That’s according to data from independent SME funder, Bibby Financial Services (BFS) whose Trading Places report surveyed over 500 UK SMEs that trade overseas.

54 percent of SMEs surveyed say they’ve been stung by volatile exchange rates in the past year, losing over £53,000 on average as a result. Over half (53%) reported that their business has lost up to £20k due to FX volatility in 2025, rising to 72% among the smallest businesses with 1-9 employees.

Businesses in the services sectors have been hardest hit: nearly two thirds (65%) of those businesses report being negatively impacted by currency fluctuations, 11 percentage points higher than SMEs on average.

This volatility is forcing SMEs to take a different approach to trading overseas. Nearly six in 10 (58%) have adjusted their FX strategy to mitigate the risks of currency fluctuations, and 59% of SMEs trading internationally are starting to make FX transactions in euros or sterling to mitigate US dollar volatility.

In part, this is being led by a shift in trading partners; 60% of SMEs surveyed say their business is now pivoting more towards European trade in response to the unpredictable trading environment. 

Michael McGowan, Managing Director of Bibby Foreign Exchange, said: “Businesses are navigating a period of sustained currency volatility not seen since the Great Depression. For SMEs trading internationally, a poorly timed transaction can significantly erode margins, leaving smaller firms particularly exposed. SMEs need to take practical steps to mitigate uncertainty and reduce the risks associated with currency fluctuation, such as diversifying trading partners or adjusting their foreign exchange strategies – or both.”

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