrepancy between the quoted price and the actual cost (due to currency fluctuations), which also reduces loyalty to the company. 

Accurate exchange rates are essential for setting fair and competitive prices. While a compelling argument is necessary to attract new customers, price transparency alone can secure loyalty and retain existing ones. An example of such a company that demonstrates transparency in pricing is Shopify — it adjusts prices according to the currencies of its customers. The mechanism of transparent pricing is implemented through APIs — the mechanism of accurate exchange rates into the payment system. This allows customers to monitor the actual cost of SaaS services or products in their local currency.

How to Include Relevant Courses in Your Pricing Strategy?

Potential customers of your SaaS product are international clients. The difference between them mares the amplitude of currency fluctuations (volatility), which can vary between different clients per trading session from 35-40 pips for low currency pairs such as EUR/CHF to 150-250 pips for high currency pairs such as GBP/JPY. To enable clients to make an informed decision about a SaaS transaction here and now, you offer them a transparent pricing formula that depends on the current exchange rate. Tariff transparency makes you competitive on the one hand, and on the other hand, if the resilience of your product or service is high, you can justify your prices by clearly linking them to currency market fluctuations. Both sides of the transaction benefit:

1. Exchange rate monitoring, which includes subscribing to financial news, using APIs to retrieve exchange rate data, and analyzing market trends on a regular basis.
2. Exchange rate impact analysis, which helps determine the extent to which prices need to be adjusted in response to currency fluctuations.
3. Dynamic pricing, enabled by integration with payment systems and subscription management platforms that support dynamic pricing.
4. Customer communication, which helps maintain customer trust and loyalty by explaining that price changes are related to currency fluctuations.
5. Currency hedging to protect against adverse currency fluctuations.
6. Regular review of strategy, enabling timely adaptation to new conditions and maintaining competitiveness.

This dynamic pricing approach allows SaaS startups to improve their pricing strategy while remaining agile and efficient in the global marketplace.

API Integration 

The API integration is as follows:

• Obtain an API key: Register on the platform and obtain a unique API key.
• Documentation: Familiarize yourself with the API documentation to understand the available methods and parameters.
• Requests and Responses: Configure sending HTTP requests (GET, POST, etc.) to the API and handling the responses.
• Testing: Test the integration to ensure that it works correctly.
• Implementation: Implement the API into your application or system to retrieve data automatically.

Implementing the API into the pricing strategy of your SaaS resource to automate the exchange rate minimizes the need for manual adjustments. Up-to-date exchange technology through platforms like Raters.fm can improve your pricing strategy and help your startup grow internationally. 

The Conclusion

Using the right exchange rates in your SaaS pricing is about more than staying competitive. It's also about building trust and ensuring the long-term financial stability of your business. Businesses can use dynamic pricing tools, market monitoring, and APIs to increase transparency and profitability. This allows them to offer fair tariffs, keep customers loyal, and avoid the risks of currency fluctuations. Startups that monitor currencies can better navigate international markets and grow more sustainably. Why don't you take advantage of it now?