Rupee’s Slide Ruffles Outsourcing Customers

In this article about Indian outsourcing providers benefiting from the rupee’s devaluation, Partner David Rutchik offers quotable analysis on what enterprises can do to better leverage foreign exchange fluctuations. Sample excerpt: “David Rutchik, a partner at consulting company Pace Harmon, said that in recent deals he’s worked on where companies wanted to pay in dollars and not include foreign exchange provisions in the contract, ‘we’re often successful in arguing there shouldn’t be any COLA.’…The termination for convenience clauses frequently seen in outsourcing contracts give customers some leverage in renegotiating, said Rutchik…. ‘And from a relationship standpoint, [outsourcing firms] are usually pretty amenable to it. Most of the deals we do, there’s no minimum spend, so even if there’s not a termination clause per se, you can say I’m going to move” some of the work elsewhere,’ he said.””

Treasury & Risk