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Another really big translation company asking for rate reductions
Thread poster: LegalTransform

LegalTransform  Identity Verified
United States
Local time: 07:42
Member (2002)
Spanish to English
+ ...
Feb 6, 2009

I just received this very polite e-mail from one of my agencies. I wonder how others are responding to letters such as these. Are some of you really contacting the agencies and offering to lower your rates??? [Note to Moderators: there is no company-specific data in this post]

"Dear Colleagues,

During 17 years in the translation industry (and 27 in business), I have witnessed my fair share of economic highs and lows. However, I have never experienced a general economic collapse on the scale we are seeing today. Of course, you all read the news and are aware of corporate cutbacks, layoffs, etc. etc. The drumbeat of bad news seems to go on and on.

Even typically recession-resistant industries are feeling the effects of this world-wide slowdown. More and more, our clients are approaching us for rate concessions - even our most stable, long-term clients are requiring us to produce the same quality for less money.

That's why I am writing to you to discuss prices. We are proud to have professional partners that are among the best in the industry – but also among the most expensive. Now, I'm not suggesting that expertise and quality don't merit financial reward. What I am saying is that starting soon, industry pressure will require us to make work assignments based on a strong consideration of price.

We have already spoken with a number of you regarding pricing - and I'm glad to say that everyone recognizes the need for cost reduction to retain clients and get through this challenging time (and maybe even *grow* our business). Several of you have already contacted us with offers for price reductions and discounts – and your sense of partnership is enormously appreciated.

Over the next several weeks, we will contact all approved suppliers to discuss potential price reductions. Please know that market conditions require us to make full use of our most economic resources: lower rates will help all of us to secure additional work. In the meantime, please email our Resource Manager with your suggestions for per word and hourly rate reductions - this will position you to receive more work right away.

Thank you for your understanding. With your help, we can take advantage of these opportunities and thrive in a challenging time.

Sincerely,



[Edited at 2009-02-07 03:51 GMT]


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KSL Berlin  Identity Verified
Portugal
Local time: 12:42
Member (2003)
German to English
+ ...
Let 'em hang. High. Feb 6, 2009

I've seen this tactic in good times too. There are two possibilities: there may be a real problem at the agency or they are hoping to stampede people into anticipatory rate cuts for problems which may or may not arise. Yet some agencies are doing well and maintaining prices, and increasing them along with payments to translators.

My response to such a letter would be to offer help is gaining business by offering better quality or service, but most certainly not at a lower price. Not unless that agency plans to pay the mortgage on the villa and do the landscaping. And pay the electric bills too, of course.

If people and companies want to play the lemmings game, it is their right to do so of course. In the end, those who play the price spiral game will inevitably lose out on quality and lose business as customers realize that in such a crappy economy there is often no choice but to invest in the best for your image.

As for the low end, hey - there's always Google Translate. And then they can give the money saved on translation to the lawyers.


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xxxLia Fail  Identity Verified
Spain
Local time: 13:42
Spanish to English
+ ...
alarmism + scare mongering Feb 6, 2009

Jeff Whittaker wrote:

"Dear Colleagues,

..... I have never experienced a general economic collapse on the scale we are seeing today.

Of course, you all read the news and are aware of corporate cutbacks, layoffs, etc. etc.

Even typically recession-resistant industries are feeling the effects of this world-wide slowdown.

More and more, our clients are approaching us for rate concessions.

.... I'm glad to say that everyone recognizes the need for cost reduction to retain clients and get through this challenging time .....

..... lower rates will help all of us to secure additional work .... this will position you to receive more work right away.

Thank you for your understanding. With your help, we can take advantage of these opportunities and thrive in a challenging time.



Jeff

If things are as bad as these people are painting things, even reducing rates isn't going to help:-) We - and the whole world - is well and truly screwed, apparently ... unless we drop our rates.

In ref to some of the comments above, no-one unless they were adults in 1929 has "experienced a general economic collapse on the scale we are seeing today". This person is unlikley to be in their 80s, are they? Even that comparison is doubful. How many expert people are around to judge? Isn't it hindsight that tells us how bad a recession was compared to a previous one?

As for reading " the news and (being) aware of corporate cutbacks, layoffs" that's panic-mongering, which should be punishable by law. Especially when used to cow suppliers.

"Even typically recession-resistant industries are feeling the effects of this world-wide slowdown. " How about a few examples of these "typical" industries?

"More and more, our clients are approaching us for rate concessions". So what - a downward spiral if everyone goes on with that same story. Our bills still remain to be paid.

"Everyone recognizes the need for cost reduction to retain clients and get through this challenging time". Hogwash, hold your ground within reason. I personally have decided where I'll make "concessions" but it's certainly not to agencies (buy price less sell price = margin, hence, client pressure = pressure on margins, hence apply pressure to providers - to maiintain margins. In other words, the pure profit motive).

"Several of you have already contacted us with offers for price reductions and discounts – and your sense of partnership is enormously appreciated."
Bullshit, no truly pro person would do that - they know what's at stake, and it's not just paying bills, it ¡s the business and reputation they have built up.

"lower rates will help all of us to secure additional work .... this will position you to receive more work right away. " What a bunch of lies, no idea of economics. If there isn't work, there simply isn't work. What they are trying to do is frighten us into feeling we drop down the list if we don't drop our prices.

"Thank you for your understanding. With your help, we can take advantage of these opportunities and thrive in a challenging time." Sod off:-)

If things are so so awfully bad, then all that's left to us is our principles, so let's stick by them, since the picture they're painting is a rotten one anyway:-)





[Edited at 2009-02-06 23:55 GMT]


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LegalTransform  Identity Verified
United States
Local time: 07:42
Member (2002)
Spanish to English
+ ...
TOPIC STARTER
Response from other agencies Feb 7, 2009

Very interesting. Sometimes it helps to pick up the phone. I called a few other agencies I work with and discussed the supposed "declining rates" issue and this letter with them. Not only did ALL of them state that the rate I charge is more than fair given the good quality of my work, but a few even informed me that they pay other translators in my language pairs even higher rates and that maybe I should raise mine!

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Aniza  Identity Verified
Malaysia
Local time: 19:42
Member (2007)
English to Malay
+ ...
How very true Feb 7, 2009

Hi All,

True Jeff. This is considered very polite.

But just like my friend say, when we were discussing this rate reduction issue, the situation affects both ways. If the agency is affected by the economy, does that mean WE the translators, don't?

It cuts both ways.

And like one agency says, "it's a pity if they consider cost more than quality" and that's when one translate "Duck!" in a subtitle as the animal duck, rather than lowering your body to take cover.

Have a pleasant week ahead!


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Jenn Mercer  Identity Verified
United States
Local time: 07:42
Member (2009)
French to English
Not for a second Feb 7, 2009

"We have already spoken with a number of you regarding pricing - and I'm glad to say that everyone recognizes the need for cost reduction to retain clients and get through this challenging time"

I call B.S. This is a psychological tactic to bring about a compulsion to conform.


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Balasubramaniam L.  Identity Verified
India
Local time: 17:12
Member (2006)
English to Hindi
+ ...
Yes, I received that letter too Feb 7, 2009

But I didn't reduce my rates. I told them that I was equally affected by the declining economy and the solution lies not in my lowering my rates, but in being more innovative, proactive and getting more business. I told them that I could help them by providing excellent professional service in my language pair, Eng-Hindi, which in any case I always do.

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Laurent KRAULAND  Identity Verified
France
Local time: 13:42
French to German
+ ...
Those following the wind... Feb 7, 2009

may well be blown away by it!

Some 10 years ago, my employer (a subcontractor to the automotive industry) asked their suppliers to lower their prices by some 10% "to maintain a good, long-lasting business relationship". I don't know if it worked as I changed jobs soon after that. What I know is that measures such as this did not prevent this company to shut down its French plant.

On a more serious mode, there's also a really big translation agency (not one of my clients, btw) threatening their outsourcees with sentences like: "If you don't lower your prices now that we are facing a worldwide crisis, we will not ask you to provide services for us anymore when things will improve!"

Nothing out of the ordinary, it is simply an attempt to play on irrational matters and on fears. To h*ll with that!

Laurent K.


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 13:42
Member (2005)
English to Spanish
+ ...
A possible reply Feb 7, 2009

"Dear customers,

Thank you for your message. I entirely agree that staying competitive is a must, so I have sent a letter to my electricity company, water company, the tax authorities responsible for VAT and indirect taxing, my bakery, my usual petrol station, my children's school, my cleaning aid, and other authorities and suppliers, asking them for a reduction of their prices and taxes in these difficult times.

After I have received their replies, I will calculate the average percentage of their price and tax reductions and will be happy to apply the same percentage to my rates.

Thank you very much for launching this very interesting initiative!
Best regards,
A link in the production chain"

[Edited at 2009-02-07 13:31 GMT]


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Ramon Inglada  Identity Verified
Local time: 12:42
Member (2006)
English to Spanish
+ ...
A very good reply, Tomás Feb 7, 2009

Tomás Cano Binder, CT wrote:

"Dear customers,

Thank you for your message. I entirely agree that staying competitive is a must, so I have sent a letter to my electricity company, water company, the tax authorities responsible for VAT and indirect taxing, my bakery, my usual petrol station, my children's school, my cleaning aid, and other authorities and suppliers asking for a reduction of their prices in these difficult times.

After I have received their replies, I will calculate the average percentage of their price and tax reductions and will be happy to apply the same percentage to my rates.

Thank you very much for launching this very interesting initiative!
Best regards,
A link in the production chain"


Very well said Tomás, I couldn't agree more.


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RNAtranslator  Identity Verified
Local time: 13:42
English to Spanish
+ ...
This part is not polite Feb 7, 2009

Jeff Whittaker wrote:

I just received this very polite e-mail from one of my agencies.

(...)

" please email our Resource Manager with your suggestions for per word and hourly rate reductions - this will position you to receive more work right away."


This is not polite, this is a threaten. If somebody says me "if you don't give me 1000 euros I shall kill you moth*******r!!!", that is a threaten. If somebody says me "I beg you to give me 1000 euros; doing so, you will live longer", that is a threaten too.

You can politely tell them that if they want their business to survive after this crisis, they need quality translators like you, and threatening is not the best way to keep you as one of their translators. (Yes, this is also a threaten).

¡Salud!

Ignacio Vicario Esteban



[Edited at 2009-02-07 15:51 GMT]


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Penelope Ausejo  Identity Verified
Spain
Local time: 13:42
English to Spanish
+ ...
Tomas' reply Feb 7, 2009

hahahahahhaa! I like it

I only got one such a letter, last October. They wanted me to reduce my rate by almost half. This was my reply:

My mortgage is going up, as well as all my utility bills. Stuff for the kids (school, nanny, clothing,...) has risen, same as the gas* for my car, food and every other thing. Reducing my rate would make it impossible for me to survive here.

If I were to work at your new rate, I would have to almost double my working hours. I currently work around 9 hours a day and I have 3 babies, so... definitely not an option.

Another option would be to deliver "the new rate quality". That would mean spending half the time on the same translation. You would receive a draft version of the translation with typos, grammar mistakes, words in English to be figured out in the context, etc. I don't think you want this either.

So, basically... I cannot lower my rate.

They didn't reply to my mail, but since then, they kept my rate and the workload from them hasn't decreased at all. I guess, not too many people accepted their rate decrease.



*gas is the only thing that has gone down since October.


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LegalTransform  Identity Verified
United States
Local time: 07:42
Member (2002)
Spanish to English
+ ...
TOPIC STARTER
Post removed Feb 8, 2009

Note: The original post was apparently removed by moderators and/or site staff. I do not know why. The company was not identifiable in any way (except by those who already received the letter anyway) and I should think that the views expressed in this thread would be of interest to the company as it moves forward with its business plans.



[Edited at 2009-02-08 15:00 GMT]


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KSL Berlin  Identity Verified
Portugal
Local time: 12:42
Member (2003)
German to English
+ ...
Very odd Feb 8, 2009

Jeff Whittaker wrote:
Note: The original post was apparently removed by moderators and/or site staff.


I was wondering about that. I've seen similar strange behavior like that on a few occasions: stern warnings about not mentioning specific outsourcers when none have in fact been mentioned. It makes me wonder whether the individuals involved have read the posts, need to develop reading comprehension skills or have been smoking something that they haven't offered to share. In any case, carry on....


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LegalTransform  Identity Verified
United States
Local time: 07:42
Member (2002)
Spanish to English
+ ...
TOPIC STARTER
Note included in original post Feb 8, 2009

Well, that is why I included a note to moderators at the top of the original post (stating that the company was not identified) because I realize that they do not have time to read everything through right away or sometimes hastily delete things even though I have been a user/member for over eight years now.


Kevin Lossner wrote:

Jeff Whittaker wrote:
Note: The original post was apparently removed by moderators and/or site staff.


I was wondering about that. I've seen similar strange behavior like that on a few occasions: stern warnings about not mentioning specific outsourcers when none have in fact been mentioned. It makes me wonder whether the individuals involved have read the posts, need to develop reading comprehension skills or have been smoking something that they haven't offered to share. In any case, carry on....


[Edited at 2009-02-08 15:38 GMT]


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Another really big translation company asking for rate reductions

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