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Why should volume discounts exist?
Thread poster: Bill Greendyk

Bill Greendyk  Identity Verified
United States
Local time: 19:35
Member (2002)
Spanish to English
+ ...
Jan 14, 2003

What is the logic behind giving so-called \"volume discounts\" in the translation field? What constitutes \"volume\" in the first place, given that the word \"volume\" in this sense is such a relative term?



I have a client that I\'ve been doing some work for periodically. Since my specialization is in religious literature, I deal with several large religious organizations. None of them have ever asked me for a volume discount, but then again, neither have I ever translated \"volumes\" or work for them.



I am in a dilemma. This particular client is, (or claims to be , like most religious organizations), a non-profit organization. He has presented a job that certainly qualifies as being large volume. Recently we went over all of the books, pamphlets, and magazines that he needs translated, and we realized that we\'re dealing with nearly 8 million words. Since we began discussing this job, he has been talking about a \"volume discount.\" When we discuss specifics, he wants to pay me, after all of my organizing other clients and doing some translating myself, between $0.04-$0.06 per word, less than half of what he would normally pay me.



This puts me in the awkward and/or impossible position to advertise for collaborators, no less do the work myself. Well do I know that there are places in the world where tariffs have dropped considerably, but do I want to contribute to that tendency????



I should give the credit to my dear friend and colleague Cecilia Avanceña here, who first got me to thinking about how illogical a \"volume discount\" really is. If a factory-worker who is paid per unit (piecework) produced twice as many units in a day as he/she normally did, would there be any sense whatsoever in he/her being paid half-price for the extra work? On the contrary, if a worker produces more or works extra hours, along come those niceties called \"overtime,\" \"bonuses,\" etc. Why should we, as translators, differ in this respect?



I\'d really like to hear your opinions about \"volume discounts,\" and if I may please add politely to this, I\'d really not like to recieve private mails asking me to collaborate in my 8-million word project, because it\'s very possible that it simply won\'t be accepted. Thanks for hearing me out!



Bill



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Erika Pavelka  Identity Verified
Local time: 19:35
French to English
'No' to volume discounts Jan 14, 2003

Hi William,



I am against volume discounts. One reason is that big projects monopolize your time, and often force you to refuse other work. So if you accept a reduced rate, you\'re losing some of the compensation for the work you have to refuse while doing the big job.



I also find that with big jobs, the 10th word requires as much concentration as the 10,000th word, so why should we work for less?



We have to remember that we\'re selling a service, an expertise, and that can\'t be counted in units.



FWIW,



Erika



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Rossana Triaca  Identity Verified
Uruguay
Local time: 20:35
Member (2002)
English to Spanish
Well, If you could translate... Jan 14, 2003

a crazy rate of 5000 words a day, every day of the week all year long, it would still take you about seven years to complete the whole translation. Since I guess you client is more hurried than that, you will probably make a team or outsource most of the material... still we are talking of at least a whole year\'s work secured and a total of USD 320 to 480 thousands dollar project.



The discount is given based on the security such a word amount provides, since I would ask for monthly payments and deliveries. Besides, if the material is of the same content, you will probably make some nice translation memories/glossaries on the first month that will certainly ease the rest of the work.



Moreover, it gives you a fair chance to be a PM if you want to try that out (or you could hire someone if that\'s not your cup of tea), and it leaves an impressive monster project on your curriculum.



You have to consider what your other opportunities are. Do you have secure work for the following year? More insteresting work? Better-paid? I keep on working on short technical manuals for which a glossary is made and then never again used; short websites; short brochures, etc. I have wasted more time in invoicing and DTP issues over 30% of my projects than actual translation time.



Looking at it coldly, cutting of a 50% of your rate may seem inappropriate at the very least, but you should consider how much marketing/harvesting time would take you to get 8.000.000 words and the time wast on accounting/invoicing short projects would take.



All in all, I do personally offer volume discounts to try to balance my load, but perhaps you already have long term projects and don\'t need to adopt that practice.



Good luck either way

Rossana



p.s. And after eight million words you can either convert to whatever religion it was or achieve a theology PhD


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Mary Worby  Identity Verified
United Kingdom
Local time: 00:35
Member
German to English
+ ...
Less admin and guaranteed work Jan 14, 2003

Hi Bill,



[Reposting as requested ]



I think the standard arguments behind volume discounts in translation involve administration, i.e. you obviously have to do less admin for one 100,000 job than for 100 one thousand word jobs, in terms of logging, invoicing, etc. Arguably, terminology research is also easier because you are unlikely to be confronted with one hundred times the terminology, and you are more likely to come across a term in more contexts.



The flip side of this argument is that larger projects often involve more coordination, liaison, etc.



The other argument often cited is that it is guaranteed work. So you don\'t have to spend time on marketing, negotiating new jobs, etc. All well and good if you wouldn\'t have been working anyway, but if you\'ve got plenty of customers who will be disgruntled by you being \'off the scene\' for a few months, the argument starts to look as if it doesn\'t hold water.



And the advantages of a high-volume job, even one of 8 million words, would never justify going down 50 % of your normal rate.



FWIW



Mary


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Silvina Beatriz Codina  Identity Verified
Argentina
Local time: 20:35
Member (2002)
English to Spanish
+ ...
Certainly not more than 50%! Jan 14, 2003

Even if it was really convenient for you to make a volume discount (and that\'s a big \"if\"), this discount should be smaller, certainly never above 50%! Whatever advantage you may have shrivels in comparison with the fact that you\'ll have to work more to earn less than half.







Besides, let me tell you that the advantages of mammoth projects are relative if they absorb all your time. That will leave you with less time or no time to deal with your other clients or be on the lookout for new and, chances are, you may well be left twirling your thumbs when the project is over. The only manageable way I can think of to do this is to set up a team of collaborators, and deal mostly with proofreading and unifying their work. But as you yourself say, the possibilities to find qualified collaborators with rates lower than 0.04-0.06 would be virtually nil (and they\'ll have to be qualified, otherwise you\'ll very well end up doing the whole job yourself, so what\'s the point?).

[ This Message was edited by:on2003-01-14 17:07]


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Dyran Altenburg  Identity Verified
United States
Local time: 19:35
English to Spanish
+ ...
Just say no Jan 14, 2003

[Reposting]



The translation is either for charity (in which case I would not charge at all), or it is a paid job (in which case I would charge full price).



8 million words sounds like way too much trouble for what they want to pay. I wouldn\'t even do it for three times that much.



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lcmolinari  Identity Verified
Canada
Local time: 19:35
Member
French to English
+ ...
Moderate discount OK Jan 14, 2003

I was intrigued by your posting because I myself was confronted with the issue of volume discounts for the first time a few months ago, though not anywhere near your 8 million words.



I also thought it made no sense, since I am still doing the same amount of work. Also, to complete a large volume in a reasonable time frame, I would likely have to outsource. Offering discounts could mean losing money on the part done by the outsourcer or risk using a very cheap one. This is not like offering volume discounts in sales where you can \"throw in\" a few extra units to customers who buy in bulk.



However, this was a potential new client who I was told was unhappy with the previous translator specifically because they did not offer volume discounts.



This is the offer I made: a 5-10% discount based on the word count I was given IF AND ONLY IF the client was willing to give me the time frame I specified to complete the job. This way, I wouldn\'t have to turn away my other regular clients and lose that income and by allowing myself plenty of time I wouldn\'t have to outsource either.



While I never heard back from this particular potential client (maybe the system\'s not so good!) I will continue with this policy volume discount policy.



The 50% your client wants is preposterous and perhaps if you explain that you would have to outsource this job, they may understand why you can\'t give a discount.



Good luck!
[addsig]


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Alexandre Khalimov  Identity Verified
Local time: 18:35
Russian to English
+ ...
Volume markups? Jan 14, 2003

Some quick thoughts:

I think that giving \"volume discounts\" diminishes one\'s professional stature, is bad business (for obvious reasons), and goes against simple common sense - why would you get paid less for more work. A large job project will require adequate management of all aspects of translation: liason between participating translators, terminology, collation, etc.



I say volume discounts are good for wholesale merchandising. More fitting for translation are volume premiums!!!

If a tranlator accepts an 8-million word project he engages to do the job of a lrage tranlation department. And it is not secret that the cost per word in such departments runs as high as $0.30/word and higher.


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Parrot  Identity Verified
Spain
Local time: 01:35
Member (2002)
Spanish to English
+ ...
One for the wish list Jan 14, 2003

I\'m really glad you aired this topic in public, Bill. And while I still stand pat on my previous reply (surcharge on excess volume if this requires output over and above the call of duty), it does give us an idea of how other sectors perceive the profession (translation = photocopying, only, with output in a different language).



It\'s not all that negative because it points us the way to go: client education. We have to explain ourselves - even if the agencies don\'t (ach, those vested interests). And this should be an ongoing ethical commitment. After all, we\'re building bridges, why not to the client as well?


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Patricia Posadas  Identity Verified
Spain
Local time: 00:35
Member (2002)
English to Spanish
+ ...
My two cents Jan 14, 2003

I am against volume discounts, although I would accept to apply up to 20% because I expect after doing the first million words you won\'t need to look up words in the dictionary and that saves time.



I would find it more appropriate to apply a by the hour rate. Thus, if you can go faster due to repetition etc. it will be reflected on the amount the customer has to pay and he will get his discount.



Other advantages such as saving time through not needing to look for other projects etc. may turn out not to be real advantages. After spending over a year on a project you may have lost quite a lot of customers and need to invest all that time you saved in finding new ones. I already went through this some years ago, after working exclusively for a couple of years for the same customer (at a price arranged as a monthly salary) I had great difficulty in finding new projects. I felt as if I had \'lost\' that time from the point of view of my career development.



On the other hand, if you outsource the margin should be big enough to compensate for the million problems that may (will?) arise. With the rates you mention I don\'t think this is possible.



Good luck!


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Cristiana Coblis  Identity Verified
Romania
Local time: 02:35
Member (2004)
English to Romanian
+ ...
discounts Jan 15, 2003

I have noticed that what some agencies call a volume is +10 000 words. Also some specify that for +100 000 words you should lower the price again. Usually I answer 5% for 10 000 words, 6% for 20 000 words etc. Just that.

Whereas it is better for you to accept to lower the rate and win a sure deal, you should always keep the losses down. A discount is not a gift or donation, it is an act of good will.

Incidently, I work with religious texts, too and I can appreciate what it involves. Also, it is a non-profit.

It depends on you and your plans. If it were for me, I would advise them to hire someone or rather a team of inhouse translators to deal with that huge volume. It might be the most price-effective solution for them.



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xxxTService  Identity Verified
Local time: 01:35
English to German
Proz and cons... ;) Jan 15, 2003

It just depends on... On my mood, on a job\'s volume, on the text\'s skill level, on the outsourcer\'s financial situation - and on MY financial situation.



If I got a job covering a volume of 8 million words I\'d gladly agree to a volume discount - IF I could do the translation by myself without needing other translators helping me with my work. I\'d see the clear advantages: No need to apply to other jobs, no surprises - because I know client and the text\'s nature.



But if the deadline\'s that tight that the need of supporting translators is quite predictable - I\'d not accept that discount, because it would become a serious problem to find other (good) translators working for - let\'s say - 3 cents per word.

Every client will understand that lowering the price of high-volume jobs will in most cases lead to lower translation quality.



So it\'s quite simple: If you can do it on your own - take the job and accept the conditions. If you cannot do it on your own - there\'s plenty much reason for negotiations.


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Marijke Singer  Identity Verified
United Kingdom
Local time: 00:35
Dutch to English
+ ...
Discounts Jan 15, 2003

Laura wrote:

This is the offer I made: a 5-10% discount based on the word count I was given IF AND ONLY IF the client was willing to give me the time frame I specified to complete the job. This way, I wouldn\'t have to turn away my other regular clients and lose that income and by allowing myself plenty of time I wouldn\'t have to outsource either.



I apply this option too with good results. Having a comfortable deadline is very important.



However, I work within a group of 4 translators and we quote prices based on the following:

2000 words a day at standard rate. If the customer wants more words translated in a day then we apply a surcharge of 50%.



You\'d be surprised how many customers suddenly can extend the deadline.



I don\'t think you should underestimate the time you\'ll need to manage an 8 million word project.



I work mainly in Trados and I do apply a discount for full matches and 80%+ repeats.


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Valeria Verona  Identity Verified
Argentina
Local time: 20:35
Member (2003)
English to Spanish
+ ...
For the sake of keeping a client Jan 15, 2003

Hi, Bill. Long time no see.

The only logical reason I find to offer a (moderate) volume discount is on request of the client and for the sake of keeping it. This of course, if you do want to keep on working with the client...

I would never go for big discounts, though.

Good luck.



Valeria


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Mark Cole  Identity Verified
Local time: 00:35
Polish to English
+ ...
Only if you set your own terms Jan 20, 2003

If this job will keep you busy over the next few years, it\'s worth considering. But make it clear how much you can do per month, leaving a little spare capacity for other clients. And most important, ask for a down payment of 20% (say) followed by monthly payments equal to your output that month. If they want a volume discount, you should get something in return!

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