Imagine this: a small business sets up in Australia, innovative in its quest to provide the mining industry with a product or service that was either not readily available overseas or could improve on a design or technology already in use.

It's fair to say this company worked closely with the end users, the Australian mining industry - world leaders in innovation when it comes to improving operational and safety initiatives on and around their leases.

Not to mention the fact they also get a kick out of seeing a fellow Aussie make it on the global scene.

As an aside, it's well known that wherever an Australian (young or mature) mining manager, engineer, geologist or entrepreneur tries their hand at anything in an overseas operation, they call on their supplier mates back home to "come over and show these guys what you have that can fix their problems".

So all is well for a time. The company most likely becomes a member of, and works closely with, the well-established and connected associations such as Austmine and maybe even gets a hand from the government agency Austrade, both bonafide groups that enhance the greater wellbeing of the industry in the global marketplace.

Now we're cooking. The leads expand, the inquiries come in and this small exporting company is well on the way to establishing an export market income. If the company's owners are smart, consultants have probably been brought in and commercial support has been analysed and developed, which hopefully looked at "what would happen if the exchange rate fluctuates?"

Note, for this scenario I am comparing with the US$ as the benchmark, and over the past five years, history shows the average exchange rate was around 0.72, a most respectable number. With a low of 0.52, and as we all know today, it can reach as high as a staggering 0.87!

The challenge is how does this fledgling company survive as the dollar goes into orbit? Harking back to our scenario, the company set its product's global price just 12 months ago assuming a 0.76 exchange rate, and at this level it was a market acceptable price.

It may have been a little on the high side compared to the competition - about 10% actually - however the international market place was prepared to pay for this premium because the Australian product provides value for money.

So our company was able to eke out a living on its global activities, albeit with international airfares and the like also getting more expensive as oil prices jumped around like the proverbial kangaroo.

The accountants looked hard at the books and said, "Well, as long as the dollar stays under 0.80 you will survive."

You don't have to be a Pitt Street accounting firm to work out what's been happening to this company over the past few months and weeks – the company is starting to do it tough and simply will struggle to survive when the dollar is soaring. For those without a calculator handy, the company's margins are heading towards a 15% increase in just 12 months. Let's just say their original gross profit margin was 20%: well now it's at 8%.

At this point I have to tell you I am not an accountant and haven't applied tax credits or the like. Not all exporting supplier companies work this way either. Some operate on a turnkey basis where costs can be offset, others on a 'do and charge' process but by and large, if one is a manufacturer then times are tough.

But instead I have played out a basic but real scenario which is affecting our exporting supplier network.

Of course there will be some swings and roundabouts depending on how long a company has been in the business of exporting, having profited at some stage with a lower exchange rate and, hopefully, put something in reserve for a rainy day should the exchange rate go up.

But that does not always apply either as usually a company will reinvest those funds to expand its operations, develop its output and grow the export market base. Maybe there were improvement gains in cost reductions of manufacture through these expansions; however one is doubtful if in fact the gains are keeping pace with the strengthening Aussie dollar.

I have absolutely no idea how this can be curbed, save for waving farewell to companies heading offshore to use cheaper sources. That is not what anyone wants to see, and I guarantee departments at all levels of government, locally, State and Federal are becoming alarmed.

We hear balance of trade is essential to a healthy economy, and no doubt the exporting minerals industry is having a marked effect on the figures. But alas, this is not helping the exporting manufacturing industry which is desperately and, I might add, proudly trying to grow and maintain itself on the global scene while representing excellent value, quality and service, commensurate with what Australians can deliver in all sectors.

As I just said, none of us wants to see our fine exporters forced offshore to survive. We want them to be winners and, while they will always stay winners nationally, being seen as winners internationally is also hugely important.

Oh, and a note to all international suppliers to the Australian mining industry - don't think this is 'open season' on our Aussie operations. We are not easy bait, we are watching and we have long memories.