The ATC UK ( https://atc.org.uk/)survey report carried out in collaboration with Nimdzi Insights reflects the current market situation of the language service industry. It captures the major companies at play and different operational variables affecting the market which creates a better view of the future. This survey of present and past market conditions helps highlight techniques that will allow the language service industry to remain relevant.
The GBP1.35 billion revenues generated from the UK language service companies (LSC) in 2018 makes it the second-largest globally. This outstanding growth can be credited to mergers, growth of the interpretation market and integration of technology into the industry. Despite a slower growth prediction for 2018, these key decisions resulted in a complete turnaround and a 13% revenue growth instead.
However, a slow-down is predicted to result from political uncertainty and market fluctuations for 2019. Therefore, to help the industry survive and respond to global trends, the analysis of 2015 to 2018 survey reports helps draw the following conclusions:
Summary of survey reports
- Geographical market: Geographical market for LSC shows that revenue generated from within the UK accounts for a bulk of the sum. Revenue from other EU countries follow closely, then the US and finally the rest of the world. Asia has the least market turnover. This indicates prospects for investments in other countries other than EU, UK, USA and Asia. Asia, however, is still at infancy with this industry.
- Revenue from industries: Financial service industry accounts for most of LSC revenue (23%), and the entertainment industry accounts for the least (1.2%). Progressive trends from 2015 to 2018 show a growing turnover from entertainment, and so growth is expected in the following years. However, high revenue companies appear to have the most investments in pharmaceutics and medical equipment companies. LSC with contracts in diverse industries poses lower risks and higher market profits. Therefore, rather than an investment in a high paying industry, diversification is advised.
- Client and staffing conditions: LSC has an average of 20 full-time employees out of which the sales department accounts for larger revenue turnover. Overall, the industry shows good client diversity which is also essential for lower market risks. In terms of managing risks, pursuing diversity rather than high paying clients is an impactful strategy. However, client retention affects eventual turnover as high client retention and long-term contract minimises losses and maximises profits. Unfortunately, only 12.5% of LSC get more than 75% of their revenue from long-term clients.
- Translation and localisation: Translation/localisation services account for 55% of the industry’s revenue, other complementary services account for 43%, with the remaining 2% for interpretation. In a highly competitive industry, a mix of translation/localising services and complimentary services reduce risks and results in higher revenue turnover. Pricing rates for specialised knowledge industries are usually above the average rates in the UK, Asian languages have the highest pricing rate in multimedia. However, care must be taken against negative price rate factors like the Brexit contract document review for the industry, Machine translation and competitive pressure.
Machine translation: Impact of Machine Translation in the industry cannot be neglected as an average of 26% of projects already use it. Its use is spread in the industry in varying degrees and in reaction to that, 67.74% of LSC agree to a need for MT post-editing