Vinomofo sees ripple effect of savings and efficiencies with Airwallex

Online wine retailer Vinomofo is an Australian eCommerce success story. Their focus on good wines, real people, and epic deals has led the business to source wine from across Australia and worldwide. Now serving over 500,000 customers, predominantly in Australia and Singapore, CFO Kieran Donovan was looking for ways to boost the company's bottom line when he began focusing on operations in Singapore.

“There’s no local market of wine producers in Singapore, so everything we sell has to be brought in,” said Kieran. “It meant our operations there had 100% exposure to foreign exchange movements, which wasn’t sustainable, so we had to do something about it”.

The search for cost savings and ease begins

Initially, Kieran explored options with their Singapore banking partner but needed more room to negotiate better terms. “We didn’t really have any power with our banking relationship as we were considered too small a player, so we were paying high fees on each transaction,” said Kieran. “On top of that, our foreign exchange rates were high, and we lost money every time we converted Singapore dollars to Australian dollars.”

When looking for a solution, Kieran has two critical goals in mind. “We knew we were paying too much for foreign exchange, so the ability to save money was non-negotiable,” said Kieran. “But the other consideration was that we didn’t want to add any more complexity to the business. It had to be user-friendly, and we didn’t want to make anyone’s job harder.”

Kieran started looking into Airwallex after hearing positive feedback about the platform within the tech CFO community group he is part of. “I had seen enough people validate and advocate for Airwallex, so once I had that specific goal to reduce costs in Singapore, it was time to learn more,” said Kieran. “Henry, our now Airwallex account executive, had also been reaching out, so I began exploring things to see if there were enough potential cost savings to test Airwallex's FX & Transfers solutions.”

Initial tests show quick, tangible results 

The first step for Kieran was to see if there were enough tangible cost savings before testing out the tool. “After I saw there was enough potential cost savings, I began testing the platform by trying a few test transactions with the team,” said Kieran.

Kieran Donovan

Vinomofo Chief Financial Officer

“When our team saw how much we saved in just one transaction and how easy it was to use, they were all in”.

The next step for Kieran was to adopt the platform within the business, which he described as a simple and smooth process. “After signing on to Airwallex, I stepped through the first couple of transactions with our key accounts payable person,” said Kieran. “It was really intuitive, and once she followed the process flow a few times, she was really comfortable with using the platform.”

Tens of thousands saved every month along with faster transfers

“In our first transaction alone, we saved over 11% of the value of the transaction when converting Singapore dollars to Australian dollars,” said Kieran. “If you multiply that across the year, we’ll be saving tens of thousands of dollars compared to what we’ve been paying with our local banking partner in Singapore.”

In addition to savings on conversion rates, the business will also save on fees, which used to be $90 per transaction. “That's another saving of tens of thousands of dollars we can expect every year,” said Kieran. “To provide some context, our Singapore operations aren’t as big as Australia, so saving $100,000 (or more) makes a meaningful impact on our bottom line.”

While cutting costs was the main priority, Kieran has found several other benefits by working with Airwallex.

Speed of transactions 

“We’re seeing money transferred into accounts on the same day when it used to take up to three days with the previous platform.”

Smoother processes

“All of our transactions are going through with no issues, and we haven’t received a single call to request manual verification for payments - unlike our previous platform where we’d get occasional verification calls, even when we did all the right things.”

Ease of use

“The platform is really easy to use and intuitive - once our team tried the process a few times, they were comfortable to run with it.”

Making plans for more benefits 

Kieran sees these initial wins with Airwallex as just the beginning for the business. “Our next step is to roll it across Australia and take advantage of the full integration with Xero,” said Kieran. “We have limitations with our current banking platform around things like batch payments and setting up new suppliers, which I know Airwallex can help address thanks to full integration with Xero.”   

Kieran is also looking to reduce costs associated with Vinomofo’s seven-figure annual SaaS fees, most of which are charged in USD. “In addition to Airwallex’s competitive rates, I like that you can set up a virtual card of sorts for each subscription or supplier,” said Kieran. “It will give us better visibility and control of subscriptions, including who is spending and what they’re spending it on, and help us track subscriptions over time.”

In the longer term, Kieran sees how financial savings and faster transactions can feed into Vinomofo’s broader mission. “We’re always keen to work with innovative partners like Airwallex who can help us do business better,” said Kieran. “It means we can free up more time and money to focus on our mission of building our wine-loving tribe and having fun while doing it.”

Words of advice

Kieran believes any business with foreign exchange exposure could benefit by challenging the status quo with their current financial services provider. “If you’re paying any foreign exchange fees in your business, it’s worth checking out Airwallex,” said Kieran. “It’s really easy to test the platform and see what savings you could make before committing.”

Kieran Donovan

Vinomofo Chief Financial Officer

“There aren’t many initiatives we could implement to save our business around $100,000 annually without a huge amount of effort. It’s a pretty easy win, to be honest, and something I’d encourage any business with foreign exchange exposure to look into.”