Training for Translators

Classes for translators and interpreters

Money


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!


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.


Corinne McKay

Constructive things to do if you're afraid of a work slowdown

So far, the language services industry seems to be holding up well in the ailing economy. Although I haven’t had as many inquiries from clients in the past three months, the size of my projects lately has been larger than usual; I finished 26,000 words this week and will start another large project next week. Posts such as Jill Sommer’s ‘Tis the season…to be overworked suggest that other freelancers have work stacking up as well.

Still, I have this ongoing sense that I should be doing more to prepare for a big event, such as a major client going bankrupt or a large invoice being unpaid. My favorite personal finance blog, Get Rich Slowly, ran a great guest post on this topic. Although it’s aimed largely at in-house employees, 10 essential steps to take BEFORE you’re laid off applies to freelancers as well. Note especially tip number three, “Start a blog that contains at least 50% professional material.”


Corinne McKay

Secrets of six-figure translators

…with credit to Barbara Stanny, the author of Secrets of Six-Figure Women (which would be a good topic for a post too!)

Lately (and this impression was solidified at the recent ATA conference), I’ve noticed a very positive trend in our industry, that of the freelance translator earning over US $100,000 per year. Right now, I can think of at least five freelance translators I’ve talked to in recent months who have either insinuated or directly said that for 2008 they expect to break the six-figure income mark. Here, we’re talking about a) people who make the bulk of their income directly from translation, not from markups on subcontracting, and b) gross income, not net.

Now, I don’t have a gripe with how much I earn for how much I work; I will earn more than the average for full-time freelancers in the ATA this year, and I work about 35 hours a week during the school year and about 20 hours a week in the summer, with four to six weeks of vacation. However, I think that we can all learn a lot from six-figure translators and their attitudes toward their work. From my unscientific research, here are a few observations on what it takes to earn more than 100K per year as a freelancer.

First, I think that six-figure translators are actually a very diverse bunch. Some charge extremely high rates, some make very efficient use of technology like CAT tools and speech recognition, some work very long hours. So, I think it’s important to realize that there are a number of paths to 100K, it’s not all people working in a certain language or living in a certain place.

Next, I think that in order to reach six figures, there are a couple of non-negotiables: being very, very good at what you do, having a targeted specialization or working in a niche language, charging higher than average rates and being a businessperson/translator, not a translator/businessperson. For example, the average full-time freelancer might translate 400,000-600,000 words per year. If you charge 10 cents a word, you have to translate almost double that amount to reach six figures. But at 20 cents a word, 100K starts to look practically doable. So, although not everyone making six figures is charging very high rates (which I would define as 35-40 cents a word and up, and yes, there are people out there who are commanding those rates!), I would say that if you are not averaging at least 18 cents a word, you would have to work very long hours or very, very efficiently to reach six figures.

Six-figure translators are rarely, if ever, generalists. I think that the exception to this rule is people who work in languages where the pool of translators is small enough that people don’t tend to specialize. Partially, I think that this results from the fact that specialization is the key to attracting direct clients, and very few agencies in the U.S. are willingly going to pay 20+ cents per word for common languages; if you break the 100K mark, you are undoubtedly working either primarily or exclusively for direct clients.

Surprisingly, the six-figure translators I’ve met are not the over-caffeinated stress machines that one might imagine. Rather, they seem to love their work and be happy that they have coincidentally found a way to make what one of them described as “a ton of money” doing it. Six-figure translators also talk about money a lot. While I’m sure that no one is going to attend a translation event and broadcast the fact that they charge five cents a word, I do think that willingness to talk about rates is a good tool for setting/raising your rates; when you meet someone who is as busy as they want to be at double what you’re charging, it is a good incentive to push your own rates up.

Six-figure translators also seem to concentrate on clients who care about the quality of their translations and the level of service they receive, not just about things being on time and on budget (although I’m sure they care about that too!). In her presentation about marketing to direct clients, France-based French to English translator Chris Durban talked a lot about selling “a translation that reflects the quality of the company’s products and services,” which I thought was a great way to distinguish translation as a non-commodity.

So, whether you’re setting your sights on six figures for 2009 or whether you’d just like to earn a little more than you are now, I think that six-figure translators have a lot to teach all of us about the way we run our businesses.


Corinne McKay

Choosing a pricing currency

For translators who work with clients outside their home base countries, choosing a pricing currency can be an important business issue. For the past year or so, pricing in euros (or if you’re European Central Bank President Jean-Claude Trichet, pricing in “euro”) has seemed attractive for those of us based in the U.S. When the euro was pushing US$1.60, it wasn’t hard to decide which currency was more attractive for pricing.

For better or worse, the dollar has been steadily rising, and today’s mid-market exchange rate is at to US$1.33 to the euro, meaning that the 2,000 euros that you charged a client three months ago would have resulted in a payment of about US$3,140 then and about US$2,660 today. So, is it better to price your translation services in your currency, your client’s currency, or some other variation?

A complicating factor is that when the dollar was doing poorly against the euro, for example back in March when the euro was at US$1.57, many translators decided to offer their services to European clients at attractive rates, in euros. As the dollar seems to be regaining strength, it brings up the question of who should absorb the difference; should the client pay the equivalent of what the translator was earning in dollars, or should the translator continue to earn the same amount in euros? And of course there’s the overarching issue of where the dollar is headed in general, with many economists predicting an almost worldwide recession in 2009.

It’s a tricky situation, and one that is probably best served through diversification and translator-client communication. As many other translators have commented lately, the more choices you have about who to work for and how much to charge, the better off you are when the economy is unpredictable; a good mix of clients in your country, other countries, agencies, direct clients etc. is the best protection against economic fluctuations. Likewise, it’s definitely acceptable to tell clients, especially new clients, that your rates and/or availability may change depending on the currency situation, i.e. “Right now, that rate in euros would equal my base rate in dollars, but if the dollar continues to rise against the euro, I might not be available at that rate in the future.”

Feel free to contribute your own suggestions as well!