Dealing with discounts: would you engage in an "investment"?
Thread poster: DoItInSpanish

DoItInSpanish  Identity Verified
United States
Local time: 09:47
English to Spanish
+ ...
Mar 9, 2012

Hi folks,

A good client I've been working with for a while has recently commented upon an upcoming task: the translation of over a thousand pages. It was not merely a 'heads up'; he asked me to take this job as an "investment", given that if he won this bid (this is a response to an RFQ), I'd receive work for the next 3-5 years (this is no BS). Now, he didn't ask me to do it for free, of course, but to lower my rate.

This is a lot of work, and I would have to involve colleagues of mine to help out as well.
I don't want to piss him, but I wouldn't want to lower my rate drastically, either. The docs would include lots of legalese, and are no easy task. I charge between 9 and 11 cents, normally, which is a very competitive price for the high-quality translation I deliver.

What would you do?

Responses from experienced outsourcers and independent translators would be greatly appreciated.

A.


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Samuel Murray  Identity Verified
Netherlands
Local time: 15:47
Member (2006)
English to Afrikaans
+ ...
20% for a regular client Mar 9, 2012

DoItInSpanish wrote:
He asked me to take this job as an "investment", given that if he won this bid (this is a response to an RFQ), I'd receive work for the next 3-5 years (this is no BS).


Assume that you're willing to lower your rate by 20% for this good client. Or is he expecting something more along the lines of an 80% discount?


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 15:47
Member (2005)
English to Spanish
+ ...
Raise your rate Mar 9, 2012

Clearly, you should reject this work. Yes, it is a long-term thing, will keep you busy a long time, etc. etc., but it will mean that you get overloaded and burnt when you get work from your other regular customers, and there will be many times when you feel stupid for being overworked for peanuts.

If they want you to take care of it, be it at your current rate, or even at a higher rate since it will mean some stress for you.


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Jenny Forbes  Identity Verified
Local time: 14:47
Member (2006)
French to English
+ ...
No Mar 9, 2012

No, I wouldn't accept the proposed discount.
If you did and the work actually materialised, it would mean that you'd be tied up for many months, working at less than your normal rate, and wouldn't be able to accept work from other clients who would have paid you at your normal rate and whom you might lose because of your lengthy unavailability. I think it would be perfectly reasonable for you to explain this to your client as set out above.
Best wishes,
Jenny

P.S. Also, once you had accepted a discount for this particular job, you might find the client expected you to continue to offer such discounts on other jobs.

[Edited at 2012-03-09 08:53 GMT]


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Thayenga  Identity Verified
Germany
Local time: 15:47
Member (2009)
English to German
+ ...
The same rate Mar 9, 2012

Perhaps you could tell your client that you would not lower your rate, but instead offer a higher discount for repetitions than you normally do. If they really want you to do the job based on their previous experience with you and the quality of your work, chances are that they might agree.

On the one hand it's good to know that you will be busy and have an income over the next 3 - 5 years. On the other hand, if you accept to lower your rates drastically, you might end up working more but earning less.


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 15:47
Member (2005)
English to Spanish
+ ...
Bird in the air Mar 9, 2012

DoItInSpanish wrote:
he asked me to take this job as an "investment", given that if he won this bid (this is a response to an RFQ), I'd receive work for the next 3-5 years (this is no BS).

Sorry, but that kind of you-will-be-busy-for-ever-and-ever expressions are BS. 3-5 years is a long time in business. The company could lose the work because of other language's defects, bankrupcy or change of plans of the end customer, change of some vicepresident at the end customer, bankrupcy of your customer, or even because they do not like your style and switch to another translator.

To me, this looks like (please forgive my rudeness) "prometer hasta meter", and you know how the saying goes next... Once you have bent to their wishes, they will use you only as long as they need, and then will drop you for another cheaper option at their earliest convenience.

Or maybe I am wrong: have they sent you any kind of draft contract stating that you will be the preferred translator (i.e. they will be under the obligation to ask you first) if they win the bid, with a precise description of the bid, the name of the end customers, the rates proposed and the volumes expected?


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Joakim Braun  Identity Verified
Sweden
Local time: 15:47
German to Swedish
+ ...
Nope Mar 9, 2012

3-5 years? The client, or the client's client, may have gone out of business long before that. Or perhaps someone in the chain has a change of management mid-way and gives the work to a cheaper outsourcer. Or whatever.

The only way this would possibly make sense is to apply a sliding discount to the big job, so that the discount only kicks in after you actually receive the promised work.


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 15:47
Member (2005)
English to Spanish
+ ...
Perfect! Mar 9, 2012

Joakim Braun wrote:
The only way this would possibly make sense is to apply a sliding discount to the big job, so that the discount only kicks in after you actually receive the promised work.

Absolutely. I have had similar situations and proposing the sliding YTD discount helped me:

A. Reach an agreement, stay busy (sometimes too busy), and keep the customer happy when they sent all the materials the had promised, or

B. Be paid at my rate for work done when the volume did not reach the promised levels, or

C. Get rid of a job that would have made me feel like a fool if I had accepted a global low rate.


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Vladimír Hoffman  Identity Verified
Slovakia
Local time: 15:47
Member (2009)
English to Slovak
+ ...
I would accept it. Simply and straightly. Mar 9, 2012

Fine, it maybe was a little exaggarated /just to attract an attention:-)/, but arranging steady flow of works for years is a kind of dream. I do know nothing about of your workflow, available capacity, number of clients etc., but you should at least sit and calculate. How could it influence my monthly revenues, will I have a capacity (and can I) to accept other works, how would steady, predictable workflow influence my working habits and so on.

In this point, you can not know how demanding the project will actually be, if there will not be ways how to facilitate your work (repeated text, CAT use, subcontracting of easier documents) and you will never know it, if you miss the opportunity.

Tomás says that the business for such a long time is uncertain and I agree with him, but what in our business is certain? There can emerge another crisis and small creeks will dry out, but big river will survive (just such big project saved me in 2009, when smaller sources started to disappear).

My advice is - just try it and if it would be obvious after some time that the work is not longer acceptable under such conditions, then (and only then) you should start to find ways how to get out.



DoItInSpanish wrote:

Hi folks,

A good client I've been working with for a while has recently commented upon an upcoming task: the translation of over a thousand pages. It was not merely a 'heads up'; he asked me to take this job as an "investment", given that if he won this bid (this is a response to an RFQ), I'd receive work for the next 3-5 years (this is no BS). Now, he didn't ask me to do it for free, of course, but to lower my rate.

This is a lot of work, and I would have to involve colleagues of mine to help out as well.
I don't want to piss him, but I wouldn't want to lower my rate drastically, either. The docs would include lots of legalese, and are no easy task. I charge between 9 and 11 cents, normally, which is a very competitive price for the high-quality translation I deliver.

What would you do?

Responses from experienced outsourcers and independent translators would be greatly appreciated.

A.


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DoItInSpanish  Identity Verified
United States
Local time: 09:47
English to Spanish
+ ...
TOPIC STARTER
What discount rate? Mar 9, 2012

Thank y'all for the responses. I really appreciate the debate that has taken place here.

I will probably reject an 'investment' criterion for offering a discount, but will offer a volume discount. Most of the easier documents will be outsourced to a team I've been working with.

Finally, what discount sounds fair to you? I was thinking of a 10-15%.

Regards


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 15:47
Member (2005)
English to Spanish
+ ...
Sure? Mar 9, 2012

DoItInSpanish wrote:
Most of the easier documents will be outsourced to a team I've been working with.

Are you sure this is what the customer wants?


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DoItInSpanish  Identity Verified
United States
Local time: 09:47
English to Spanish
+ ...
TOPIC STARTER
Yes Mar 9, 2012

They know of my modus operandi. There are times when the volume of work is not manageable by a single person, considering their time needs.

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Siegfried Armbruster  Identity Verified
Germany
Local time: 15:47
Member (2004)
English to German
+ ...
Trados rates might be a solution Mar 9, 2012

If the texts are similar in nature, you might get a considerable improvement in productivity when using Trados and a shared TM. You could offer your customer a discount for "repetitions" or "high fuzzy matches".

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Theo Bernards  Identity Verified
France
Local time: 15:47
English to Dutch
+ ...
How much time do you normally spend on marketing... Mar 9, 2012

...if you set that off against the total time you work in a week? For example, if you normally spend 20% of your time on getting new assignments (one day a week), it is a safe assumption that with a 10% to 15% discount, your weekly earnings from that particular assignment will still top what you normally would turn over. Might be something worth thinking about...

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Phil Hand  Identity Verified
China
Local time: 21:47
Chinese to English
My two cents... Mar 9, 2012

Yo también puedo ofrecer traducciones de alta calidad. Su cliente debe darme el trabajo.

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