What does the dollar devaluation against the Euro mean for US based manufacturers wanting to market in Europe?
Current exchange rates should encourage US manufacturers to explore marketing opportunities in Europe.
At the beginning of 2002 the monetary exchange rate between the USA and Europe was $0.89US/Euro. At that time US producers competing with European manufacturers in European markets found the dollars strength hampered export sales. Importation of European sourced products challenged US producers on their at home because the depressed Euro made imports relatively less expensive.
Today the tables have turned. With an exchange rate above $1.15US/Euro, products selling at the same Euro based price of four years ago bring in 30% more dollars. This also means, with all other things being equal, a US producer's costs in US dollars would have dropped about 30% relative to its European competition's costs in the last four years, making US producers more competitive.
For a US company that only markets its products domestically, exploring other geographical market opportunities could result in increases to both sales volume and profit margins. Companies now entering the European market have the opportunity to establish distribution channel partnerships with less competitive risk. While positioning these relationships to build sustainable brand recognition for when exchange rates reverse.