| Pages in topic: < [1 2 3 4 5 6] > | Agency policy updates re: the economy and our rates Thread poster: MGL
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| Cost of living | Dec 15, 2008 |
I think the idea that José was trying to communicate has more to do with the cost of living. Technology doesn't fall into that category.
If we consider only the cost of things that are necessary to maintain a minimal living standard, then I think José's assumption is mainly right, except maybe for certain isolated types of goods in certain local economies. Food and energy prices are skyrocketing at the moment, and even before the crisis, they have been increasing steadily f... See more I think the idea that José was trying to communicate has more to do with the cost of living. Technology doesn't fall into that category.
If we consider only the cost of things that are necessary to maintain a minimal living standard, then I think José's assumption is mainly right, except maybe for certain isolated types of goods in certain local economies. Food and energy prices are skyrocketing at the moment, and even before the crisis, they have been increasing steadily for the last decade. The cost of health services has been going up, and so has the cost of energy, whether it be fuel or electricity. Medication - ditto. Clothing - ditto. Housing - ditto. In some cases, the quality of the merchandise and the level of service has worsened while the prices have gone up at the same time. Even the ProZ membership was substantially increased lately.
When the cost of living increases, I don't see how a decrease in rates, in any trade and in any industry, can be sustained. At least here in Canada, wages have been going up for pretty much all types of jobs, except maybe for part-time work in big box stores. I don't see why it should be any different with translation. In any case, I haven't seen any decreases in service rates, except maybe for telecom rates - but that is a different story, since the pool of consumers has exploded over the last few years, which means that telecom companies can afford to charge less (and it doesn't take twice as much money to produce twice as many phone lines either). ▲ Collapse
| | | | | The "cheaper" things | Dec 15, 2008 |
Several colleagues optimistically pointed out things that are getting "cheaper" now. I'll address only two of them for a reality check.
Petrol getting cheaper in the UK. I wonder how much of it is due to some variation of exchange rates, and if any of it can be attributed to oil companies having decided to give Brits a break by cutting their gains. I went to England decades ago, but the first problem I faced there was that the hotel rates my travel agent gave me in USD were a... See more Several colleagues optimistically pointed out things that are getting "cheaper" now. I'll address only two of them for a reality check.
Petrol getting cheaper in the UK. I wonder how much of it is due to some variation of exchange rates, and if any of it can be attributed to oil companies having decided to give Brits a break by cutting their gains. I went to England decades ago, but the first problem I faced there was that the hotel rates my travel agent gave me in USD were actually in GBP, so that hotel was unaffordable. A standard 300 ml can of Coke there at that time cost in the £ 2-4 bracket, while today it costs some £ 0.30 in Brazil. I saw an ad recruiting an office clerk in London; typing, filing, and answering the phone - no professional experience required. Converting currencies and disregarding fringe benefits, that person would make exactly as much money as I was making in Brazil as Human Resources Manager at the world leader in wines and spirits. The point is that in the currently globalized marketplace, the British "money standard" is too high to be competitive, so maybe it's beginning to get adjusted by fuel prices.
Leading edge technology is a different game. In 1980 I met an American who had come to Brazil on a two-year assignment to "computerize" the company I was working for. He brought in his luggage the first microcomputer (an Apple II) I ever saw in my life. He told me how technolology works: "It costs one million dollars to develop a computer processor; then it costs another million dollars to manufacture all the units of that chip that will ever be made until it becomes obsolete."
(On a sidetracking issue, the 386 computer went speedwise up to the 40MHz DX. A friend brought a rare machine from Paraguay: a 386DX 55 MHz computer. Dazzling fast at that time, but the only one I ever saw of these, as the 486 was out already, and it was faster. An untimely flop.)
I have a whole series of such examples, but I'll take only a current one. The first DVD drives for computers in Brazil were sold for some USD 500 and were comparatively very slow. Now the fastest DVD-RW here can be bought for USD 25. Why? Because Blu-Ray drives are not lurking any more, but already turning around the corner.
My wife is changing cars right now. She traded in her 4-yo car, and got roughly as much as she paid for it brand new then. Why? Because the new model of the same car now costs about twice as much.
But we are talking about services here. Computerized word-processors and CAT tools have been in use for several years already. So whatever productivity gains that could have lowered prices already took place ever since. Hence right now lowering translation costs is merely paying less to the human side of the job, whilst humans are paying more to fulfill their basic needs.
Evidence of that is that if a translator were forced to work with the mid-80s tools of the trade (a 4.77 MHz PC-XT computer running Word 2.0, no electronic dictionaries, no Internet), the job should be much more expensive. Compare that with the present value of, say, a mid-80s model car, not for car collection purposes. ▲ Collapse
| | | | Vadim Pogulyaev 
Thailand
Local time: 20:34
Member (2007)
English to Russian
| End of story for me | Dec 15, 2008 |
Thank you very much for your email. I understand
your sentiments, however, we believe this is a necessary
course of action to mitigate the risk of financial problems
into next year that are expected. Our clients are feeling
the same pressures and are forcing our prices down by
15-18% and so we have no choice but take action at our end
also. We are asking for a 6% decrease in your rate in
order to cushion at least some of the impact of these major
reductions. Furthermore, our business is expected to grow
substantially again in 2009, and so we expect to be able to
offer more work. We feel it is therefore in your interest
to consider a more competitive rate, as you stand to be
more commercially attractive to us and will form part of
our exclusive pool of Russian translators.
My reply
Dear XXX
I regret to inform you, that I am ceasing cooperation with
your company as of now.
The reasons are obvious. I think it's cool that your
business is growing so substantially, but I see no reason
to pay pay for this growth from my own pocket.
Outstanding jobs will be invoiced ASAP. Have a nice week.
Good riddance, next time they would deduct 200 euro from my invoice to buy birthday gift for CEO, or ask me to pay them for sending me work.
I won't ask everyone to do the same, that would be too insolent of mine:roll:
[Edited at 2008-12-15 13:16 GMT]
| | | | | These people really are funny! | Dec 15, 2008 |
Apparently this isn't one of my agencies, as I've missed out on this great letter. And I feel left out. I would have greatly enjoyed replying to such a delightful business proposal.
@ Vadim: Discounting an invoice to pay for CEO gifts or bonuses is a marvelous idea. I'm sure that some of the industry "leaders" will adopt it gleefully. Again, I'll probably miss out on the fun, because I prefer working with smaller fish, whom I usually find more compatible philosophically  ... See more Apparently this isn't one of my agencies, as I've missed out on this great letter. And I feel left out. I would have greatly enjoyed replying to such a delightful business proposal.
@ Vadim: Discounting an invoice to pay for CEO gifts or bonuses is a marvelous idea. I'm sure that some of the industry "leaders" will adopt it gleefully. Again, I'll probably miss out on the fun, because I prefer working with smaller fish, whom I usually find more compatible philosophically  ▲ Collapse
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Vadim Pogulyaev
Thailand
Local time: 20:34
Member (2007)
English to Russian
| Small fish rocks | Dec 15, 2008 |
They don't have hungreds of useless MBAs around to feed, they don't pay millions of bucks to their management every year and on retirement (or lay off), most of them don't even need to market themselves.
That's why they can easily pay 10-14 eurocents, my best clients are small fish=)
| | | | | Oh, so now they're ASKING? | Dec 15, 2008 |
Vadim Poguliaev wrote: We are asking for a 6% decrease in your rate in
order to cushion at least some of the impact of these major
reductions.
Weren't they trying to unilaterally impose it?
Megan Lehmann wrote:
We are writing to communicate a necessary change in the payment terms set by AGENCY with its translation service providers:
1. Your standard rate will be reduced by 6%.
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José Henrique Lamensdorf wrote:
Petrol getting cheaper in the UK. I wonder how much of it is due to some variation of exchange rates, and if any of it can be attributed to oil companies having decided to give Brits a break by cutting their gains.
Apparently (i.e. this is what I hear on the telly and read in the papers), the pump price of petrol, in the UK anyway, is linked to the price of crude, with some time lag. And with some reluctance to drop prices either as fast or as far as they increase them, but hey ho, at least the illusion is there that we are paying a price vague related to the price of the 'raw material', as it were.
That is why our petrol is cheaper now, so they tell us - and why would they lie?
Anyway, the point was simply to point out that not absolutely all prices are rising inexorably upwards, not to discuss the economics of the situation. As Marijke pointed out, there are other things that are cheaper too, including laptops (like for like, anyway - and lower spec models are literally being given away here, with some mobile phone contracts). I'm not seeking to dispute that the cost of living overall is rising (although again there are rumours that deflation could hit the UK next year); I was merely pointing out that there are swings and roundabouts and that exceptions to universal generalisations can almost (ha!) always be found.
Now, back to the problem of the agency...
| | | | Abba Storgen (X)
United States
Local time: 08:34
Greek to English
+ ...
| I was warning... | Dec 15, 2008 |
I was warning, nobody listened. There are a couple of people here who think they know everything and think that just because they got lucky for a couple of years, and they have the answers for everything.
Translation agencies are feeling the pressure too, and sometimes they are not very polite in communicating it to their vendors. However, they are under pressure as well and intense competition.
I was warning about a 40% decrease in rates until the end of next year.
... See more I was warning, nobody listened. There are a couple of people here who think they know everything and think that just because they got lucky for a couple of years, and they have the answers for everything.
Translation agencies are feeling the pressure too, and sometimes they are not very polite in communicating it to their vendors. However, they are under pressure as well and intense competition.
I was warning about a 40% decrease in rates until the end of next year.
The average so far, from other translators I work with, is a stagerring 20% overall (including reductions in minimum fees, reduction in "editing time allowed", increase of time to pay invoices, etc). So, the fall is already 20% and another 20% remains for 2009...
The credit bubble affected all sectors and created multiple bubbles thourghout the economy. The translation industry is a part of this, a "semi-bubble". Eventually, translation fees will balance down and equalize to salaries of skilled, full-time, in-house semi-professionals... I wouldn't be surprised is by the end of next year (which is the real hard year) translation fees make up for $20 per hour on average, considering 500 words per hour for new text.
Of course, there will be exceptions for some jobs, but overall, I was right, and the others were wrong... most agencies lowered their prices (just a few increased them only for certain translators and projects), and the trend is pointing down.
By the way, 12 cents per word was the fee ten (10) years ago, so if anyone of you gets that price, that's not a success... considering inflation, it should have been 20 cents per word by now.
But don't blame the agencies. They are facing a bubble too, and they ae under increased pressure from clients, especially in the cyclic industries.
Anyone checked the best barometer for the global economy and its almost sureal fall? (that is, the Baltic Dry Index). Do you have any idea how much of translation work depends on that index? ▲ Collapse
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| Back up the train... | Dec 15, 2008 |
Eleftherios Kritikakis wrote: I was warning, nobody listened... I was warning about a 40% decrease in rates until the end of next year... but overall, I was right, and the others were wrong...
Woah there, I think this is a bit premature!!
One agency that we know of sends out letters reducing rates, and suddenly you're right about a 40% reduction across the board by the end of 2009? Is that according to your crystal ball? Can you pass some lottery numbers my way?
I think this is a situation dependent highly on language pairs, the specializations, translation quality (provided and desired), as well as potentially a whole host of other factors.
As for me, none of my regular (agency) clients have demanded reductions, and I don't expect them to! I have had less work this December (so far) than the last two Decembers, but the only month that has ever been regular for me in any way has been January (things come to a standstill).
So not only is it too early to say if I will somehow be *forced* to lower my rates, it is also nearly impossible to say if this short downturn (so far) has anything to do with what is going on right at this moment in the global economy, and certainly no way to tell, if this is true, how long it might last.
If you wish to broadcast widespread gloom and doom, that's one thing. But I think we could afford to wait a few months for the facts to catch up!
My 2c
| | | | Zoe Green
Italy
Local time: 15:34
Spanish to English
+ ...
| I've seen no change in business so far | Dec 15, 2008 |
This is the only agency who has attempted to impose a rate cut (I have not accepted it and do not intend to do so) and I have had to turn away a lot of work recently because I'm really busy. I don't think it would make good business sense for me to cut my rates because I might (or indeed might not) see a drop in business in a few months. I'll make that business decision as and when it's necessary, not when I'm so busy that I'm working round the clock!
| | | | | And just where is it that the sky is falling? | Dec 15, 2008 |
Janet Rubin wrote:
Woah there, I think this is a bit premature!!
Well, Janet - some men do have that problem, you know. And Eleftherios does seem intent on auditioning for the role of Chicken Little in the School for the Logically Challenged. While he's been busy predicting a 40% drop in rates, I've seen people increasing them in the face of the recession. I've probably increased mine an average of 20%, though a lot of that has been achieved through new acquisitions. Nothing new in that strategy, however.
There's nearly always some crisis or another, some excuse to explain why there is no hope. And anyone (like yours truly) who contradicts that is just neoliberal capitalist swine pinning the blame on the proletariat for its misery. And so on. It's a fun game at times, but really - with a bit of smarts you can often turn things your way even in a really lousy economy.
| | | | Abba Storgen (X)
United States
Local time: 08:34
Greek to English
+ ...
| Not a "crystal ball" | Dec 15, 2008 |
1) It's not "one agency", so far it's many of them.
2) What's the difference between "less work" and "reduction in rates"? Either way, your income is down.
3) It's not a "crystal ball", it's all economic indicators.
4) Has anyone watched this video? http://www.youtube.com/watch?v=2I0QN-FYkpw
It's about a great investor (actually, many others)... See more 1) It's not "one agency", so far it's many of them.
2) What's the difference between "less work" and "reduction in rates"? Either way, your income is down.
3) It's not a "crystal ball", it's all economic indicators.
4) Has anyone watched this video? http://www.youtube.com/watch?v=2I0QN-FYkpw
It's about a great investor (actually, many others) who were warning (and made fun of), just like I'm warning too.
In real prices (inflation) translators' real income is going down for 10 years now (it used to be 12-14 cents 10 years ago, depending on language pairs). Now, on top of it, we have the severe economic crises which affects agencies as well.
Talk to you again in March ▲ Collapse
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| Increasing rates for new clients... | Dec 15, 2008 |
Kevin Lossner wrote: I've probably increased mine an average of 20%, though a lot of that has been achieved through new acquisitions.
I just did an urgent translation for a new client last week, but we had a timing problem because they tried to confirm after 10pm CET.
So in the morning when I said - we need to agree to payment terms NOW if there's to be any chance of this being finished by your deadline, they just responded - we'll pay whatever your standard rate is.
OH BOY I wish I had quoted a 20% increase! As it was, I just quoted them the upper end of the scale for the year and didn't even tack on a rush surcharge. They were in the UK and I had an unusual attack of pity. I will have to make sure that doesn't happen again.
| | | | | Shame on you, Janet! | Dec 15, 2008 |
Janet Rubin wrote:
I just quoted them the upper end of the scale for the year and didn't even tack on a rush surcharge... I had an unusual attack of pity. I will have to make sure that doesn't happen again.
Indeed you must. As E. has wisely pointed out, this is a dog-eat-dog world, all the economic indicators show that we'll be frying up our pets soon to keep protein in our diets and this is no time to show mercy!!!! Jeez, next time you're in Germany, drop by Berlin and I'll turn you over my knee for that one
Actually, I probably would have done much the same thing, except that the "upper end" for the year is the new client rate. In a case of missed communication I'm not as insistent as I usually am about rush charges. The idea is to be firm but fair, not fleece anyone. I started raising my prices in response to real increases in the cost of living here, not because I had a sudden urge to play Pirates of the Caribbean. But I thought as long as I was at it, I might as well stash a few chests in the garden.....
| | | | | Oh, the ironing | Dec 15, 2008 |
Eleftherios Kritikakis wrote:
I was warning, nobody listened. There are a couple of people here who think they know everything
Ain't that the truth.
Janet Rubin wrote:
They were in the UK and I had an unusual attack of pity. I will have to make sure that doesn't happen again.
Yeah, 'cos like, we get free laptops with our petrol and stuff, you know
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