My previous 3-post miniseries on rates and the Matrix (here, here, and here) had an amazing response from readers, especially from the awesome and supportive members of IAPTI and No Peanuts who helped the series go viral. So this post begins with a big-fat THANK YOU to my wonderful community of colleagues and friends that are committed to promoting ethical practices and fair rates.
You’ve probably already realized that, in that series, I’m trying to show you two things: 1) translation really doesn’t have to be cheap; and 2) that notion can be supported with actual numbers. Fortunately, shifting segments is easier than most people think and in response to the many e-mails and messages received, here’s the “how” and the math.
1. Market Research: There’s a lot of information available about rates online. Use the power of the internet.
2. Experimentation: I was able to steadily increase my rates on a per-project basis after Law School by way of better marketing and lots of experimentation. The experiment consisted of three parallel strategies. First, charging every new client higher than the last. Second, adjusting my price per inflation (this is important because I live in an emerging economy with elevated inflation rates). Third, as new clients willing to pay my new rates came in, I would drop older clients who were not willing to pay higher rates. This last part allowed me to transition from one market segment to another without starving in the process of finding specialty or “premium market” clients. In addition, better marketing means more end clients (aka, “direct clients”), which also translates into higher fees per project. But that’s a different story.
3. Math: True, lawyers are not great at math. In fact, many of us joke that if we had math skills, we’d have gone to accounting school instead. Be that as it may, figuring out the price you should be charging if you are working on a per-word basis is so simple even a lawyer can get it:
A = your expenses (i.e. how much you spend per month on an average month)
B = how many words you translate on an average day
C = how many days per month you are willing to work
D = A ÷ C = how much you need to make per day to cover monthly expenses
D ÷ B = how much you need to charge per word to reach that goal
Voilà! You have found your start-out rate. Try it out on your next new client and start increasing steadily from there. If you’re going to try this strategy, then you might want to keep three things in mind:
1. If nobody’s trying to get you to lower or negotiate your rates, then you’re probably charging too low.
2. At some point you will hit a ceiling beyond which nobody is willing to pay. Your goal is to find the most efficient number closest to that ceiling.
3. The European market and the American market handle different “premium” rates. I recently tried to charge a premium European rate to a US client and failed miserably. However, the experiment helped me find a premium standard for US clients that’s proven very effective as a baseline rate from which to push up.
I hope this post is helpful and look forward to hearing other ideas, formulas and recommendations from readers!