Bidding for Trouble: The Problem With Online Auctions

By Dagmar Dolatschko

Few of us language professionals have managed to escape this new and troubling phenomenon: online bidding for translation work. Why has price become such a major focus? Even the government has changed its bidding requirements from “the lowest qualified bidder” to “the lowest bidder”- the “qualified” part has been dropped lately.

The world is changing at the speed of light. Location doesn’t matter any more and there are well-educated and experienced translators all around the world with widely diverging costs of living. I do not mean to slight colleagues from countries where $0.04 cents per word affords them a good standard of living. They should be deriving the benefits of the globalization of our industry. The problem arises when clients and bid-lines then expect every translator to bid as low, at the risk of being outbid, and put out of business.

The core of the issue is that many clients don’t seem to care about quality, don’t understand what is entailed in translation, and don’t want to understand why a second linguist (and additional cost) is required for editing and proofing.

At my own agency, we had our first wake-up call two years ago when a high-tech client demanded our participation in an “online auction” where the lowest bidder wins. The process was so disheartening that my colleagues and I were speechless as we watched the numbers going down, graphically supported by online charts that showed the bidders and their pricing in comparison to each other.

In the meantime, many outsourcers are using the new online bidding forums such as ProZ.com, Babelport.org, Translatorplanet.com or Translatorsbase.com. And then there is GSA Advantage, for those who have worked hard to obtain federal supply schedule vendor status only to have to engage in online bidding and keep losing business to the lowest bidder – qualified or not.

I came across an interesting blog by the founder of Babelport.org, Christian Hansel, stating that he had actually considered introducing minimum prices for postings to stop the price dumping. He, too, hopes that outsourcers and clients will learn from their mistakes and understand that a $0.02-per-word translation is worth just that. He also makes the point that any businessperson in his right mind wouldn’t buy the cheapest legal or medical services available, but would instead value the professional’s experience and reputation.

It must be said, of course, that services in other professions – such as architecture, consulting, and software engineering – may sometimes be purchased at below-market pricing, and one may occasionally get lucky with a talented novice. Still, as Hansel says, the contractors – that is, professional linguists and translation service providers such as ourselves – need to fight the price-dumping battle ourselves and continue to educate our clients.

Low-cost language service providers are able to stay in business (some only for a short time), largely due to their bypassing of the editing and proofreading functions – or using “cheap” edits/proofs carried out by a native English speaker or a multilingual language “wizard,” working both into-English and into-foreign.

What can we do as a professional community to ensure that our line of work is recognized properly, achieving status similar to that of accountants or medical professionals? In my view, there are three key areas:

Client education

Besides using our own communication skills to educate clients about the differences in translation quality and the various quality assurance steps (editing, and then proofreading by additional linguists), we can point them to a professionally presented little booklet called Getting it Right, published by the ATA. This publication is available online at http://www.atanet.org/Getting_it_right.pdf.

Translator education

Translators need to understand that there is and should be a pricing difference when working with an agency and when working with a direct client. Mentoring programs should focus not only on the technicalities of translation, but also on the business side, including issues concerning proper pricing. Translators are doing themselves a disservice if they undervalue their work (especially to direct clients), and in turn cause downward price pressure to other professionals.

Agency education

This is a free market economy and I don’t want to propose price fixing. Yet, agencies who feel pressured to make the sale need to be aware of competitive pricing and should know that they often hurt themselves in the process when they “spoil”their clients. The low-margin, fly-by-night, online translation outfit that manages projects by price alone using online bidding portals has its place. But the output will be commensurate with the input.

We have to do our part to educate our clients about why quality matters. We have to educate new translators to ask a fair price and encourage them to negotiate and also educate their clients in turn. And as agency owners, we should show some pride in our profession and stick to our quality commitment. Underbidding by extreme percentages and letting translators “fight it out” in online bids is only creating artificially low pricing that confuses clients and hurts our profession as a whole.

If we can establish personal contact, be it only over the phone, often the transaction can be brought back to a human interaction, where we have a chance to bring the focus back from price to precision.

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