What when dollar value falls! Simple tips to ponder on
‘Wipro sees drop in US dollar outsourcing” , Tata consultancy reports a decline in dollar value” – sounds familiar to you? Yes now with the recent economic recession it is perhaps the most significant thing to worry, while juggling for fortifying your business portfolio.
The situation becomes even more complex as the wages rise continuously per annum while declining the profit margins for any IT outsourcing firm. “How to shield my company from the loss?”- The question has become the most glaring one of the recent era!
Ponder on the following tips if you are an IT offshoring firm and the drop in the dollar rates has affected you.
Restructure your billing rates: If you are looking for a quick fix to the issue then try to restructure your billing rates. Increase your bill rates by atleast 10-15 percent. Increasing your service charge will help you in maintaining to earn the same level of revenue.
Work on your billing hours: If you are not confident in increasing your bill rates for losing business, then try to increase your billable hours. You can make all the Saturdays working and by doing that you can increase the total billing hour to cover the dollar depreciation. Well, it might make your employees dissatisfied! Worry not, it won’t be a long term project and as soon the scenario improves you can go back to your 5 days week schedule.
Think of a contract agreement: To protect yourself from the loss with the depreciation of dollar value, you can customize your contract form and add a clause that if the dollar value drops, the client will bear the amount difference.
Expand your horizon: It is always better to think about a long term solution for any problem and when it comes to the hard fact of dollar depreciation a long term solution is indeed necessary. So it is now the time to expand your horizon and look around to increase your business outside America also. Try to build business market at Australia, Canada, UK , UAE and even tap your local market. You can also start billing in local currency and also invoice your clients outside USA in their local currency to avoid your dollar dependency.
Good Luck!
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