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Payment issues, what can you do without losing the customer
Thread poster: Teresa Woischiski

Edward Vreeburg  Identity Verified
Netherlands
Local time: 06:10
Member (2008)
English to Dutch
+ ...
totally agree with adrejs Jun 30, 2017

2 months delay already souds like they need the client to pay before thay pay you...
later payment shows their clients are late, and when they received money they first
pay translator who are waiting for payment even longer the you....

in short : bad financial management

So if any of their clients fall over, they are likely to fall over too.

if all of their translators accept 2 months delay that is about 10K - 40K+ per month for this agency
... See more
2 months delay already souds like they need the client to pay before thay pay you...
later payment shows their clients are late, and when they received money they first
pay translator who are waiting for payment even longer the you....

in short : bad financial management

So if any of their clients fall over, they are likely to fall over too.

if all of their translators accept 2 months delay that is about 10K - 40K+ per month for this agency
so 80K before any of you get alarmed...

advice - look for better clients....
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Kevin Fulton  Identity Verified
United States
Local time: 00:10
German to English
Time to find a new customer Jun 30, 2017

Every invoice a business issues represents a potential financial loss. In most situations, the business person has confidence that the invoice will be paid in a timely manner, according to agreed-upon terms. As a business owner, you have to decide how much you can afford to lose if the customer reneges on a bill.

You can live with a 60-day payment if the client can be counted on to stick to it, since once you've done jobs two months in a row, you can rely on money coming in every mo
... See more
Every invoice a business issues represents a potential financial loss. In most situations, the business person has confidence that the invoice will be paid in a timely manner, according to agreed-upon terms. As a business owner, you have to decide how much you can afford to lose if the customer reneges on a bill.

You can live with a 60-day payment if the client can be counted on to stick to it, since once you've done jobs two months in a row, you can rely on money coming in every month, although 60 days from the invoice date.

If you have to chase a payment, however, then you have to take into account risk management. Will waiting 90 days for payment jeopardize your own financial well-being? Pursuing a customer to get your money is very stressful, and if you have to do it regularly, then you have to decide whether the customer is worth it.

There are lots of agencies that pay on time. It's time to find some.
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Robert Forstag  Identity Verified
United States
Local time: 00:10
Member (2003)
Spanish to English
+ ...
Christophe is right Jun 30, 2017

I agree with Christophe that, although there is no excuse for the agency not paying you, you did indeed set yourself up for the problems you now face by repeatedly accepting late payments (i.e., beyond the already long term of 60 days) while continuing to also accept regular and substantial work from them. The repeated instances of non-payment, as well as the numerous negative Blue Board entries (I'm assuming that at least some of these entries were posted some time ago) ought to have served as ... See more
I agree with Christophe that, although there is no excuse for the agency not paying you, you did indeed set yourself up for the problems you now face by repeatedly accepting late payments (i.e., beyond the already long term of 60 days) while continuing to also accept regular and substantial work from them. The repeated instances of non-payment, as well as the numerous negative Blue Board entries (I'm assuming that at least some of these entries were posted some time ago) ought to have served as very large and bright red flags for you.

In this connection, I fully agree with Sheila: If you accept a 60-day term of payment, with this or any agency, then you really ought to make it very clear beforehand that payment within 60 days is a "hard deadline": you expect payment within 60 days and there will be no grace period. In practical terms this means that, if you do not receive payment by day 60, you immediately send a stern warning (not a gentle reminder) demanding immediate payment, and threatening to report the agency's non-payment on the Blue Board and similar directories, as well as possible legal action. And of course, you should not accept additional work until payment in full of the past-due balance has been received (i.e., if you still feel inclined to work with the agency after such a fundamental breach of trust).

Sixty days is really a long time! I therefore do not think any "cutting of slack" for delayed payment is warranted in such instances. But this is something that the freelancer really needs to make clear from the outset. By your past behavior, you have have implicitly accepted the agency's repeated delinquent payments. They have taken full account of this, and I'm sure that they are very appreciative of your understanding.

To me, it sounds like the agency is in financial trouble. This means that you are at serious risk of not getting paid, and therefore that you should not, in my view, even think about about continuing to work with them. Yes, this also means that you would have to forget about trying to salvage your relationship with this client - unless you are willing to accept that when they indicate that they "pay in 60 days," what they really mean is: "Ideally, you can expect payment within 60 days, but it is likely that you will not be paid for 70, 80, or 90 days, and perhaps even longer, and we expect you to be patient and not complain if such is the case."

And you have already indicated that such waits are a problem for you. So you need to make up your mind what you can live with here, and accept the consequences.

In a worst-case scenario, things may already be so bad that, in this instance, threats of yet another negative Blue Board entry and even of legal action may not have much teeth.

I sincerely hope that such is not the case, and I wish you the best in recovering the monies you are owed.

[Edited at 2017-06-30 22:09 GMT]
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Robert Forstag  Identity Verified
United States
Local time: 00:10
Member (2003)
Spanish to English
+ ...
Addendum to previous Jun 30, 2017

I think the best course of action is to forget about doing further work for this agency and to be very aggressive, threatening reports of non-payment and (especially) of legal action. Even consider getting a lawyer to draft a nasty letter now rather than later.

From the sounds of things, this agency has a lot of angry translators awaiting past-due payment to deal with. Many of them are like you, in that they have been very "understanding and patient." There probably are others thre
... See more
I think the best course of action is to forget about doing further work for this agency and to be very aggressive, threatening reports of non-payment and (especially) of legal action. Even consider getting a lawyer to draft a nasty letter now rather than later.

From the sounds of things, this agency has a lot of angry translators awaiting past-due payment to deal with. Many of them are like you, in that they have been very "understanding and patient." There probably are others threatening to take the kinds of punitive actions I am suggesting.

Guess which translators in these two groups will be paid first.

Obviously, taking such a hostile approach probably means renouncing any further collaboration with the agency in question.

Again, we can only hope that it is not too late.

[Edited at 2017-07-01 04:17 GMT]
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Teresa Woischiski  Identity Verified
Germany
Local time: 06:10
Member (2017)
English to German
+ ...
TOPIC STARTER
Thanks so much Jun 30, 2017

To everyone,

each answer was very helpful and you have given me very important information and insight on this matter. Thanks so much.
I have already taken steps that were long due.

I learned a lot from this.

All the best to all of you


 

David GAY  Identity Verified
Dutch to French
+ ...
My advice Jul 1, 2017

Your presentation should be more professional and less informal. The one you currently have sounds like Ola que tal? Vamos a la playa!

 

Teresa Woischiski  Identity Verified
Germany
Local time: 06:10
Member (2017)
English to German
+ ...
TOPIC STARTER
? Jul 1, 2017

David GAY wrote:

Your presentation should be more professional and less informal. The one you currently have sounds like Ola que tal? Vamos a la playa!


Hi David. Or better: hola che, que pasa huevón. Thanks for the kind advice.


 

Nikki Scott-Despaigne  Identity Verified
Local time: 06:10
French to English
Something to bear in mind Jul 1, 2017

In Europe, if no other agreement exists, the default deadline for payment is 30 days. In the real world, you can get paid much earlier or much later. 60 days is not uncommon, but I agree it is unfair. It is basically because an agency gives 30 day terms to their client and wants to be sure they get the money in before they pay it out. That is the standard argument anyway. The problem is, we can understand their reasons, but that is their problem, not yours, in theory anyway. In practice, they se... See more
In Europe, if no other agreement exists, the default deadline for payment is 30 days. In the real world, you can get paid much earlier or much later. 60 days is not uncommon, but I agree it is unfair. It is basically because an agency gives 30 day terms to their client and wants to be sure they get the money in before they pay it out. That is the standard argument anyway. The problem is, we can understand their reasons, but that is their problem, not yours, in theory anyway. In practice, they seem to be making it your problem too. If they start going beyond the 60-day term, be very careful. It is a sign that they may be having cashflow problems.

Even when it goes well, it is problematic for two reasons:
- it means you have to make sure you continue working for them on a regular basis, as if you have a break, you have to wait 60 days again;
- if the agency goes bankrupt, you have two months work you will probably never recover.

So, even if they pay at 60 days, make sure they are not you main source of income as it means you dig a hole for yourself.

Find other clients, agencies if need be but make sure you are not dependent on one client alone, particularly one with payment terms of that sort.
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José Henrique Lamensdorf  Identity Verified
Brazil
Local time: 03:10
English to Portuguese
+ ...
In memoriam
Call your bank... Jul 1, 2017

Call your bank manager, and ask if the bank provides translation services.
It is likely that they'll answer will be NO.

I did that, and was reassured that Itau Unibanco S.A. (Brazil), where I do my banking, does NOT offer, and does NOT intend to offer translation services.

Now ask yourself:
As a professional translator, do you offer financial (viz. money lending) services?
You'd certainly be an amateur among the institutions that do it.

We
... See more
Call your bank manager, and ask if the bank provides translation services.
It is likely that they'll answer will be NO.

I did that, and was reassured that Itau Unibanco S.A. (Brazil), where I do my banking, does NOT offer, and does NOT intend to offer translation services.

Now ask yourself:
As a professional translator, do you offer financial (viz. money lending) services?
You'd certainly be an amateur among the institutions that do it.

Well, banks - the pros in this trade - compete against each other on who offers loans at the LOWEST interest rates. As a complete amateur in their industry, you should charge the highest interest rates imaginable. You could charge, say, 20% per month interest on loans!

As you don't have an inventory of "prêt-à-porter" translations bought on long-term credit to sell, you are doing them word by word, as they come, any payment term you offer beyond cash on delivery is equivalent to granting your clients a loan.

Explain all this to your client.

Your goal is to convince them that:
- whenever they need a translation, you are their best option, NOT a bank;
- whenever they need to borrow money, a bank is their most sensible option, not you!.
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David GAY  Identity Verified
Dutch to French
+ ...
Your tagline Jul 1, 2017

Teresa Woischiski wrote:

David GAY wrote:

Your presentation should be more professional and less informal. The one you currently have sounds like Ola que tal? Vamos a la playa!


Hi David. Or better: hola che, que pasa huevón. Thanks for the kind advice.

I meant you should change your tagline because DEIN is too informal. A client is not a pal. You should at least replace it by IHR, which is more polite. The tone would be more appropriate IMO.


[Modifié le 2017-07-01 21:29 GMT]

[Modifié le 2017-07-01 21:36 GMT]

[Modifié le 2017-07-01 21:36 GMT]

[Modifié le 2017-07-01 21:41 GMT]


 

Michael Newton  Identity Verified
United States
Local time: 00:10
Member (2003)
Japanese to English
+ ...
Payment issues Jul 2, 2017

Jose Enrique has a point. I used to do business with Japanese clients who paid in 90 days. I later found out that the agencies receive payment from an end-client and then place the funds in an interest-bearing account (60 days; 90 days) before paying the translator. It was then that I realized that not only was I providing translation for them but was a source of funds for their zai-tech. Also, too many things can happen in a 90-day period: bankruptcy, administration, earthquakes and the like. A... See more
Jose Enrique has a point. I used to do business with Japanese clients who paid in 90 days. I later found out that the agencies receive payment from an end-client and then place the funds in an interest-bearing account (60 days; 90 days) before paying the translator. It was then that I realized that not only was I providing translation for them but was a source of funds for their zai-tech. Also, too many things can happen in a 90-day period: bankruptcy, administration, earthquakes and the like. Also, agencies which pay in 90 days have liquidity problems and are highly risky. The A 90-day pay period is a huge middle finger to the translator (excuse the vulgarity).Collapse


 

Mirko Mainardi  Identity Verified
Italy
Local time: 06:10
Member
English to Italian
Country-related? Jul 2, 2017

Michael Newton wrote:

Jose Enrique has a point. I used to do business with Japanese clients who paid in 90 days. I later found out that the agencies receive payment from an end-client and then place the funds in an interest-bearing account (60 days; 90 days) before paying the translator. It was then that I realized that not only was I providing translation for them but was a source of funds for their zai-tech. Also, too many things can happen in a 90-day period: bankruptcy, administration, earthquakes and the like. Also, agencies which pay in 90 days have liquidity problems and are highly risky. The A 90-day pay period is a huge middle finger to the translator (excuse the vulgarity).


Maybe it also is country-related to an extent? I often read colleagues saying, for instance, that many Italian agencies offer 90 or 60 days terms. Last time I was approached by an Italian agency, the agreement they sent me mentioned 90 days EOM + 10 further days for 'processing', which basically meant anything from 100 to 130 days... (and I believe they had a perfect score on the BB)


 

José Henrique Lamensdorf  Identity Verified
Brazil
Local time: 03:10
English to Portuguese
+ ...
In memoriam
Definitely country-related Jul 2, 2017

Mirko Mainardi wrote:

Maybe it also is country-related to an extent? I often read colleagues saying, for instance, that many Italian agencies offer 90 or 60 days terms. Last time I was approached by an Italian agency, the agreement they sent me mentioned 90 days EOM + 10 further days for 'processing', which basically meant anything from 100 to 130 days... (and I believe they had a perfect score on the BB)


In Brazil, interest rates are outrageously high, reaching figures like 15% per MONTH (sic!).

AFAIK in Argentina it is even worse (i.e. higher). I had an offer from a translation agency there, saying that they didn't care much about high rates, as long as I didn't mind getting paid in 60 days after month-end.

From across the Atlantic, I get the impression that two European peninsulæ - viz. Italia and Iberia - feature mostly under-capitalized translation agencies, whose core business equation considers paying vendors at least 60, an often 120 days after they have received the services.

I see too many translation agencies worldwide operating on this business model... short-term accounts receivable. long-term accounts payable. They don't have to know much about translation, just the basics to sell such services. So they live on the interim cash they receive from clients, and pay their translators from what they receive for the NEXT job. If demand declines, they'll be in trouble.

If you examine a number of Blue Board records, you'll see many translations agencies that started well, grew big, and suddenly "went rogue", as they became unable to pay their translators after their business volume grew beyond a certain threshold.

This is what led me to a decision taken a few years ago, and which caused me no regrets whatsoever. I did away with all urgency surcharges (unless statutory, set by Brazilian law on sworn translations). Urgency surcharges contributed more to wreaking havoc in my schedule that to my income. Ever since, I have been prioritizing jobs on shortest payment term getting served first. Quick-paying clients can take my availability for granted; those who pay later than two weeks after delivery might have to wait if I'm in high demand.


 

Robert Forstag  Identity Verified
United States
Local time: 00:10
Member (2003)
Spanish to English
+ ...
Further observations re payment periods of 60+ days Jul 3, 2017

1.
As is evident in the original post of this thread, part of the reason companies get away with imposing such terms is that they can usually rely on their regular contractors not raising too much of a fuss if payment is delayed (i.e., beyond the already long term that they have stipulated). The more dependent the freelancer is on such an agency, the less likely he or she will complain - and thereby risk losing the client. And those who complain too much are typically replaced by more plia
... See more
1.
As is evident in the original post of this thread, part of the reason companies get away with imposing such terms is that they can usually rely on their regular contractors not raising too much of a fuss if payment is delayed (i.e., beyond the already long term that they have stipulated). The more dependent the freelancer is on such an agency, the less likely he or she will complain - and thereby risk losing the client. And those who complain too much are typically replaced by more pliable contractors.

2.
The above implies that agencies dictating payment terms of 60+ days see part of the value of translators in their uncomplaining acceptance of such terms (and in the arbitrary extension of those terms). My guess is that, within certain practical limits, such agencies would choose a somewhat less experienced and less skilled translator who is willing to play their game than one with greater experience and skills who insists on more reasonable payment terms.

3.
And of course, implied in a number of the posts in this thread is the grim reality that, if problems do arise under such payment terms, the translator who has already waited 60, 90, or 120 days likely faces a wait of at least 30 days more before actually receiving payment (and this is something of a best-case scenario!). Part of the reason for this is the agency's likely financial difficulties. The other part is that translators who complain thereby ipso facto become personae non gratae and therefore the agency has no real motivation to placate them by quickly making payment of past due balances. As for threats of negative Blue Board ratings or legal action, such tactics might work, but it is also possible that the agency is past caring about the former, and it knows that the latter takes time.

So, in short, I agree with the consensus of this thread that acceptance of payment terms of 60 days or more involves significant risk.

[Edited at 2017-07-03 15:28 GMT]
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