Profits will be lost in translation if you keep giving special discounts
The following question appeared in the 'Ask John' section of the Telegraph on 4th of July 2016.
Q: My grandson established a translation service, specialising in Portuguese and Spanish, three years ago and recently gained an accolade for his work. Some of his early customers offer him business which is not sufficiently profitable but, because they helped him to establish the business, he is reluctant to either refuse their custom or ask for increased and profitable rates of pay.
Other more profitable translation work, more demanding of his skills, still commands rates of pay below that which he feels he should have. Yet he is reluctant to increase his charges to these clients for fear of losing the business.
What words of advice do you have towards his goal of expansion and increased profitability, please?
John Timpson: Your grandson needs to realise that his talent for translation is not simply a hobby, it is his main source of income. To put his service on to a proper business footing, he has to put up his prices, but by how much? How do his rates compare with the competition? Does he charge by the hour or is it a rate for each job?
Few businesses last very long if they give every customer a special discount. Once he has settled on his new price list, he should put it into practice for every customer. He must get out of the habit of doing lots of special deals.
Even if his new pricing policy is communicated with care, some customers may take their business elsewhere, but, if your grandson is as good as you say he is, most will stay loyal, and new customers will be attracted by his reputation.
He has already proved that he can provide a popular translation service – it is now time for him to show that he can run a proper business.