The myth of the non-paying client December 10, 2012
Posted by Jill (@bonnjill) in Business practices.trackback
Catherine Christaki (@LinguaGreca) from Adventures in Freelance Translating has an interesting blog post about the results from the Common Sense Advisory survey of freelance translators. Her post was published on the 7th, but I am just catching up with my RSS reader today after a weekend off hosting my cousin from Florida. I found the results of the survey very interesting. Catherine was astounded that so many translators (65.3%) reported never having had to deal with a non-paying client. I don’t find that such a stretch. I think there are way more good agencies than bad agencies out there. It’s just that you never hear about all the clients that DO pay. Translators are more likely to complain about the few black sheep they encounter. I worked in the industry for 16 years before encountering my non-payer. Luckily I also knew to cut them off after the second job request, so they only ended up not paying $60 instead of several thousand dollars. In terms of numbers, that was several hundred paying clients (even if some of them were slow payers) against a single non-paying client. As I have preached time and again (and Catherine also advises), it really helps to do some due diligence on a new client before working for them. I agreed to work for the non-paying client because I was driving in my car, they said a colleague had recommended me, and they were in a terrible bind. Looking back, I should have made them wait until I could go home and check them out. But since it was such a small job I took the risk and accepted the job. If it had been a larger job I would have made them wait.
So the moral of this story is that there truly are many more good agencies than bad out there, and the numbers back this up. 65.3% of the 3,165 translators who took the survey prove this. Be sure to read Catherine’s blog post as well as click the link to the survey she has included in her post.
Musings from an overworked translator 
It is not a myth, Jill. I wish it were.
Maybe you were very conservative, or very lucky, or possibly both.
But most freelancers who extend credit as freelancers to people they don’t know will eventually get stiffed. It is better to build this possibility into your business model because it is only a matter of time before something like that is likely to happen.
I have been stiffed about 5 or six times over the last 25 years, which is probably better than average, the largest amount was three thousand dollars by an agency that declared bankruptcy. You can get stiffed both by an agency or by a direct client, it does not really make that much of a difference.
I would question the methodology used for that survey. How long have these translators been in business? Are they really freelance translators?
This number (65% of translators who never, ever lost any money to a non-payer) makes me trust Common Sense Advisory (Common Nonsense Advisory?) even less. I don’t know what it is, but something is wrong with this number. The only way to avoid the danger of a non-payer is to always work only for people who you know very well, or to always make clients you don’t know pay in advance, which is simply not a practical model for most people. It would be hard to make money like that, which is why every business sometime has to take calculated risks.
It is not just translators who lose money in this manner, every business that has to send an invoice and than wait to get paid runs the risk of never seeing the money. You can and should try to minimize the risk as much as possible, but you can’t eliminate it.
That 65% of translators completely eliminated this risk is simply nonsense.
These are just simple facts of life, all you have to do is ask around.
Steve, I belong to that 65%.
I’ve been in business for over 20 years and, yes, I really am a freelance translator.
Like Jill and Catherine I do my due diligence before I take on a new client (direct or agency). I don’t agree to new projects with them when I’m out and about and definitely not “while driving” (!) so that I can get home and check them out calmly.
But you’re right, I haven’t completely eliminated the risk and I know that I may come a cropper one day
“So the moral of this story is that there truly are many more good agencies than bad out there, and the numbers back this up. 65.3% of the 3,165 translators who took the survey prove this.”
Sure, a bit less than 2/3 of the translators who took the survey prove that there are more good agencies than bad ones out there. But at the same time a bit more than 1/3 of them confirms that there are bad ones with whom they had bad experiences.
Now, the question is: How are we going to make sure which ones are good and which one are bad?
The agency that run by Steve Vitek is definitely a good one, because he knows how to treat translation colleagues fairly. How about the ones who we actually do not know at all and who contact us through some cyber-streetwalking (proZtitution) sites? How can we be sure that we won’t fall into hands of the other 1/3 of agencies?
I guess, translators shall be more active, like Wendell Ricketts suggests in an interview with him: http://provenwrite.com/articles-interviews/moving-beyond-%E2%80%9Cgarbage-in-garbage-out%E2%80%9D-translations-a-conversation-with-wendell-ricketts/ – Moving Beyond “Garbage In-Garbage Out” Translations.
That is, we shall be choosers, instead of begging arround (cf. Seth Godin’s blog post “Beggars can’t be choosers” at http://sethgodin.typepad.com/seths_blog/2012/12/beggars-cant-be-choosers.html).
With so much information and tips available online nowadays, the possibility to work for a non-payer is much slimmer than it was 5-10 years ago. The responsibility falls 100% on the translator, the cases where it’s just pure bad luck and the non-payer is a great paying company are just a handful. All the signs were there for 1 of my non-payers; website contained no information (address, phone etc.) and they had all kinds of “fishy” businesses going on under the same name. But of course, I discovered all that after they stopped paying me (they paid for the first few jobs). So, it was my fault. If I had researched them beforehand, I would have avoided the trouble.
2 of my other non-payers were fine with payments for the first few years and they were both regular clients (fairly big monthly wordcounts). But both were slow with payments, needed a lot of reminders and their accountants were hard to reach. More signs that I should have paid attention to…
My main problem is that all my agency clients are abroad. It’s not worth it for me to go after them, legally or physically (visiting them). If they were anywhere in Greece, it would have been a different issue. A Greek advertising company manager owed me $15 many years back and I kept calling him and at the end I told him that the market in Heraklion (my home town) is small and it would be very easy for me to tell people what a cheapskate he is. He paid me the same day (left an envelope outside my house). Another example (nothing to do with translation) was when I was a student and worked at Burger King in Cambridge. They owed me 2 months worth of money (a lot when you’re a student), so I took with me two large and menacing-looking friends and they paid me right away. I wish it were that easy with clients abroad too…
All my first time direct clients pay in advance or go somewhere else. Period. Agencies are a different matter. And there’s no ”completely eliminated risk”, Steve. They just haven’t been stung YET.
Well, my direct clients are mostly patent law firms. If I insist on being paid first, 100% of them will go bye-bye.
Maybe the difference between Jill’s and Emma’s and my way of doing business is that their model is very safe and mine is quite risky.
The safe model is to only work for a few customers that you know you can trust and have everybody else prepay.
But I work for more than 30 customers most years and I only make private individuals prepay.
However, my model makes it possible to relatively easily replace lost customers and find customers paying higher rates. In a “recession”, such as the one we have had the pleasure to deal with for the last 5 years, the safer model can become the riskier one if a few of your trusted customers for some reason disappear, usually because they found cheaper labor, while the riskier model can be paradoxically safer in the long run if I can relatively easily replace lost business by business from new customers, preferably customers paying higher rates.
So it is quite possible that the riskier model is at the same time the safer model in the long term, in spite of its risks, because it is more flexible.
“They owed me 2 months worth of money (a lot when you’re a student), so I took with me two large and menacing-looking friends and they paid me right away. I wish it were that easy with clients abroad too…”
The equivalent of two large, menacing-looking friends could be to threaten a non-payer to write a blog post about the bad experience that a translator had with a non-payer.
I wonder if something like that has ever been done.
“The equivalent of two large, menacing-looking friends could be to threaten a non-payer to write a blog post about the bad experience that a translator had with a non-payer.”
Steve, do you think, it would work that way? As you wrote above, you were stiffed 5 or 6 times overthe past 25 years. Have you written any blog post about the bad experiences you had with those non-payers with names? I guess, no. While I am not interested in the reasons why, I would rather ask you how you reduce the risks in doing business with people, about whom you actually don’t know anything or just a little bit.
As I mentioned some time ago, there’s a Chinese, “You know them by names, you recognize them by faces, but you can never be sure of what’s going on in their minds.” Just think about the figure of 34.7% of translators who had bad experiences. That would be one out of every three who has to experience losing the hard earned money. Isn’t it horrible? And why it happens again and again?
There is another Chinese saying, “Knowing that they are no partners, one goes along with them for company due to the circumstances (明知不是伴，路急且相隨).” This happens to most of people. That’s why it works with a “ponzi scheme” or a scheme of “rob-Peter-to-pay-Paul.” Even if Paul knew how the scheme is supposed to work, he would probably be happy that he is not the Peter.
In many such cases of translators gotten f***ed, you can find out that there were signs of a scheme. But people just don’t believe that they could be that unlucky as to become the Peter.
Lucky ones tell us that we shall think positive and act positive. But, while the odds of a Russian roulette is definitely 1/6, the odds for translators is about 1/3. We have a higher risk! Shall we take it as a normal occupational hazard and be careless in our transactions? Or maybe take the crooks for company and keep a lifelong pledge of omertà even when we got hurt?
Although I haven’t yet gotten banged by any client, I wish all translators, including me, could have some more big, menace-looking or some more formidable blogger friends.
@Wenjer
No, I never wrote a blog post in which I would identify a non-payer. That is why I am asking whether it has been done by somebody.
But I think that the implied threat that translator could do something like that works to our advantage. It is the equivalent of “speaking softly and carrying a big stick” (I wonder if there is a Chinese proverb that says the same thing, more or less).
The problem with the big stick is, if you hit somebody with it, it hits you too, that’s why I would be very reluctant to use it.
I have not had non-payers either, and I’ve been freelancing for 12 years. The way the contact came about makes a difference. Most of my clients are word-of-mouth contacts from other colleagues or clients, so there is some built-in accountability there. Recently I thought I had encountered my first non-payer for an invoice of $25. Lo and behold, I received the check 6 mos. late, but I received it.
Great post, Jill! The 65% figure seems realistic to me too; I think that if you use Payment Practices every single time you work for a new agency, you really minimize your risk of not getting paid. The only non-paying agency I’ve ever worked for (in 10 years of freelancing) came as a referral from a colleague who had worked for them for years, so I see that as a random incident, not something I could have prevented. But here’s what really perplexes me: when colleagues post a “Has anyone ever worked for XYZ agency, because I’m chasing them for $2,000?” message to an industry listserve– at least 8 times out of 10, that agency is reported on Payment Practices as a known non-payer. I think I’m a fairly compassionate person, but I have almost no sympathy for someone who will not spend $20 on a PP membership, then extends that type of credit to a new client.
Thanks Jill and everyone else. My case of a non-payer was a client who paid with no problems for several years, so I did not think much of it when they were late with paying the last invoice. I did my due diligence reminders, and was stunned that I did not hear back. I ended up contacting a collection service, but to no avail, since the company went bankrupt. I did not see any signs of this beforehand and do not know how I could have prevented it.