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Two-edged business offer
Thread poster: Astrid Elke Witte

Astrid Elke Witte  Identity Verified
Germany
Local time: 04:49
Member (2002)
German to English
+ ...
Jul 24, 2006

An end client with whom I have been working for some time has made me a two-edged offer.

For some time, I have been doing two things for this particular end client. Firstly, as an individual freelancer, translations in my own language pair (German to English), that I do myself, and, secondly, in the capacity of an agency, processing translations in other language pairs, as well as offering other services (graphics, etc.).

Now this client, in the course of restructuring their firm and revision of their practices on buying in services and paying suppliers, has made me the following offer:

They offer to pay me 30% more for my translations as a freelancer on condition that I will lower my agency prices to a level that they specify. However, if I lower my agency prices to their specified level it will involve either paying fellow translators ridiculously low rates (or perhaps finding people not appropriately qualified, instead of professional translators) or accepting a loss of around 30% (occasionally 50%) on every single project, i.e. actually paying in order to do the work. However, this would, according to them, be compensated for by the benefit of getting 30% extra as an individual freelancer. At least 70% of the work is work that I do as an individual.

How would you react to such an offer?

Astrid


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tectranslate ITS GmbH
Local time: 04:49
German
+ ...
Tell them no, and why. Jul 24, 2006

Astrid Elke Johnson wrote:

An end client with whom I have been working for some time has made me a two-edged offer.

For some time, I have been doing two things for this particular end client. Firstly, as an individual freelancer, translations in my own language pair (German to English), that I do myself, and, secondly, in the capacity of an agency, processing translations in other language pairs, as well as offering other services (graphics, etc.).

Now this client, in the course of restructuring their firm and revision of their practices on buying in services and paying suppliers, has made me the following offer:

They offer to pay me 30% more for my translations as a freelancer on condition that I will lower my agency prices to a level that they specify. However, if I lower my agency prices to their specified level it will involve either paying fellow translators ridiculously low rates (or perhaps finding people not appropriately qualified, instead of professional translators) or accepting a loss of around 30% (occasionally 50%) on every single project, i.e. actually paying in order to do the work. However, this would, according to them, be compensated for by the benefit of getting 30% extra as an individual freelancer. At least 70% of the work is work that I do as an individual.

How would you react to such an offer?

Astrid

Reject it.

According to this scheme, they are not committed to keep sending you those 70% freelance jobs, but you are committed to sell agency translations to them at unfeasible prices.

What if you agree and they start sending you ONLY agency jobs from tomorrow on?

As a compromise, you could agree with them on some kind of renumeration scheme where you keep invoicing the same prices as always and at the end of each year, you determine whether they sent enough freelance work (money-wise) to make up for the low agency prices. If they did, you grant them discounts for the following jobs, effectively lowering the price AFTER the jobs are finished, invoiced and paid. This would keep them from screwing you over.

(Sorry if that seemed a bit difficult to understand, but I hope you caught my drift. Only commit yourself if they do as well.)

HTH,
Benjamin


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Isabel Booth  Identity Verified
Local time: 04:49
Italian to English
What if they've got a hidden agenda? Jul 24, 2006

Call me sceptic , but what is their real reasoning behind this? Would they be able to get cheaper rates by working with a "real" agency?
I'd be very wary because, I guess you have no guarantees that the current 70/30% percentage split will be sustained as time goes by so you could easily find yourself out of pocket...
What would their reaction be if you proposes to continue providing your own language pair and let them take care of the rest?
My 2 cents ...
Isabel


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Patricia Lane  Identity Verified
France
Local time: 04:49
French to English
+ ...
In addition Jul 24, 2006

Benjamin's suggestion is good.

But your client's "proposal" got my dander up a bit, I must say. If you go to any professional services provider (lawyer, accountant, doctor, whatever....) and suggest such a thing, they will send you packing. Your client may propose what he/she would like, but it is up to you, as the service provider, to set your terms, whether you are willing to compromise / make a counter offer or not. Your client is not running your business, you are.

Courage!

Patricia


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xxxsarahl
Local time: 19:49
English to French
+ ...
Here's your answer, Astrid Jul 24, 2006

Astrid Elke Johnson wrote:

They offer to pay me 30% more for my translations as a freelancer on condition that I will lower my agency prices to a level that they specify.
Astrid


*They* should set *your* prices? Now, what's wrong with this picture ?


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Michele Johnson  Identity Verified
Germany
Local time: 04:49
German to English
+ ...
Do you really need game-playing? Jul 24, 2006

I agree with Benjamin. What guarantee do you have that they'll continue to send you more individual freelance work at all? For that matter, what's keeping you from suddenly declining all agency-type work and only accepting the better-paying individual work?

The only reason I can see for doing this is to pressure you into reducing your agency rates, while farming the direct work out to someone else. If they had said directly: "We're so sorry, but we've discovered you're too expensive for us! Can we negotiate?", I could certainly respect that and would try to find a solution. But in this case, I would really tend to invest my time in acquiring other clients.

One question: how important is this customer to you? What percentage of your income do they account for?


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Astrid Elke Witte  Identity Verified
Germany
Local time: 04:49
Member (2002)
German to English
+ ...
TOPIC STARTER
Percentage of income Jul 24, 2006

Thanks, Benjamin, Patricia and Michele. I have to do some negotiating with them, because they represent 68.31% of my income. However, due to their desire to streamline business, the negotiations are supposed to consist of me accepting their terms, thus no negotiation is supposed to be involved. They more-or-less say "Take it or leave it".

They apparently have other suppliers, who supply them for exactly those rates, and, from now on, all suppliers are supposed to give them exactly the same rates. They also laid down an additional rule, that it is forbidden to charge extra for weekend work. Now, I have very rarely charged them extra for weekend work, but I did recently, when they contacted me on Saturday evening for an urgent job to be done by Sunday morning. As that was for German-English, the final rate that I charged them for that was still less than the increased rate they are proposing to pay me for that language pair and which their other suppliers, known to me (who only work on weekdays), presently charge them.

Maybe those who handle the money matters in that firm are simply expressing their dissatisfaction with me as a whole. However, other partners, not involved with money matters, claim that they find my translations reliable and that that is important to them.

Astrid


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Fan Gao
Australia
Local time: 12:49
Member (2006)
English to Chinese
+ ...
Just a comment.... Jul 24, 2006

Hi Astrid,

I don't know you but I've read many of your initiated topics and many of your responses to other people's topics. In my opinion you are in the upper echelon of translators in your language pair.

If you have any doubts with this proposal then I would take that as a strong indicator that all is not as it may seem.

I would concentrate on what you do best and not compromise your professional integrity.

They have obviously seen the talent in you that they can't find elsewhere and I would really hate to see someone of your calibre lose out or get "screwed over"!!

I just wish you good luck and whatever decision you make, I hope it works out well for YOU:)

Best wishes,
Mark


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xxxMarc P  Identity Verified
Local time: 04:49
German to English
+ ...
Two-edged business offer Jul 24, 2006

Astrid Elke Johnson wrote:

they represent 68.31% of my income


That is the problem you need to resolve before you make any other decisions.

Marc


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Natalya Zelikova  Identity Verified
Ukraine
Local time: 05:49
Member (2003)
English to Russian
+ ...
... Jul 24, 2006

I would apply these new offered rates to the work you have done for them during a few last months or a year - both as a freelancer and an agency - to see what would be your income in this case.
Also if you accept these new rates, try to agree the percentage of your work as a freelancer and an agency in acceptable ratio - this could help you to avoid the situation when they increase your workload as an agency and cut down your own workload. Finally, this can even be their plan behind this new offer
For example you may try to fix existing 70/30% ratio for each month and some compensation for months when this won't be reached.

(Still if you say that this change implies really too low rates for your translators, I would try to explain to the client that it's just impossible, as they can't get a good translation for such rate. Or you may try to offer another percentage - less increase of your own rate and less decrease of agency's rates.)

And try to keep every client's rate below 10% of your total income - you'll not depend on any of them. It's not difficult - just keep searching for new clients even when you have enough jobs.


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Claire Titchmarsh  Identity Verified
Local time: 04:49
Italian to English
+ ...
Stand your ground Jul 24, 2006

Hi Astrid.

You say "partners in the firm" - are they lawyers by any chance?? (looking at your profile it seems likely!!)

Good legal translators are not easy to find. If they were dissatisfied with your work for any reason they'd just say so. Lawyers love to negotiate, argue, and bluff, so just play them at their own game. Why should you fall in line with their other suppliers?? If they want to work under unreasonable conditions, good luck to them.

Even if they're not lawyers, stand your ground, don't charge a penny less than you're happy with and they'll come straight back to you as soon as their other provider turns in a bad translation - because if they're trying to cut their costs, they'll also cut quality.


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Dyran Altenburg  Identity Verified
United States
Local time: 22:49
English to Spanish
+ ...
Bad business Jul 24, 2006

Astrid Elke Johnson wrote:
Thanks, Benjamin, Patricia and Michele. I have to do some negotiating with them, because they represent 68.31% of my income. However, due to their desire to streamline business, the negotiations are supposed to consist of me accepting their terms, thus no negotiation is supposed to be involved. They more-or-less say "Take it or leave it".


So leave it.

My suggestion is to stand your ground and let them know why they would be smart to keep you as their supplier (quality, timeliness, etc.)

Unless, of course, all you can offer as added value is a reduced price, in which case you have absolutely no leverage and will be forced to jump whenever they tell you to.

Chain and shackles, anyone?

--
Dyran


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Lucinda  Identity Verified
Local time: 23:49
Member (2002)
Dutch to English
+ ...
Dear Elke, Jul 24, 2006

"they represent 68.31% of my income" To have one agency count for more than half of your income is scary.

I agree with all the excellent idees of the others but (like someone said before) I would strongly suggest that you immediately set up a marketing project for yourself.

Being dependent on one agency for such a large part of your income means that they can almost decide for you what you should decide.

While you handle the issue with this client, please make sure that you market yourself to other clients. Accept new jobs from new clients and establish a relationship with them.

Good luck!
Lucinda


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Catherine Bolton  Identity Verified
Local time: 04:49
Member (2002)
Italian to English
+ ...
If that's REALLY true.... Jul 24, 2006

Astrid Elke Johnson wrote:

However, this would, according to them, be compensated for by the benefit of getting 30% extra as an individual freelancer. At least 70% of the work is work that I do as an individual.



then why not keep things the way they are? They're saying your income won't change. So why do they want to change the current setup?
Unless they have something else in mind.
I wouldn't do it. Stand your ground. They're bluffing.
Most importantly, don't let it undermine your self-confidence. Because it really does sound like a bluff!
FWIW,
Catherine


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Astrid Elke Witte  Identity Verified
Germany
Local time: 04:49
Member (2002)
German to English
+ ...
TOPIC STARTER
Thanks for all your answers Jul 24, 2006

It is clear to me now what to do. I will either raise my price to them for German-English translations very slightly, or otherwise not at all at the moment. I will set down the price in writing, and state that it applies to translations done on weekdays only. To avoid a weekend surcharge, they will have to only give me the translations on weekdays.

As regards the agency work, I will set down in writing that I will not accept any project from them without first making them a written offer outlining the costs of the particular project concerned, which they can then accept or reject, at their leisure, in writing, after comparing it with whoever else's offer they please.

Astrid


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