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Thread poster: ProZ.com Staff
Poll: Have you ever offered your client a discount for fast payment?
ProZ.com Staff
Local time: 03:15
SITE STAFF
Sep 19, 2012

This forum topic is for the discussion of the poll question "Have you ever offered your client a discount for fast payment?".

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Clara Chassany  Identity Verified
Spain
Local time: 12:15
Member (2012)
Finnish to French
+ ...
I never get discount for paying my bills at the moment I receive them Sep 19, 2012

, so why should I make discount ?
Yet I am starting to think I should definitely charge more for late payments, as it seems that the new trend is paying late...


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Steven Sidore  Identity Verified
Germany
Local time: 12:15
Member (2003)
German to English
Sure, all the time Sep 19, 2012

Absolutely I give discounts to some customers for significantly faster payments (let's say 7 days instead of 30).

Cash flow management is one of the keys to hedging risk, so I view such discounts as another tool to ensure that my cash flow stays steady.

That said, I don't offer CAT discounts, so I guess it's a question of where you draw your line.


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Markus Perndl
Austria
Local time: 12:15
Italian to German
+ ...
Sure... Sep 19, 2012

... but only if they pay me higher rates for fast delivery

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Michael Harris  Identity Verified
Germany
Local time: 12:15
Member (2006)
German to English
No, never Sep 19, 2012

However, I did work for 1 company here in Germany where they offered their own discount system which I did use to a certain extent, but they still always paid later than they "promised".
Other than that, nope, never and I do not intend to. Fortunately, 80% of my customers are very reliable - touch wood!!


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Tim Drayton  Identity Verified
Cyprus
Local time: 13:15
Turkish to English
+ ...
No, never Sep 19, 2012

I offer a discount for advance payment, but have never done so for 'fast payment'.

[Edited at 2012-09-19 08:58 GMT]


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Thayenga  Identity Verified
Germany
Local time: 12:15
Member (2009)
English to German
+ ...
Once Sep 19, 2012

One client ordered the translation on Friday and received the completed documents the same day.
Because he wasn't in town over the weekend I "had to wait" until Monday when he personally stopped by my place and paid cash. No banking fees involved. That merited a 3% discount.

[Edited at 2012-09-19 09:15 GMT]


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Allison Wright  Identity Verified
Portugal
Local time: 11:15
Member (2010)
German to English
+ ...
No Sep 19, 2012

I have one occasional client who always pays the full fee in advance. His quotations are discounted.

I was once offered immediate payment after completion of a job on condition I accepted 2.5% less than the invoiced amount. It suited me at the time, so I said yes.

Payment longer than 30 days attracts a higher rate.


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patriciacharnet  Identity Verified
United Kingdom
Local time: 11:15
Member (2009)
English to French
+ ...
a couple of times Sep 19, 2012

from cheeky customers but most of the times it's payment in full

however I do request sometimes payment in advance from new clients with no discount


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Robert Forstag  Identity Verified
Local time: 06:15
Member (2003)
Spanish to English
+ ...
Not exactly, but... Sep 19, 2012

...I do sometimes impose the requirement of fast payment for new clients whenever their Blue Board record is less than inspiring.

I might also be inclined to accept a borderline-acceptable rate if fast payment is part of the deal (but, of course, there are always limits).

[Edited at 2012-09-19 12:51 GMT]


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José Henrique Lamensdorf  Identity Verified
Brazil
Local time: 08:15
Member (2007)
English to Portuguese
+ ...
Separating translation & financial costs Sep 19, 2012

IMHO it stands to reason that one should secure specialized professional services in any trade, and avoid hiring amateurs.

I've recently learned that UK banks lend money at something close to 8% interest per year. AFAIK transfering funds from PayPal to a bank account in the US costs nothing.

However I happen to live in Brazil. Here banks lend money at close to 10% interest per month (sic!). Transfering PayPal funds to a bank account in Brazil costs 6.5% in fees + 3.5% in the overtly lower exchange rate they adopt; in other words, PayPal costs me 10%.

I don't know of any bank that offers translation services, nor anyone of sound mind that would outsource translation work to a financial institution. Conversely, banks compete against each other on which offers loans at the lowest interest rate. Assuming that a professional translator should be an amateur in money lending, a translator should charge interest rates much higher than the least competitive bank.

A translation outsourcer paying any time later than COD is in fact borrowing money from the translator, as demonstrated above, an amateur in financial services. Now either that translator is of the 'desperate' kind, and funding the interest on the loan from his/her own pocket, or they are embedding the financial costs into their rates.

As we've seen above, such interest may be negligible. In the UK, interest on a 2-month loan would represent 1.3%, barely noticeable. However in Brazil it would mean 20%, quite significant.

My standard rate is stated for payment via PayPal within two weeks from delivery. I see no point in forcing the client overseas to yield to hefty Brazilian interest rates, so I keep the financial cost separate. If they want to pay faster, I will give them a discount. Even if their cash flow is riding a low tide, it's an excellent business decision for them to get a loan, say, at UK (or any other) interest rates to pay me pronto, in order to get a discount based on Brazilian interest rates.

Likewise, PayPal deducts 10% of any amount I receive through them. If my foreign client uses a bank transfer, Xoom (only from the USA), or any of those P2P systems (Moneygram, Western Union, etc.), I'll give them those 10%. I'd rather give that money (which I won't receive anyway) to my valued clients, than to PayPal, whose only 'favor' to me lies in delaying payments unnecessarily by 1-2 weeks.

One of my business tenets is to charge for everything I do, or most of it, however always striving to spare my clients from as much expense as I can.

I do understand however that in most countries there is no financial reason to give discounts for fast payment. This table should clarify the differences.


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Alex Hughes
Local time: 05:15
Spanish to English
What? Sep 19, 2012

There are clients that pay quickly?

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Oliver Lawrence  Identity Verified
Italy
Local time: 12:15
Member (2008)
Italian to English
+ ...
Sort of Sep 19, 2012

A customer took several months to settle an invoice, so when quoting for the next job (a few months later) I increased the price and added the condition that I would raise an additional invoice for an additional X% if payment had not been received after Y days. They duly paid after Y days.

[Edited at 2012-09-19 13:41 GMT]


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Yaotl Altan  Identity Verified
Mexico
Local time: 05:15
Member (2006)
English to Spanish
+ ...
No Sep 19, 2012

Why should I?

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Angie Garbarino  Identity Verified

Local time: 12:15
Member (2003)
French to Italian
+ ...
Strongly agree Sep 19, 2012


Steven Sidore wrote:

Cash flow management is one of the keys to hedging risk, so I view such discounts as another tool to ensure that my cash flow stays steady.


same here


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Poll: Have you ever offered your client a discount for fast payment?






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