It’s safe to say that translation and localization services have always been affected by fluctuations in the financial markets to some extent, since they support myriad sectors and industries, and mirror the trends happening in those areas. But perhaps never more so than in the pandemic era, where no industry has gone untouched. We’ve seen plummeting demand in tourism and travel translation, skyrocketing need for covid-related health messaging, and a marked increase in remote simultaneous interpreting.
Bearing in mind that market volatility is far from over, and will always exist to a lesser or greater degree, what can providers of translation and localization services do to prepare? How best can you mitigate any damaging effects these changes could have? And capitalize on any shifts in your favor?
Review your business
Start by taking a long, hard look at your business. Review your clients, project types, areas of specialism, and internal processes. Ask yourself questions like:
- Does more than 40% of my revenue come from one client?
- How many different countries are my clients based in?
- What sectors do my clients work in?
- What services do I offer my clients?
- What are my most profitable projects, services, clients, and language combinations?
- How future-proof are each of the services I provide?
- How future-proof are each of my clients, and the sectors they work in?
- What percentage of leads convert into sales?
- Could I streamline certain processes in my business?
Answering these questions will give you a clear idea of whether you’re too reliant on any client, market, sector, service, or language combination. And this is important to know. Because being too reliant on any one of these opens you up to risk. Risk of currency fluctuations eating up your earnings, risk of a particular sector taking a nosedive, or risk of a client going bust or switching providers. And if you assess how future-proof the different services you provide and sectors you work in are, you’ll be able to identify which areas you should prioritize, and perhaps see new opportunities for growth.
Create a robust, adaptable strategy
After a thorough review, the next natural step is to create a business strategy – a roadmap setting out where to go, and how to get there.
You should include your overall mission and your SMART (specific, measurable, achievable, realistic, and time-bound) goals, together with the actions that will help you achieve them.
For instance, you might have something along these lines:
- To become Turkey’s leading software localization provider.
- Increase the proportion of revenue from software localization by 30% by the end of 2022
- Gain three new software localization clients by the end of the third financial quarter, of 2022
- Improve profitability on software localization projects by 10% by the end of 2022
- Increase order value from two software localization clients by 20% by the end of 2022
- Approach 20 software localization leads by the end of the first quarter, 20 more by the end of the second quarter, and 30 more by the end of the third quarter
- Implement automation of vendor selection in software localization projects, where appropriate, to save project manager time and improve productivity
- Run client success meetings with software localization clients to identify where we can improve
- Incentivize account or client success managers to upsell clients to a larger software localization package
- Launch a series of marketing campaigns to promote software localization services
Though a strategy is a great starting point, it shouldn’t be set in stone. Just like your business as a whole, it needs to be flexible and adaptable, ready to react to changes as they arise, both positive and negative. Treat it as a living document.
Three key approaches to adopt
Your strategy should be unique to your business. That said, these three approaches can help all businesses whether any storm is on the horizon.
1. Diversify, diversify, diversify
Diversification reduces risk. Making sure all your eggs aren’t in one basket is an excellent way of protecting yourself from market volatility and any other changes outside of your control.
Diversify your client base, markets, and specialisms. Make sure that you’re not too reliant on anyone – or two – clients, and that you have a range of types of clients from different countries. Maintaining geographic diversity can help protect you against currency fluctuations and changes to trade relationships. And working across different verticals or areas of specialism will mean you shouldn’t be as severely affected if one area, such as events and hospitality or travel and tourism, takes a hit.
For example, say you’re a UK LSP working only with a couple of French clients selling B2C products around the UK. Your clients may have found themselves in a sticky spot with post-Brexit paperwork and transport woes. Some may have reduced their translation orders. Some may have even gone under. And the knock-on effect on your business would likely have been catastrophic. If, however, you also had clients based in the UK and elsewhere in the world, these changes would have had a much smaller impact on your business.
2. Keep your best clients happy
Since it’s more expensive to gain a new client than to keep a current one, it makes sense to prioritize client retention. In fact, we could go beyond that and say that you need to focus on your best clients, those with a high customer lifetime value (CLV).
This might involve investing more resources in account management or customer success to make sure you’re nurturing client relationships, surveying your clients to find out what’s going well and what’s not, and encouraging your team to be proactive, keeping up to date with client challenges and needs so they can spot opportunities.
3. Automate repetitive tasks
Automation is key to staying competitive. Clearly, it saves your team time and saves you money. But it also allows you to focus on value-add activities, like keeping your clients happy. Or perhaps vendor sourcing, to recruit the very best talent for each project.
And since most people don’t enjoy repetitive tasks such as manually creating projects, issuing invoices, and purchase orders, automation is likely to improve staff satisfaction too.