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From our June release: ProZ.com's online rates calculator
Thread poster: Enrique Cavalitto

Enrique Cavalitto
Local time: 07:36
SITE STAFF
Jun 7, 2006

Dear members,

As part of the June release you are kindly invited to visit http://www.proz.com/ratecalculator (or /Jobs/Rate Calculator) - a new tool for calculating rates.

This simple tool will help you to calculate the rate per word you should charge your clients in order to achieve a certain level of income.

Note the following:


ProZ.com’s rates calculator - User guide
a) Use any currency you want. Results will be in the currency you use.

b) Enter business-related costs as a yearly total. This field should include hardware, software, Internet connection, office space, business insurance, memberships, taxes, training, seminars, etc.

c) Enter your desired personal income expressed as a yearly amount. This would cover your living expenses, savings, personal insurance, disposable income, etc., and would be a pre-tax figure.

d) Enter the amount of hours per week you plan to dedicate to your translation business.

e) Enter the percent of your working hours that you spend actually translating. Don't forget to take into consideration such non-translation activities as communications (email, phone calls, chat), quoting, layout, file and document preparation and handling, billing, accounting, marketing, errands, training, breaks, etc.

Note: If you spend 2 hours in an 8-hour working day on non-translation business activities, then the percent of time you spend translating would be 6/8 = 75%

f) Enter your average words translated per hour, after adjusting for CAT tool use and other factors.

You may use units other than words (such as lines, pages or characters); results should be considered to use the same unit of measure.

Consider your net productivity during an average hour dedicated just to translation, as all distractions were considered in the previous point.

g) Enter the number of weeks of holiday you take per year. This should include not only leisure time but also days away from work spent in congresses, seminars, conferences, etc.

h) Click "Submit" to get the number of words you would translate per year and the rate you would need to charge to achieve your desired level of income. You may want to adjust the rate for jobs which will take more or less time than your average speed.

i) Two links are provided below the results: the first one takes you to the rates you have entered in your profile, while the second one leads to the site-wide average rates. Rates are shown by language pair.


Please feel free to post your feedback in this thread.

Once again thanks to you, our members, for making these improvements possible.

Regards,
Enrique


[Subject edited by staff or moderator 2006-06-07 21:18]


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Philippe Etienne  Identity Verified
Spain
Local time: 12:36
Member
English to French
Toying around Jun 7, 2006

Nifty tool!

I checked the validity of it first from a roughly actual situation: I think it gives a pretty accurate outcome.

I realize now that if I want to have 6 months of holidays a year, I have to charge much more than I currently do!

Good idea.
Philippe


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Susana Galilea  Identity Verified
United States
Local time: 05:36
English to Spanish
+ ...
I'm impressed Jun 7, 2006

I haven't tried the tool yet, but this seems an excellent step in the direction of helping educate both newbie and seasoned translators on how to "think" about their business from an entrepreneurial perspective. Instead of starting from the always abstract issue of "reasonable rates", figuring out those rates based on a provider's specific needs and income goals.

Thank you very much to everyone involved in this initiative.

Susana


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gianfranco  Identity Verified
Brazil
Local time: 07:36
Member (2001)
English to Italian
+ ...
A trick to include the tax Jun 7, 2006

This is a simple tool, over-simplified I'd say, in particular because it doesn't include the tax.
If you want to include them, at least roughly, the tool could be tweaked and used as described below:


  • First, you must have a precise, or at least an approximate idea of the total tax load in your country, and express it in terms of a single value in % (not very easy, I know...)

    This value should include all kinds of tax and contributions, for example: income tax, health contribution, local taxes, or anything else you may have in your particular situation and country.

    For the purpose of this example, we will assume that this value is 35%, but it could be much higher or much lower in some countries.


  • Go now to the field #4, where you can enter the "Percent of working hours spent translating", and factor into the value entered here your tax load.

    Here is a numeric example:


    If your "working hours efficiency" is 80% and your tax load is 35%, the value to enter in this field is 80% x 65%.
    (65% is what is left after a 35% tax)

    The value to enter is: 80% x 65% = 52%



    The advantage in doing this is that you can enter now in the field #2 your desired Net income and the taxes are taken out by the value entered in the field #4.

    If you have problems in estimating your tax load, ask for competent advice, and try the tool using this method.

    In any case, you could try several scenarios, and log them in a table. If you suspect that your tax is somewhere between 30 and 45, try 4 values (30%, 35%, 40% and 45%), and see how it affects the final rate necessary to achieve your desired net income.


    bye
    Gianfranco



    [Edited at 2006-06-07 21:40]

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  • Henry Dotterer
    Local time: 06:36
    SITE FOUNDER
    Thanks, Susana Jun 7, 2006

    Susana Galilea wrote:

    I haven't tried the tool yet, but this seems an excellent step in the direction of helping educate both newbie and seasoned translators on how to "think" about their business from an entrepreneurial perspective. Instead of starting from the always abstract issue of "reasonable rates", figuring out those rates based on a provider's specific needs and income goals.

    That is the idea exactly.
    Thank you very much to everyone involved in this initiative.

    And thank you for posting!


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    Henry Dotterer
    Local time: 06:36
    SITE FOUNDER
    Just enter your desired pre-tax income Jun 7, 2006

    Gianfranco Manca wrote:

    This is a simple tool, over-simplified I'd say, in particular as it doesn't include the tax...

    No need to get that complicated with this thing, Gianfranco. What we've recommended is that people enter the amount they would like to earn, as a pre-tax amount. The rest is simple.


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    xxxLia Fail  Identity Verified
    Spain
    Local time: 12:36
    Spanish to English
    + ...
    Great! Jun 7, 2006

    Henry wrote:

    Gianfranco Manca wrote:

    This is a simple tool, over-simplified I'd say, in particular as it doesn't include the tax...

    No need to get that complicated with this thing, Gianfranco. What we've recommended is that people enter the amount they would like to earn, as a pre-tax amount. The rest is simple.


    I probably didn't input the right figures, maybe underestimated my expenses, but I did input what I earn, so to be able to work a reasonable week/year (with hols! wow!), I should be charging more.....

    an eye opener, I probably realised it, but there's nothing like seeing the numbers crunched!


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    Yaotl Altan  Identity Verified
    Mexico
    Local time: 04:36
    Member (2006)
    English to Spanish
    + ...
    ho it works Jun 7, 2006

    It' very useful. Indeed, it's just sums and multiplications but ...

    ...the important point here is to show the issues related to get a final tax: income, taxes, hardware, working hours.

    If new translators learn how this calculator works, they'll love more our profession and defend it from low taxes agencies.


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    Alicia Casal  Identity Verified
    Argentina
    Local time: 07:36
    Member (2005)
    English to Spanish
    + ...
    Kool Jun 7, 2006

    Really works!!

    Thanks!!


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    Parrot  Identity Verified
    Spain
    Local time: 12:36
    Member (2002)
    Spanish to English
    + ...
    Don't forget Jun 7, 2006

    the approximate 10 days a year in bank holidays where applicable (I think every country has around 10 to screw up mice and men). And any tax shelters (housing, private pension plans, etc.). And assets immobilised on investments.

    Above all, have a heed to continuing education and the materials necessary. (Care to plan for a proz.com conference a year?)

    Plot your bonuses and contingency funds (sick leaves and sundry).

    Where working more than one service or more than one combination, calculate separately for them all - they're components of your business year.

    G'luck!



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    Walter Landesman  Identity Verified
    Uruguay
    Local time: 07:36
    Member (2005)
    English to Spanish
    + ...
    Quite accurate Jun 8, 2006

    I did all the "fill in the blanks" thing, and I ended up with about the same rate I am charging now. That`s a good thing, I think. It means I am on the right track.

    Interesting feature, Enrique.

    Saludos,

    Walter


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    Ritu Bhanot  Identity Verified
    France
    Local time: 12:36
    Member (2006)
    French to Hindi
    + ...
    Excellent Idea Jun 8, 2006

    Hi,
    Thanks for this new tool... I checked it out and it's just great. Especially for those who are new to the world of translation. They can actually use it to calculate their income and expenditure to get to the correct price. Hopefully, it will help stablize the prices for all of us.
    May be we could have the link on the home page at a prominent place so that those who want to enter this profession use it.
    Regards,
    Ritu


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    xxxMarc P  Identity Verified
    Local time: 12:36
    German to English
    + ...
    From our June release: ProZ.com's online rates calculator Jun 8, 2006

    Enrique wrote:

    g) Enter the number of weeks of holiday you take per year. This should include not only leisure time but also days away from work spent in congresses, seminars, conferences, etc.


    ... and sick leave.

    - Marc


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    Simon Bruni  Identity Verified
    United Kingdom
    Local time: 11:36
    Member (2009)
    Spanish to English
    nice tool but scary results Jun 8, 2006

    Walter Landesman wrote:

    I did all the "fill in the blanks" thing, and I ended up with about the same rate I am charging now. That`s a good thing, I think. It means I am on the right track.



    I must be doing something wrong. I need to increase my rates by over 50% in order to maintain my current (and not completely reckless) lifestyle!

    Hopefully I got my averages wrong.


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    Ivana de Sousa Santos  Identity Verified
    Portugal
    Local time: 11:36
    French to Portuguese
    + ...
    Nice! Jun 8, 2006

    I've just inserted some random figures (not exact ones) and the result was the rate I started charging since my baby was born (in November).

    I raised my rates at that time, but only for new clients because I don't want to loose my "old" ones, so I might not be earning what I would like to at the end of the year anyway.


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