It seems like a common question of late is “How is the economy affecting your job?” While translation may not be recession-proof, my sense is that most of us are doing fairly well even in the down economy. The reasons behind this could be a post in themselves: for one, the weak U.S. dollar makes it attractive for overseas companies to purchase goods and services (including translation!) here. So for now at least, it seems that most U.S.-based translators aren’t suffering from a lack of work.
However, unscientific evidence suggests that late payment and non-payment are getting to be more of a problem. For example, in the first 5 1/2 years that I freelanced, my late payment and non-payment problems were very minimal, and dropped to nearly zero after I started requiring individual clients (i.e. not established companies) to pay in advance. In the last six months, this situation has changed dramatically, and I’ve had to deal with three different non-payment situations involving established companies. In all three situations, I had reason to believe that the company was solvent and reliable; i.e. I had worked with them before or a trusted colleague referred me.
Interestingly enough, all three of these non-paying clients dealt with the situation in exactly the same way: by doing nothing. Whether I e-mailed, called, or sent a certified letter, they simply did not respond at all, except to sign the return receipt for the certified letter.
Because of this trend, I’ve revised my terms of service. In addition to requiring individual clients to pay in full in advance, I’m now requiring that if a company is not a member of ATA or a similar association or is not rated on Payment Practices, it must pay 50% in advance for at least the first project. I can still see some problems with this policy, but for now I feel that it protects me against a complete non-payment situation.
Is the economy changing how you do business?
Great post! I’ve listed some things going on over here on our blog, too.
I haven’t changed any of my business practices yet, but I am becoming pickier about which agencies I will work with and am thinking of marketing to some direct clients. Masked Translator also brings up some good points, so be sure to check it out.
While I haven’t changed anything yet either, I already require new clients to pay 50% up front. However, now that I think about it, I do have an outstanding invoice that’s overdue a bit — I shall send an e-mail about that now. I think it’s a good idea to require some form of payment up front (unless it’s a repeat customer, of course).
I really do worry about how the downturn in the economy will affect us. Hopefully clients won’t decide that translations aren’t a priority, because they are. I hope translations are recession-proof! I will check out MT’s comments as well.
I’m pretty happy with my business practices and clients right now: the vast majority of my customers are repeat end clients based in Germany and thus pay in euro. Nonetheless, I am thinking of trying to find a few new customers in case the unthinkable happens and one or more of my major clients goes bust. Hopefully I could also get rid of some work outside my area of specialisation if my marketing strategy is successful.
That being said, I am actually more concerned about my husband’s job than mine right now – he works at a large investment bank and keeps threatening to become a translator if he’s made redundant.
Oh dear, the nonpayment era is upon us again. In 2004 and 2005 I had a few clients that were either extremely late to pay or never paid, and at that point I threw in the towel with freelance writing and got a full-time editing job.
However, at the beginning of the year, I was laid off for economic reasons, and so I’m back to the freelance biz. It’s scary to think that again I’ll be uncertain whether I’ll be paid for all my hard work.
Hey C –
Great post. Do you get any pushback from the individual clients that you ask to pay 100% in advance? If so, what do you say to them?
Beth
@MT, thanks for your comment; your post is excellent, everyone reading these comments should read it too!
@Jill, I think that diversification is a great point; very important in this economy; thanks!
@Judy, I think that the 50% up front payment is a great idea. In some cases (for example if an agency has all 4 or 5 ratings on Payment Practices) I think that you can tell that they are reliable, but I’ve been amazed at who has not been paying on time lately. I also agree that my fuse is getting shorter when it comes to late payments. Previously I would wait 2 weeks or so before reminding an agency, and now I am down to no more than a week!
@Abigail, that’s a great point that people with in-house jobs may actually be more vulnerable than we are right now. While an in-house job is an all or nothing proposition, we have more options for replacing a lost client, even if it’s a big one!
@Laurel, it’s comforting to know that these cycles of nonpayment come and go! I actually think it’s a great time to get into freelancing, because companies are probably looking to cut in-house costs. At the same time, I think it’s also the time to either very closely vet your potential clients or ask for payment in advance.
@Beth, great question! It depends on the client. With individuals who need their birth certificate or something similar translated, it’s not a great loss if they look elsewhere, so I don’t budge on the full payment in advance. With companies, it depends on the situation. I might go down to 50% advance payment if the company shows other signs of reliability and it’s a project that I’m very interested in, but given my recent experiences, I don’t go any lower than that unless the agency is highly rated on Payment Practices. A few potential clients have offered references; I think this is a nice gesture, but unless I know the other translator involved, I feel like the reference could be anyone, even someone else who works at that company, so it’s not a big plus.
It’s sad that it’s hard to trust people you do business with these days, but you’ve got to look out for your own business and welfare.
I think the 50% payment up front is a good idea, and I don’t see why companies should get upset about that. If everyone were honest, it wouldn’t have to come to that, but with the economy being where it’s at right now, you can’t take the same chances as before.
I’ve had to write off a few non payees but luckily it wasn’t much money. I’ve learned my lesson, though.