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Agency keeps cutting rates - what should I do?
Thread poster: Soluna

Soluna
English to German
May 16, 2007

I have been working as a free-lance translation for one particular translation agency for many years. About 5 years ago my amount of work went down and on enquiring I was told that the market was difficult and they had to place work with translators who could offer more competitive rates. At the time I charged 60/1000 (English to German). I was told that if I charged 53/1000 I would get a lot more work again. I bit the bullet and my work load increased. I was now again asked to reduce my rate to 50/1000, basically for the same reasons. I feel very annoyed: not only did I take a huge cut 5 years ago but actually have been earning less every year because I haven't put my rates up. Now they are asking for even more! Do other translators face the same issue - and what do you do about it? I don't want to lose out on work but I feel unhappy about another reduction. Is the market really so difficult or are they are just trying to get a higher margin for themselves?

I'd be grateful for any opinions. Thanks.

[Subject edited by staff or moderator 2007-05-16 14:11]


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Zhoudan  Identity Verified
Local time: 12:07
Member (2007)
English to Chinese
+ ...
leave them May 16, 2007

I don't think you should waste your time with them. Try to find new clients.

[Edited at 2007-05-16 14:36]


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John Cutler  Identity Verified
Spain
Local time: 05:07
Spanish to English
+ ...
100% agreement May 16, 2007

Zhoudan wrote:

I don't think you should waste your time with them. Try to find new clients.

[Edited at 2007-05-16 14:36]


I couldn't have said it better myself!! Dust off your CV and take back your self-esteem.


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Mónica Algazi  Identity Verified
Uruguay
Local time: 01:07
Member (2005)
English to Spanish
UP instead of DOWN May 16, 2007

I had a similar experience with a translation agency. Instead of reducing my rates, I politely raised them slightly -and, believe it or not, it worked!!!

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xxxIreneN
United States
Local time: 23:07
English to Russian
+ ...
hmm... May 16, 2007

I understand you are talking GBP, which means that they offer you ~.10 USD/word. I would say yes, in today's market it may not be easy to find an agency willing to pay more or much more. I'm not saying such agencies do not exist but, unfortunately, it might be necessary to go back to square one and boost your marketing efforts to find those good agencies or direct clients if, for the latter, you are willing to be responsible for the entire package - all comminications/logistics etc.

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Niina Lahokoski  Identity Verified
Finland
Local time: 06:07
Member (2008)
English to Finnish
+ ...
You should raise your rates, not lower them May 16, 2007

I agree with Mónica. The agency is happy with the quality of your work, and you have obviously much more experience now than you had five years ago. Also the value you give to your clients is better. You should raise your rates and not lower them!

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Gisela Murdter  Identity Verified
United Kingdom
Local time: 04:07
Member (2005)
German to English
+ ...
it is not so easy... May 16, 2007

...to just 'go and find new clients'. You can only say that from the position of someone who has already more than enough well-paid work. Soluna doesn't seem to be in this position.

Soluna - the rates you are charging are on the low side for the UK. After all, you have to pay your rent/mortgage and other living expenses etc. Although it is an intriguing idea to raise your rate in such a situation, I doubt this particular agency will agree to it, since they have already managed to get you to lower your rate once. But it is certainly worth a try.

I suggest holding on to this agency until you have found new clients. See what happens if you refuse to lower your rate any further. You might have to agree to the £50/1000 if you don't have any other clients right now. This agency doesn't appear to be the negotiating kind.

But you MUST find other clients. Once you have established a client base willing to pay you at least £60/1000 or more, ditch these lousy payers. But right now you can only ditch them if you have some savings stashed away to tide you over - even if it grates you (it grates me just reading it).


Hold your head up high & good luck!

Gisela


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Soluna
English to German
TOPIC STARTER
Difficult for me to ditch them May 16, 2007

Thanks for all your comments. Unfortunately, like Gisela recognised, I am not in a position to ditch this agency because they supply about 95% of my work volume. I have been working with them for about 14 years and steadily built up a reputation and a good work volume. The only problem is the money. I realise that I really have to look elsewhere as I now realise how dangerous dependency on one agency is. I guess I've been lazy in that way!
I wonder whether my language combination is just too common....


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Anita Cassidy  Identity Verified
United Kingdom
Member (2005)
English to German
not just about language combination May 16, 2007

Soluna wrote:

I wonder whether my language combination is just too common....



Well, your language combination is certainly not uncommon, but you don't mention your area(s) of specialisation, which is also an important factor. I am rarely out of work for more than a few days, and my language combination is the same as yours!

My advice would be to send your CV to as many (reputable - check the Blue Board) agencies as you can and also try to find a few direct clients. Then, when you're ready to take the risk, tell your agency that you're raising your rate and make it clear that you won't back down. There are certainly customers out there who are willing to pay for quality and expertise.

Best of luck
Anita


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Soluna
English to German
TOPIC STARTER
Direct clients - a different ball game? May 16, 2007

I've hardly ever worked with clients directly in all of my career and don't feel that confident about it. I wouldn't quite know how to go about it as I am not really a great business person. But maybe I should give it a try, it seems sensible.

The thing is I'm still getting a lot of work from my agency and very often have to turn work down. I am just worried that if I don't give them the requested rate that will change because they will turn to cheaper translators. It may not happen, I guess it's a gamble.

For now I have decided to keep my rates at the current level and keep a close eye on my volume.


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Terry Richards
France
Local time: 05:07
French to English
+ ...
No, no & no again! May 16, 2007

Soluna wrote:

I've hardly ever worked with clients directly in all of my career and don't feel that confident about it.



Your new clients can be agencies too.

Soluna wrote:

For now I have decided to keep my rates at the current level and keep a close eye on my volume.



No, no & no again!

You are dangerously dependant on one customer. Any one customer can go away without a second of warning for any number of reasons. Believe me, this happened to me when I had an IT consulting business. I thought I was safe because I had two major clients who were both taking about 50% of my time (and flying me all over the World). They both went away in the same week (one went broke, the other stopped using contractors because of a board-level decision). Both customers were 100% happy with my work and both were begging me to drop the other customer so they could give me more work.

In the meantime, I had lost touch with all my old contacts because I kept turning them down. I never really recovered from this and eventually ended up closing down my business and taking a full-time job.

This could easily happen to you and it could happen tomorrow. It may be in the process of happening right now and you don't even know about it! An agency that keeps lowering rates is either:

1) Not doing very well, or
2) Doing very well at your expense.

They know how much work they are sending you, they know [roughly] what percentage of your possible time that represents, they know how dependant you are on them.

You need to find new clients and you need to do it now.

Once you start getting too busy to take work from your current agency, then it's time to talk about rates. And not about lowering them either...

Sorry for the long diatribe but I've been there and done that. I didn't get a t-shirt but I got some scars!

Terry.

[Edited at 2007-05-16 19:36]


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Williamson  Identity Verified
United Kingdom
Local time: 04:07
Flemish to English
+ ...
Really May 16, 2007

IreneN wrote:

I understand you are talking GBP, which means that they offer you ~.10 USD/word..


Or 0.07 eurocent per word. Which is rather low. 0.07-agencies are not that difficult to find.


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ViktoriaG  Identity Verified
Canada
Local time: 00:07
English to French
+ ...
If it's not already too late... May 16, 2007

I would play their game. I would tell them "Funny how you asked me to lower my rate just when I was about to raise it. Tell you what, since you're such a good client, I will forego raising my rates for another year. How 'bout it?" Then, take that year to diversifiy your clientele.

Remember, even in the short term, you're not just looking to replace that client with another - you want to replace them with many clients. I would focus on agencies to begin with and would not try to ask for rates much higher in the beginning. For now, you just want to have more clients, so let's focus on that. From now on, you should spend one entire workday per week tracking down prospects and trying to get contracts from them. It may lower your income by about 20% since you will not be actively working, but it is a great investment. Spend three months doing that and I guarantee you will get a few new clients who will give you a couple hundred Euros of contracts per month. Then, the next step will be higher rates and direct clients. Then, you can slowly start turning down work fom this client of yours, whom, by the way, I find downright rude for asking to lower your rates after 14 years. If anything, your rate should go up and not down, especially after all that time. This agency already hit the jackpot by having a translator willing to work at rates from 1993 (!) AND having the same translator working for them for so long. And then they want you to lower your rates??? What the &#$*?

Two rules: having many clients and being in the comfort zone for rates. Also, don't be afraid of getting too much work - you can turn it down when it's too much. And by having too much work, you can actually pick the ones from good clients who pay well and on time and who give you interesting work over work from people who, when you offer a hand, rip off your arm, complete with shoulder bone.

About language pairs, my main pair is EN > FR (one of the most common ones), I have three times less experience than you, get paid more and am gradually raising my rates with success. It's not because I'm smarter than average - it is because I make sure to always have plenty of clients and because I stick to my principles (one of which is that I never, ever lower my rates - they can only go up).

Don't be afraid, it is easier than you'd think. Market yourself and clients will come to you without you having to go to them. Spend a day per week prospecting and soon enough you will breathe much easier.

All the best!

[Edited at 2007-05-16 19:50]


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Gerard de Noord  Identity Verified
France
Local time: 05:07
Member (2003)
German to Dutch
+ ...
Keep smiling and seek other clients May 16, 2007

Soluna wrote:

Thanks for all your comments. Unfortunately, like Gisela recognised, I am not in a position to ditch this agency because they supply about 95% of my work volume. I have been working with them for about 14 years and steadily built up a reputation and a good work volume. The only problem is the money. I realise that I really have to look elsewhere as I now realise how dangerous dependency on one agency is.



Yes, you've been lazy and have become dependant on one supplier. Now you will have to swallow your pride and will have to accept that symbolic tariff cut. A threepence cut after so many years is a sure sign that you've not built up the reputation you thought you had. Work on for 0,05 GBP and find new clients wiling to pay 0,07 GBP or more. Your revenge will be sweet when you'll have to say "sorry, not available" to your former agency.

Good luck,
Gerard

[Edited at 2007-05-16 20:04]


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