Bulk discounts are a powerful way for companies to sell more of their products – often while still maintaining a fair margin. The concept is used in a variety of industries, from bikes to clothing, and from plants to light bulbs. Every now and then clients also pop up in the translation industry demanding that their vendors – translators in particular – apply a volume discount to their translations. However, if there is one concept that is not beneficial and shouldn’t be used in the translation industry, it is that of volume discounts. And here is why.
The power of volume discounts
Volume discounts are applied almost everywhere. Retailers and business to business companies alike are using volume discounts to sell more or to get rid of their latest stock. While selling with a volume discount in some cases is not very beneficial to the seller as it produces less profits than selling the units one by one against the full price, they often still maintain a fair margin. Furthermore, in many cases it is quite easy to produce certain goods in bulk for lower prices per unit. While setting up the production process can be quite an expensive task, after the initial configuration the price for producing additional units decreases significantly. Apart from that sellers are using volume discounts to decrease their stock to make room for new products or to lower their inventory costs. In the end, customers have come to expect volume discounts. Some even wait until the sales season gets started to buy goods in bulk for ridiculous prices, not to mention Black Friday and Cyber Monday, famous for consumers who crave massive discounts.
Volume discounts in the translation industry
So the concept of volume discounts has found a treasured place in the hearts and minds of many consumers and people in business alike. Maybe that explains why some translation agencies are craving volume discounts when they start to coopt professionals in the translation industry. While it might be more difficult to ask an interpreter for a volume discount (‘Can you offer me a discount when you interpret more than ten hours in court please?’) there are various agencies who dare to ask. Some of them ask bluntly, while others use a more discrete means of getting the discount they want. Whatever their reasons might be, the fact is that those asking for bulk discounts see translations as a mere commodity, and translators as vendors that can contribute to their bottom line by invoicing less in return for more work. Apart from the fact that those asking for volume discounts show less respect for translators, their demands for lower rates also makes clear that they ultimately do not understand the profession of a translator, and the pricing mechanism in the translation industry.
Translation is not a mass production process
It might sound attractive: clients promising huge jobs coming your way if you decide to lower your word price by a cent or more. In the end we are all working for our living and more jobs mean more earnings, don’t they?
Yet a bulk discount and the translation industry are two incompatible concepts. While a bulk discount might be appropriate for a soccer ball or a T shirt, it does not do justice to translators who are working all day long to deliver unique translations. Translating is not a mass production process but a unique task in which every sentence and every word should be thoroughly considered because a mistranslation can have huge consequences. In many instances, no two tasks are the same. So while offering a big job might sound attractive to both clients and translators, every single word should be considered. Translating a big text is not easier than a small text. Quite the contrary. Translators therefore do not benefit from a time gain or lower ‘production’ costs. They do not have a higher margin when translating bigger jobs. Lowering their pricing is only beneficial to the client, but not to the translator.
Apart from that, thoughts on what a big job entails are changing. While a couple of years ago a job of 6,000 words was a big job, nowadays, many people in the industry are talking about jobs of 2,000 words as a ‘big jobs’. That results in lower word counts for which a volume discount is demanded, therefore only adding pace to the race to the bottom.
Thoughtful thinking about the concept also makes it a bit ridiculous. Imagine one agrees on a word price of €0.11 for jobs below 4,000 words and a 10% discount on larger jobs. While s/he will invoice €440 for a 4,000 word job, applying the discount to a 4,100 word job will result in an invoice of €405.
Applying bulk discounts on translations actually makes a translation cheaper than it should be. While rates have been under pressure for a long time now, the concept of volume discounts is only adding to that. Clients seeing translation as a mass product could best take a look at Google Translate. It is the only mass production translator that can work cheaper and faster than any human translator.