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Is it acceptable that a client lowers an already set rate?
Thread poster: Patricia Ballesteros Menéndez

Patricia Ballesteros Menéndez
Spain
German to Spanish
+ ...
Feb 11, 2016

Dear colleagues,

I have a client for which I have been working now for two years. It is a medium-sized agency, and they have recently asked me to lower my rate, as they claim to have renegotiated their own rates with end clients. This rate was agreed when we started our collaboration, and I can say it is not astronomically high, so I am not willing to accept this new condition; after all, I have not risen my rate for them in all this time, why should they have the right to decrease it?

I have the impression that this is not the usual procedure in our business, or at least not an ethical procedure, but I would like to know your opinion.

What do you think about this?

[Editado a las 2016-02-11 01:31 GMT]


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Bernhard Sulzer  Identity Verified
United States
Local time: 12:18
English to German
+ ...
Mirror, mirror Feb 11, 2016

Patricia Ballesteros Menéndez wrote:

Dear colleagues,

I have a client for which I have been working now for two years. It is a medium-sized agency, and they have recently asked me to lower my rate, as they claim to have renegotiated their own rates with end clients. This rate was agreed when we started our collaboration, and I can say it is not astronomically high.

I have the impression that this is not the usual procedure in our business, or at least not a very ethical procedure, but I would like to know your opinion.

What do you think about this?


If you are a freelancer, you are the one that determines your rate/price/fee. So if an agency asks you to lower your rate or it won't give you that project, you have two choices: you can accept or reject it. That they have possibly renegotiated their rates with the end client is no reason for you to follow suit. But it's up to you.
You can either charge reasonable rates or work for the bottom feeders of our industry. If you are experienced and educated (self- or otherwise), you deserve adequate payment. Working for peanuts turns you into a monkey, as many have said before.

As far as procedures in our business are concerned, there are many different (all) types of players in our industry. I stick with the ones I can trust and that pay adequately. It's the only way I can look at myself in the mirror.

[Edited at 2016-02-11 01:54 GMT]


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liviu roth
United States
Local time: 12:18
Romanian to English
+ ...
I couldn't have said it better myself! Feb 11, 2016

Bernhard Sulzer wrote:

Patricia Ballesteros Menéndez wrote:

Dear colleagues,

I have a client for which I have been working now for two years. It is a medium-sized agency, and they have recently asked me to lower my rate, as they claim to have renegotiated their own rates with end clients. This rate was agreed when we started our collaboration, and I can say it is not astronomically high.

I have the impression that this is not the usual procedure in our business, or at least not a very ethical procedure, but I would like to know your opinion.

What do you think about this?


If you are a freelancer, you are the one that determines your rate/price/fee. So if an agency asks you to lower your rate or it won't give you that project, you have two choices: you can accept or reject it. That they have possibly renegotiated their rates with the end client is no reason for you to follow suit. But it's up to you.
You can either charge reasonable rates or work for the bottom feeders of our industry. If you are experienced and educated (self- or otherwise), you deserve adequate payment. Working for peanuts turns you into a monkey, as many have said before.

As far as procedures in our business is concerned, there are many different (all) types of players in our industry. I stick with the ones I can trust and that pay adequately. It's the only way I can look at myself in the mirror.

[Edited at 2016-02-11 01:53 GMT]


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Kuochoe Nikoi  Identity Verified
Ghana
Local time: 17:18
Japanese to English
Look into the future Feb 11, 2016

If you accept this request even once, this will be you in a few years: http://www.proz.com/forum/money_matters/297887-agencies_lowering_my_rates_over_the_years.html

I'd immediately start looking for new clients if I were you.


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Suzanne Smart  Identity Verified
United Kingdom
Local time: 17:18
Italian to English
+ ...
Totally agree Feb 11, 2016

They negotiated with their client. So what? That has nothing to do with your arrangement with them.

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Mirko Mainardi  Identity Verified
Italy
Local time: 18:18
Member
English to Italian
+ ...
Idealism aside... Feb 11, 2016

(... and I do love idealism myself, btw)

I think the first question you should be asking yourself is: Can I afford to lose this client? If the answer is yes, then of course, do stand your ground and see how that goes, if not, then bite the bullet. In either case, start looking for other clients...

Also, I fear "business" isn't exactly synonymous with "ethical".


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 18:18
Member (2005)
English to Spanish
+ ...
Exactly Feb 11, 2016

Mirko Mainardi wrote:
I think the first question you should be asking yourself is: Can I afford to lose this client? If the answer is yes, then of course, do stand your ground and see how that goes, if not, then bite the bullet. In either case, start looking for other clients...

Exactly my thoughts. This is why it should be made a main priority for each and every freelancer NEVER to depend on a reduced number of customers. We should have at least 20 different customers and never allow any of them to mean more than 20% of our income. If we allow that to happen, we will have no defense against these unilateral cuts.


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 18:18
Member (2005)
English to Spanish
+ ...
Be firm, but explain Feb 11, 2016

Patricia Ballesteros Menéndez wrote:
I have the impression that this is not the usual procedure in our business, or at least not an ethical procedure, but I would like to know your opinion.

Unfortunately, this situation is rather common. All customers try to make you lower your rates at some stage, either for all projects, or for one particularly large end account.

Whenever I am confronted with this situation, my process is always to
a) thank them for their message, stating that I will think about it and get back to them about it;

b) let it lie for a week, so that I can think about my response, since deciding business matters in a hurry increases your chances of making a mistake you will have to live with for a long time; and

c.1) if the change affects my base rate for all work, I explain to them that my rate is very competitive already and perceived as very good value for money by my other customers, and that a quality translation takes time and therefore a certain cost, or

c.2) if the change affects one particular end customer or project, I try to find a rate in the middle of my rate and their new proposal, and clearly state that I accept this rate only for that particular project/end customer and based on the assumption that the yearly volume will be the one declared by the agency, also stating that if the said volumes are not reached, it is agreed that the original rate will apply again.

To sum up, you lose nothing by defending your rate. By defending your position, you are ensuring a more sustainable future, and are also perceived as a valuable partner by your customer, even if they had preferred that you to accepted their proposal immediately.

(Also, make yourself a plan to increase your customer base steadily within the next couple of years, so that in case you lose a customer, it will not be a big deal.)


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Teresa Borges
Portugal
Local time: 17:18
Member (2007)
English to Portuguese
+ ...
Exactly! Feb 11, 2016

Mirko Mainardi wrote:

(... and I do love idealism myself, btw)

I think the first question you should be asking yourself is: Can I afford to lose this client? If the answer is yes, then of course, do stand your ground and see how that goes, if not, then bite the bullet. In either case, start looking for other clients...

Also, I fear "business" isn't exactly synonymous with "ethical".


If you can’t afford to lose this client, try to negotiate: sometimes just a small gesture goes a long way. Otherwise, stand firm!


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Mirko Mainardi  Identity Verified
Italy
Local time: 18:18
Member
English to Italian
+ ...
You are definitely right Feb 11, 2016

Tomás Cano Binder, CT wrote:

Exactly my thoughts. This is why it should be made a main priority for each and every freelancer NEVER to depend on a reduced number of customers. We should have at least 20 different customers and never allow any of them to mean more than 20% of our income. If we allow that to happen, we will have no defense against these unilateral cuts.


... But, there is a "but"... I can't really see myself "juggling" too many clients at a time.
If I had 20 different regular clients, I could "spare" the time for about 600 words per week for each of them (tops)... and that's quite unrealistic (for me).

Still, maybe the optimum would be having several regular end-clients (at higher per word rates than agencies'), neither of whom requires a particularly heavy commitment over the week (risk distribution), although the downside would be the inherent waste of time (and usually added stress) of having to deal with such a large number of people/projects/topics every single day... (hence the "juggling" part)

That said, I am really jealous of those who have reached a stable balance that minimizes risk, and loss of time (and repressed anger...) while maximizing income and satisfaction and can therefore also afford to always treat all of their clients (be they the local pet shop or Microsoft and Google) on an equal footing and dictate their conditions.




[Edited at 2016-02-11 10:48 GMT]


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Gabriele Demuth  Identity Verified
United Kingdom
Local time: 17:18
Member (2014)
English to German
Lack of respect Feb 11, 2016

They first 'negotiate' with their client, and then 'ask' you to follow suit?

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Sheila Wilson  Identity Verified
Spain
Local time: 17:18
Member (2007)
English
+ ...
They should find another way to reduce their costs Feb 11, 2016

Patricia Ballesteros Menéndez wrote:
they have recently asked me to lower my rate, as they claim to have renegotiated their own rates with end clients.

If they thought they could still make a profit by lowering their rates, it should have been as a result of being able to reduce costs that they control: reducing staff numbers, renting smaller premises, reducing waste (consumables, energy, staff downtime...) etc. The only way they can control the cost of supplies, in this particular context of translations where quality presumably cannot be compromised, is to find someone who will do the same quality work more cheaply. There's no way they have any right to demand (or even ask, in my book) that you reduce your rates for doing exactly the same work. In most areas of business, it would never even be suggested.

And I think others have already made the point, but A CLIENT CANNOT LOWER A RATE. A client can say they can no longer afford to pay a supplier's rates, but that's all. A product supplier might then be happy to negotiate a lower price. For example, a manufacturer could change the process a little to produce a slightly inferior product that still suits the purpose - a cheaper paint job, maybe). A translator doesn't normally have that sort of negotiating room. Reducing the quality without potentially introducing major errors is not something that we can normally do, even if we were willing to oblige.

I imagine they've caved into a similar demand from a bigger agency. And now they expect you to do the same. Do it if you like, but expect exactly the same to happen in a year's time, if not sooner.


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Thomas Pfann  Identity Verified
United Kingdom
Local time: 17:18
Member (2006)
English to German
+ ...
Be aware of your client's poor negotiation skills Feb 11, 2016

Your client already told you that they are not good negotiators (otherwise they would have negotiated higher prices with their end-client). With that in mind, now it's your turn to negotiate...

Stand your ground and see what happens. Not lowering your rates does not necessarily mean you will lose the client - very often they are just trying to see what they can get away with. We don't always have to immediately fall on our knees and say 'Yes, of course'.

Maybe you actually reviewed your rates recently and ("because of the currently very strong global economy") you were just about to raise them by X per cent? And maybe ("because you do understand your client's situation and the pressures they are under") you would be prepared to raise your rates by a little less than X per cent or even delay the raise to a later date? Just as a gesture of goodwill and because you do value your partnership?

I admit aiming for a higher rate might be a bit too cheeky but why not play their game? (Unless of course, you really can't afford to lose that client - in which case you need to work on reducing your dependency on any one client.)

It is also worth pointing out that your client is not lowering your rate, but your client wants to negotiate the rate you charge them.


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Romina Navarro
Argentina
Local time: 14:18
English to Spanish
NO WAY! Feb 11, 2016

I think you already have several good answers here.

Has the agency asked you if you wanted to offer the client to lower the rates?
If THEY took the decision without asking you, THEY have to afford the loss, not you. It was THEIR business strategy to lower the rates... IF they actually have, maybe it's just a trick to get more profit by lowering only yours. You should think about this possibility too.

Beware! Once you have lowered your rates, they will never rise again.

[Edited at 2016-02-11 18:09 GMT]


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Alexandre Chetrite
France
Local time: 18:18
English to French
Precision Feb 11, 2016

Bernhard Sulzer wrote:

Patricia Ballesteros Menéndez wrote:

Dear colleagues,

I have a client for which I have been working now for two years. It is a medium-sized agency, and they have recently asked me to lower my rate, as they claim to have renegotiated their own rates with end clients. This rate was agreed when we started our collaboration, and I can say it is not astronomically high.

I have the impression that this is not the usual procedure in our business, or at least not a very ethical procedure, but I would like to know your opinion.

What do you think about this?


If you are a freelancer, you are the one that determines your rate/price/fee. So if an agency asks you to lower your rate or it won't give you that project, you have two choices: you can accept or reject it. That they have possibly renegotiated their rates with the end client is no reason for you to follow suit. But it's up to you.
You can either charge reasonable rates or work for the bottom feeders of our industry. If you are experienced and educated (self- or otherwise), you deserve adequate payment. Working for peanuts turns you into a monkey, as many have said before.

As far as procedures in our business are concerned, there are many different (all) types of players in our industry. I stick with the ones I can trust and that pay adequately. It's the only way I can look at myself in the mirror.

[Edited at 2016-02-11 01:54 GMT]


- Hello,

I would like to ask you a question:

you stated "If you are experienced and educated (self- or otherwise), you deserve adequate payment."

What about freelance translators who are highly educated by education and by themselves, but don't possess a great amount of formal experience (for personal reasons)? Do they deserve adequate payment too, or do they have to work for bottom feeders of the translation industry until they acquire this experience?
Please note that I stated "formal experience". Because one can have little formal experience and still have a lot of informal experience (self-educated in several fields, but not credited for it).And the other way around too by the way...


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