A few months ago ELP looked at the impact an increasingly volatile currency market was having on procurement. And with the dollar showing no sign of recovery, consultancy firm neoIT has just published a research report examining the effect that currency fluctuations are having on the huge number of companies across all industries who are leveraging global sourcing.

According to the report ‘Currency Risk: Overcoming the Dollar’s Demise’, clients should brace themselves for a series of price hikes as the plummeting dollar continues to hit vendor’s profits.

The report also calls for clients to build currency fluctuations and hedging in global service contracts as part of contingency plans aimed at minimising the impact of these ongoing currency changes.

In addition, neoIT claim, current sourcing agreements need to be closely monitored to ensure that any price increases are not shielded by shifts in vendor practices and billing procedures.

Speaking at the launch of the report, neoIT CEO Atul Vashistha, said: "While the current downward movement of the U.S. dollar is not likely to result in major changes for global services clients, clients need to be prepared for longstanding vendors to undergo behavior changes.

"In India , for example, the U.S. dollar has slipped 8.5% compared to the Rupee since the start of 2007. Putting contingency plans in place now to deal with currency risk will help to avoid unpleasant surprises later in the year."

For some companies that unpleasant surprise has already presented itself, but for the remainder planning now could see them steal a march on the competition.