(BOSTON, MA) – The language services industry experienced double-digit growth throughout the economic downturn. So why do some translation and interpreting companies increase revenue at breakneck speeds while others fail to gain momentum? A new report from market research firm Common Sense Advisory, “Language Service Provider Growth Factors,” explores this question.
The report, based on revenue data for 839 language service businesses over three fiscal year periods, shows that growth rates are influenced by an array of factors including location, attitude toward technology, acquisition strategies, and service expansion decisions.
“We noticed a clear correlation between the location of the company and their ability to achieve high rates of growth,” observed report lead analyst Nataly Kelly. “Companies based in Northern Europe, Eastern Europe, and Asia outperformed providers in other regions, including North America, perhaps due in part to the weakened state of the American economy.”
Key research findings include:
- Translation firms that embrace technology come out on top. Companies that are in favor of technology grow nearly three times as fast (63.94%) as companies that have mixed feelings about it (18.33%) and companies that are against it (18.73%).
- Mid-sized LSPs are growing faster than competitors. Suppliers with between 21 and 50 full-time employees (FTEs) reported a staggering growth rate of 157.33% for the three-year period from 2008 to 2010.
- Overall, Northern European firms report the fastest growth. Their average growth rate – a whopping 153.51% – is nearly double that of the next fastest-growing region, Eastern Europe (79.28%). Asia also displayed strong performance, with a growth rate of 39.75%, followed by North America (27.23%).
- Some countries in Eastern Europe also show impressive growth. Ukraine topped our list of the fastest-growing countries with a growth rate of 471.43%. Fellow Eastern European country Hungary was the nation with the second-highest rate of growth (141.67%).
“The good news is that a translation company’s attitude toward technology appears to shape its destiny, no matter where it is headquartered,” Kelly points out. “This is also positive for the end clients, since technology typically reduces costs and improves efficiency, making it possible for them to convert even more content that would otherwise never be translated.”
The report includes several takeaways and roadmaps for LSPs, including 10 suggestions for language service business growth and lessons from the world’s largest LSPs. For more about “Language Service Provider Growth Factors,” and the firm’s research, visit www.commonsenseadvisory.com.
About Common Sense Advisory
Common Sense Advisory, Inc. is an independent research and analysis firm specializing in the on- and offline operations driving business globalization, internationalization, localization, translation, and interpretation. Its research, consulting, and training help organizations improve the quality of their global business operations. For more information, visit: www.commonsenseadvisory.com or www.twitter.com/CSA_Research.