Researched and written by Beata Janaszkiewicz-Cavalcanti and Laszlo K. Varga.
The market for freelance translators
The language industry – evaluated at about USD 70 billion in the 2024 edition of the Nimdzi 100 – is a world of outsourcing with multiple levels of value created. A typical supply chain of a language services buyer (LSB) could be 3-4 levels deep, where the language work itself is done by freelancers (FRLs, also dubbed contracted language professionals, CLPs). Value creation is cascaded up through local (single language vendors, SLV), regional (RLV), and global (MLV) language service providers (LSP).
Source: The General Theory of the Translation Company
On each level of the supply chain, interconnected questions arise:
- When adding new languages or locales to the scope and offering, what are the key decision-making criteria for the outsourcing strategy?
- More comprehensively, should an LSP or an LSB buy services from LSPs, or directly from freelancers?
- What are the business implications in terms of cost, timeliness, quality, request fulfillment, and engagement?
- What are the ways of ensuring that existing freelance rates are up-to-date with market dynamics?
The underlying data point to support the answers to all these questions is the “right” per word rate for the work of a freelancer. “Right” is an ambiguous word, as it depends on perspectives, objectives, and context, and gives rise to heated debates in many forums. Ultimately, the tug-of-war is between freelancers who want to make a living from the valuable language work they perform, and buyers on any level of the food chain who want to make sure their outsourcing costs (also called external spends, the single largest cost item in any language operation) are optimal – i.e., the business is (predictably) profitable, the supply chain of language talent is transparent, predictable, scalable, and always-on to handle varying and sometimes unpredictable demand from customers.
This article explores the intricacies of determining the “right” per-word rates when working with or planning to work with freelancers for the purpose of translation.
TL;DR
There is no “single right translation rate” for every freelance contract and engagement. Demand is fragmented, tasks are various, content is diverse, collaboration types vary, and the supply side is globalized.
Even though translation has become a global commodity, freelancers create their rate offers in diverse and complex ways, taking into account factors such as their known or assumed value, specialization, experience, buyer type, the buyer’s brand, volumes, discounts, timelines, and frequency of work.
Buyers of translations from freelancers are both direct (enterprises) and indirect (LSPs) who have different objectives, budgets, tools, volumes, and depth of engagement and use various practices to gather data for making decisions about translation buy rates.
The per-word costs achievable by buyers who use freelance translators vary greatly and largely depend on their purchasing and negotiating power.
As with all imperfect markets, the level of information asymmetry between supply and demand is a key factor in the final price, and prices are never final.
Publicly available freelance databases such as Proz.com are both good and bad guidelines. They are helpful in understanding how the typical rates on offer compare across languages, expertise, experience, and service, but should not be taken at face value as actors on both sides of the table are prepared to negotiate.
This has been a preview. The full report can be accessed online by Nimdzi Partners.
The article was co-written by Beata Janaszkiewicz-Cavalcanti.
The article was researched and co-written by Nimdzi's Lead Researcher and Analyst, Laszlo K. Varga.
