- Location of production facilities
- Raw material sources
(Worldwide diversification in effect pre-positions a firm to make a quick response to any loss from operating exposure.
The firm’s own internal cost control system and the alertness of its foreign staff should give the firm an edge in anticipating which countries will have weak currency.
Recognising a weak currency is different from being able to predict the time or amount of a devaluation, but it does allow for some defensive planning.
If the firm is already diversified, it should be able to shift sourcing, production, or sales efforts from one country/currency to another in order to benefit from the change in the post-devaluation economic situation. Such shifts could be marginal or major.)