Marketing

Mar 18 2009
Corinne McKay

Lowering your translation rates, continued

There were so many excellent comments on my last post about translation rates that I think the topic deserves another post. First, thank you to everyone who commented; I think that your insights are more valuable than what I originally wrote, because they represent the viewpoints of people in all different language combinations, geographic areas, levels of experience, etc.

A few new thoughts:
-It goes without saying that the higher up you are in the market, the easier things get (in my experience!). Once you pass a certain price point, you are almost sure to be working with clients whose only concern, or even primary concern is not price. That isn’t to say that mid and upper-level clients aren’t concerned about money, but I really think that these types of clients are more focused on quality, responsiveness, turnaround time, knowledge of their products and services, etc. than they are about badgering you for a rate cut. The highest-paid translators I know make 40something cents per word; my rates aren’t in that ballpark, but they’re high enough that I feel like I’ve progressed beyond the reverse auction mentality that characterizes the lower end of the market.
-Jill Sommer wrote a great post about rates today; it has some great advice. Jill points out that if you’re going to lower your rates past a certain point, why not do a different job all together? I have to agree with this; if I were making $20 an hour translating, I’d rather look at other careers.
-The currency issue is an interesting one, and I can really see arguments on both sides. In one sense, if I have some clients who pay more than others strictly because of currency exchange differences, I don’t see much harm in offering to harmonize the rate I offer those clients. In another sense, I agree that clients are usually more comfortable being billed in their own currency, and that the currency exchange equation goes both ways. Those of us who bill in euros and spend in dollars have been riding high for the past few years, but the pendulum may swing the other way at some point.
-I made the point about objective data because I am very guilty of this kind of nutty thinking. If you asked me if my current workload is higher, lower or about the same as last year, I’d say lower. But when I recently did my accounting, I found that I’ve actually earned about 25% *more* than I had at this time last year. Honestly, I think that this is because a) I listen to NPR too much and b) the beyond-depressing economic news is all around us. So, really really force yourself to look at *your* data, and remember that the world’s economy is not your economy.
-I really agree that you can’t blame customers for getting used to discounts if they’re repeatedly offered discounts. In a micro example of this that mirror’s Fred’s story about the mail-order business in France, I’ve found that if you buy something from Sierra Trading Post and then don’t buy anything else for a while, they’ll take the initiative to e-mail you a coupon for 20% or even 25% off. Now I don’t buy anything from them unless I receive that coupon; this probably works well for a huge retailer, but it’s not such a great business model for a provider of high-quality professional services.

-As Kevin pointed out, I also have to keep saying that I would rather work less than work more and earn less. Personally (and of course this is partially based on the fact that my husband has a stable, salaried job and thanks to our “urban Amish” lifestyle, we have a significant financial safety net), the idea of working less is actually not unappealing at all, in that it would give me time to work on some non-paying projects that I’ve relegated to the back burner. Everyone’s mileage may vary here; if you’re a single parent living paycheck to paycheck, obviously your decision may be different, but it’s good to see that others agree about this!

Mar 17 2009
Corinne McKay

Lowering your translation rates: why/why not

Lately it seems that many freelancers are considering lowering their rates because of the worldwide economic downturn. In most cases, I think that lowering your rates is an unwise business decision that devalues not only your own work, but the work of other translators as well. In addition, I really believe, based on my own experience and that of other translators, that the market for high-quality translation services is still very strong. However, I’ve recently spoken with a couple of people who have lowered their rates and feel good about the decision, so I think it’s worth looking at the why/why not equation that’s at work.

First, before you make any rate-related decisions, force yourself to look at some objective data. Are you really experiencing more “work drought” periods than last year, or does it just feel that way because the economic news is so bad? How much money have you earned as compared to the same time last year? How do your existing rates compare to what other translators in your language combination charge (you can get some information about this from the ATA compensation survey or from online rates surveys)? Are your clients asking for rate cuts, or are you just assuming that your rates are too high? Do you have a track record of attracting clients at your current rates, or are your rates set too high for your level of experience or for your language combination?

Because I am really not in favor of lowering rates, let’s talk about the disadvantages of lowering your rates. Most importantly, I think that if you look for work that pays less than what you’re currently charging, you’re bound to find it. Then, you’ll be overloaded with low-paying work and you’ll be unable to take on higher-paying work when it inevitably comes in. In addition, you really want to avoid the low rate treadmill: when you charge low rates, you have to work more, which can harm the quality of your work and your enthusiasm for doing the work, but you quickly get into a situation where you really have no choice except to work very long hours because your rates are so low. If your rates are high (not ridiculously high, but high enough that you have a built-in safety margin), a few days without work isn’t a crisis, and can even be a welcome chance to catch up on your accounting, spruce up your website or update your online profiles. If you’re working for low pay, you can’t afford the luxury of even a day without work.

In addition, I just think it’s very hard to put a positive spin on telling your clients that you’re willing to work for less than you’ve been charging. No matter how you couch it, it’s hard to avoid sounding as if you’ve realized that your work is worth less than what you’ve been charging, and that’s just about the worst impression you can give to a client.

On the other hand, you have to eat, right? Especially if you’re single/the family breadwinner/have little or no savings cushion, there comes a point where low-paying work is better than no work. In addition, there are translators whose rates are optimistic given their level of experience, specializations and/or language combination. So, if you decide that you really have no choice other than to cut your rates, try to do it as pragmatically as possible. Rather than a generic “You’re right, I’m not worth it! Whatever you want to pay me is fine…” e-mail to your clients, think about how to cut your per-word rate but maintain as high an hourly rate as possible. If you have a client who sends you easy work (very little to look up, doesn’t require complex formatting, client is painless to work with, etc.), offer them the lower rate first. See if clients will take on some of the time-consuming aspects of your work (such as formatting or PDF conversions) so that you can concentrate on the translation.

So far, my work volume and rates are both higher than they were last year; I say this not to brag about my business, but to say that the bottom certainly hasn’t fallen out of the translation industry. At the same time, I think that if I were faced with a shortage of work at my current rates, I would rather work 20% less than charge 20% less, then use the extra time to market to higher-paying clients, work on some non-paying projects or just have more leisure time and enjoy it. Before you surrender and lower your rates, it’s also important to be honest with yourself about your marketing efforts. If you haven’t sent out a resumé in five years, that’s a better starting point than cutting your rates with your existing clients.

Feb 24 2009
Corinne McKay

OT: Freelance frugality

I’m not normally one to talk about personal topics on my blog, but a few people e-mailed me about my last post, asking how the Thoughts on Translation household lives so cheaply. Given that financial management is an important part of making it as a freelancer, I thought that this question merited an OT post.

I feel well-qualified to write this post; I’ve been called cheap, a tightwad, quasi-Amish…one of my sisters-in-law even referred to me once as having “thrift issues.” But I can tell you this much: frugality works. Here at Thoughts on Translation, we carry no debt except our mortgage and we expect to have that paid off within 3 years, at which point we’ll start saving toward some level of financial independence (a term we find more uplifting than “early retirement”). The mantra of my favorite personal finance blog, Get Rich Slowly, is “Do what works for you.” Some people will cringe at these frugality tips but will have some of their own that I’m reluctant to embrace (feel free to post those in the Comments!). Here are some of my core frugality tips, separated by category:

Credit card debt: Out of the question. If you’re consistently accruing credit card debt, you’re living beyond your means, period.
Forced savings: We direct-deduct a percentage of our income into a savings account every month. If you never see it, you don’t miss it.
Transportation: We have never owned more than one car, and we have never owned a brand new car. Until 2008, we drove a 1991 Honda station wagon that we bought for $2,000 from an ad in our local supermarket. Last year we upgraded to a 10 year old Subaru station wagon. We drive as little as possible and use bikes and walking for most of our weekday transportation needs including my husband’s work commute, saving the car for major shopping trips and recreational use on the weekends.
Utilities: We don’t own a clothes dryer (hence the “quasi-Amish” reference); most of the time we can dry the laundry outside, otherwise we use drying racks in our basement. We don’t have air conditioning. We keep our heat on 65 during the day and 60 at night. All of our electronics (microwave, DVD player, etc.) are on power strips with on/off switches so that they don’t use any electricity when they’re not operating. Using these techniques (and switching to compact fluorescent light bulbs), we’ve cut our electricity usage to under 300 kilowatt hours per month, less than a third of what the average U.S. household uses.
Entertainment: Most of our entertainment consists of outdoor activities, on which we spend a fair bit of money (our total skiing budget is about $1,000 per year). We don’t have broadcast TV so cable isn’t an issue. We do have a DVD player but we only watch DVDs from the library or borrow from friends.
Cell phone: I have a prepaid cell phone (it’s OK to laugh…) on which I spend about $150 a year. Maybe I’m just not much of a phone person, but I’ve never found that I need more than about 100 minutes per month because I mostly use the cell phone as my personal pay phone. Probably 90% of my cell phone usage is to check my work messages when I’m not home.
Food: Tasty, healthy food is a big priority for us. We spend $600-$800 a month on food for 3 people. For health and environmental reasons, we buy mostly organic food. This bill includes nearly all of our meals, including my husband’s lunch for work and my daughter’s lunch for school; we eat out once or twice a month but rarely more than that. We pay about $450 a year for a share in our neighborhood-supported farming program and also grow a lot of our own food during the summer.
Furniture and home furnishings: We’ve never purchased a brand-new piece of furniture. Every piece of furniture in our house was either purchased second hand, trash picked (you can cringe, it’s OK!) or given to us. Ditto for our home furnishings; just after we moved into our current house, we scored a full set of dishes and glasses from a neighbor’s free pile (but I promise that we washed them really well before we used them). However, used sheets and towels are one place where I draw the line; some people are willing to delve into this black belt tightwad territory, but I’m in favor of buying these things new.
Bulk buying: When anything with a long shelf life is on sale, we stock up, and I mean really stock up. If I see a good discount on something like soap, dental floss, laundry detergent, olive oil, maple syrup, etc., I normally buy enough to last 3-6 months.

There are still some areas in which we can do better. I feel like we spend too much on long distance phone calls (using the default service from our phone line provider), but I haven’t had time to research better options or to test Skype with a wireless headset so that I’m not tied to the computer when I’m using it. I’ve thought about joining a food purchasing co-op for items like flour (of which we use a lot because we bake our own bread), sugar, coffee, cooking oil, etc., but I keep missing the order deadline for the group that is active in our neighborhood. We could probably save money by hauling our own trash and recycling to the local transfer station, but I’m willing to pay for the convenience of having it picked up at our home. I also keep meaning to look into high-yield savings accounts and CDs through reputable online banks. However, overall I feel that our frugal choices have really paid off and have allowed us to a) work toward things we really value, such as great vacations and saving for our daughter’s education and b) avoid being tied to unpleasant work situations simply because we need the money. I’d love to read other people’s frugal tips and insights too!

Feb 10 2009
Corinne McKay

Very part-time freelancing

Most beginning translators I talk to have similar goals for their nascent freelance businesses; they currently have a full-time job and they want to start freelancing part time, then gradually ramp up to full time freelancing as their work volume increases. Lately, I’ve come across a few beginning freelancers who have a different goal: they want to freelance very part time on a long-term basis. One of these individuals wants to freelance only in the summers (in combination with a teaching job), one wants to freelance only at night (in combination with being an at-home parent) and another wants to freelance only on the weekends. All of these people asked “is this possible?” and it would be interesting to get other translators’ takes on this too.

Here’s my take: I think that if you want to work on an “odd” schedule, you have to a) market to clients to whom this type of schedule would be an asset or a necessity and b) convince yourself that your unconventional schedule is a selling point, not a deficit. For example, it seems to me that many translation buyers (be they agencies or direct clients) struggle to find translators during the summer months, when many of their regulars are on vacation. Particularly in the month of August, when it can seem that every person who lives in or is originally from Europe is out on a beach chair somewhere, the translator pickings can be slim, which could open the door to a summer-only translator. However, I think that the challenge lies in reminding clients that you, the summer-only translator, exist between September and May so that come June, they’ll send you work. At a large agency, a significant portion of the project management staff could have turned over during this time, and even a small client will have handled reams of work during the winter months. So, I think that the summer-only translator has to keep up a steady flow of contact, even if he or she really only wants to work in June, July and August.

I think that people who work off-hours have it a little easier. For starters, these people can use time zones to their advantage and mount a “the end of your day is the beginning of mine” or “send me your documents on Friday afternoon and the translations will be in your in-box on Monday morning” marketing campaign. Translators who work off-hours might also do well, once they have some experience, to market themselves as “pinch hitters” for translators who work with direct clients. In my experience, translators are much more reluctant to turn down work from a regular direct client than from a regular agency client, because the direct client may find another option and stick with it. So, an off-hours translator could be a lifesaver when a translator needs some work done at the last minute; of course this involves a high degree of trust between the regular translator and the pinch hitter!

Any other ideas/experiences out there for translators who want to work while the rest of us are sleeping or playing?