Translation Industry in Russia
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Russian LSPs annual increase in revenue 2009 – 38.5%2010 - 58%
> Trumps >
Global market growth rate of 7.4%
Gree.. owth is Good
GDP 2011
2.7%
1.1%
4.3%
1.8%0.8%
Sou
rce:
CIA
Worl
d F
act
book
Sou
rce:
Com
mon
Sen
se
Ad
viso
ry p
rese
nte
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FR
201
1
Yes, we
can!
Rates climbed in 2011Source: mozgorilla.com
2010 2011
RU Inflation (services) 8.1%
RU inflation (services) 8.7%
But higher tier contracts are under pressure.
Metal export duty 10% cut
Cigarettes 30%
Pork – 15% within the quota;
Dairy – 5%;Wine – 7,5%
Pharma – 5-7,5%
Cultivators 5-10%
Planes – 7,5% -12,5% over 7 years
Mobile phones 5%
Cars 5-10% over 7 years;Trucks 10-20% over 3 yearsOil & Gas
= no change
Source: Kommersant.ru
WTO deal highlights
Maturity through info exchange
1. Gov. spending up in public tenders 2. Entry to WTO to boost imports over
3+ years3. Rates go up, taxes still
comparatively low4. Market matures (in its teens atm)5. More Ru LSPs looking for anchors in
the EU6. MT raises its ugly head 7. Enterprises recover after Putin’s
reelection8. Business costs to grow (legality
pressure)
The Wind is Favorable
mostly
Opportunities
Challenges
LISA: 2008 = $250-300 mln, growing 15%
CSA: 2009 = 540 mln, 2011 Eastern Europe = $900 mln (2.84% of $31.4 bn global market)
Local LSP estimates for 2011: conservative $200, optimistic $400 mln
Russia has a lot catching up to do
RU market size:
{Who makes money in translation. And how?
The competition
CSA list 2011 report, 2010 data: ABBYY LS - $9.3 mln ($9.8 mln)
powerful software mother company, strong gov. presence
Logrus Group – $9.2 mln ($10.5 mln)
localization pioneer, famous for MS Windows project, currently has substantial US operations
Janus Worldwide – $8.19 mlnEnterprise-scale localization, started with SAP localization, currently Sochi-2014 Winter Olympics official provider
EGO Translating – $7.82 mln ($10 mln)
Established before competition, strong domestic market (St. Pete), early sales team
Neotech – $5.55 mlnEarly enterprise-scale technical translations (including oil&gas, automotive)
Palex – $2.39 mln ($2,85 mln)Large-scale projects for Samsung and Xerox
AG.Translate – $2.43 mlnMilitary, aviation
Not listed by CSA (2011 data) Translink - $8 mln
gov., military
Transtech – 10+ mln (estimate)military, technical, EGO spin-off
Megatext - $3 mlnNeotech-affiliate retail chain
Traktat - $3.5 mlnStrong retail chain complements b2b
TLS - $3-5 mln (estimate) ROID - $3.5-4. mln (estimate) AKM Translations - $2.7 mln Exprimo – $2.1 mln Rperevod - $2 mln Mark business translations
and others..
National Market Leaders
{
Regional leaders
Mars
Moscow
St.Pete
The Millionniki, 10 more hubs above 1 million inhabitants, house well-established LSPs with strong local ties and average revenues around $1-1.5 mln, staffing 20-40 employees. Examples: All Correct (39), Prima Vista (27), Avanta Translating (23), Aum (32)
Alpha Centauri
Life outside St. Petersburg and Moscow?
ABBYY $9,32 mln / 83 emp = $122 kLogrus $9,2 mln / 150 emp = $61kJanus $8,19 mln / 136 = $60kEGO $7,82 mln / 178 = $43kNeotech 5,55 / 112 = $50k ($57 w/ Megatext)Translink $8 / 123 = $65kPalex $2,85 / 63 = $45kAKM Translations $2,7 / 35 = $77k
Revenues per employee
Traktat
Timeline
1988 1990 1992 1994 1996
1998 2000 2002 2004
2006 2008 2008 2010 2012
FonetixNeotech
EGO
Mark BT
Logrus
Star Spb
Janus
ROID
TLS
ABBYY LS
Palex
Translink
AG Translate
MTA RTC
AKM
Trans-tech
Nothing new?
Source: translationrating.ru
Wild East Years
Bust! goes the economy
Sum total of identified market leader revenues in the list above – under $100 mln
CSA & LISA estimates at $540 and $300 mln
Huh? Where is the money?
Global MLV presence unaccounted: Lionbridge, SDL, Masterword, Star Group, WeLocalize, Translation.com, Merril Brink.
Specialized and subcontractor agencies not part of active community. Examples: Multilize, Techinput, etc.
More players: web search returns 1000+ LSP websites, and don’t discount the freelancers.
Large in-house translation departments in major companies (salaries are low, outsourcers expensive).
Invisible competition
Attractive Sectors
1. Primary exports: Oil & Gas, Metals2. Infrastructure: Energy, Chemical
Industry, Industrial Equipment, Road & Rail
3. Medical & Life Science4. Government & Public Sector5. Localization6. Also in the news: On-site interpreting
based on LSP CEOs’ opinions
maybe
Oil & Gas – highlights
Ph
oto
: S
akh
ali
n
en
erg
y
Medical - highlights
Ph
oto
: n
nm
.ru
Infrastructure - highlights
Ph
oto
: sa
mara
life
.com
Since 2009 all translations for state bodies must be sourced via tenders.
They overdo it: If all contractors are allowed to participate prices deteriorate to 0.025 cents/word.Often at the expense of quality.
The better priced tenders are NOT transparent!
The Trouble with Tenders
Russian is spoken in:Azerbaijan, Belarus, Estonia, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Moldova, Russia, Ukraine, and Uzbekistan.
expansion: Russia is an entry point tomore markets
{Local legal entity required;Administrative and financial accounting have never met each other;To sell well locally you need to enter the markets less transparent.
Barriers
“Russia is one of the top-10 markets for us... closer to the 2nd part of top-10”.
Istvan Lengyel, Kilgray
Realistic prices: Minimal 350 RUR per page Average 650 RUR per page High quality 900 RUR per page
LSP Rates
0.046c per word 0.085c per word0.118c per word
But the costs
are lower too!
Where to start?
Rating Agency Expert - Top 400 earnershttp://www.raexpert.ru/ratings/expert400/2011/table1/
Forbes 200 non-publicly traded http://www.forbes.ru/rating/ekonomika-package/kompanii/73640-krupneishie-nepublichnye-kompanii#pages-1
Telesales & CRM data
For the links, please download my [email protected]
Vendor management 101
Staff translator average salaries by region• Moscow GMT+4 1100
eur• St. Petersburg GMT+4 700
eur• Ufa GMT+6 580
eur• Nizhniy Novgorod GMT+4 550 eur• Voronezh GMT+4 420 eur• Kiev GMT+3 380
eur• Minsk GMT+3 372
eur
Sou
rce:
rab
ota
.yan
dex.
ru
Freelancer rates don’t
depend on location
M&A market not developed.
2008. Renova holding bought PROMT 2007-2011. ABBYY + perevedem.ru 2010. Traktat + AGI Triple
Acquiring a local LSP?
Social networking on: facebook.com, livejournal.com, vk.com
Forums: trworkshop.net, facebook.com/msk.tfr
Industry news portal: mozgorilla.com
The community
Check it
out!
translationrating.ruSolid data on Russian language agencies, plus a ranking based on LSP votes.
For first-hand experience visit
Translation Forum Russia 2012
Kazan, 28-30 September. Tconference.ru +421(917)[email protected]@constanch
Common Sense Advisory: Language Services Market 2011
LISA: Globalization Services in Russia 2008 report Libor Safar & Katerina Gasova: Cracking the
Russian Market 2009 (Multilingual) Nataly Kelly: Translation business rises in Eastern
Europe 2009 (Multilingual)
Interviews:ABBYY LS, AKM Translations, All Correct LS, Dialect City, EGO Translating, Janus, Kilgray, Logrus Group, Neotech, Russian Translation Company, TLS Service, Traktat, Translink, XTRFSources & Further
reading
