Pricing Wars Among LSPs: How to Avoid Undercutting and Still Win Translation Deals

Business Coaching

ProfectaBDI | April 25, 2025

“We lost the deal—again. They went with the cheaper supplier.”

 

Sound familiar?

 

If you’re running an LSP, chances are you’ve heard this more times than you’d like to admit. The translation and localization industry has long been a competitive battlefield where price is the weapon of choice, and too many companies are slashing their rates just to survive.

 

But here’s the truth: undercutting your competitors doesn’t just hurt your bottom line. It has quietly been destroying the entire translation and localization industry for years, if not decades.

 

 

At Profecta BDI, we work closely with LSPs worldwide, helping them maintain long-term stability. And we’ve seen the same dangerous pattern: companies chasing deals by offering rock-bottom prices, only to find themselves overworked, underpaid, and stuck in a cycle that’s impossible to scale.

 

So how do you win translation deals without racing to the bottom?

 

Let’s dive in.

 

 

The Real Cost of Competing on Price

 

When LSPs compete on price alone, everyone loses. Clients get subpar results, translators get squeezed, and LSPs burn out.

 

We recently worked with a mid-sized translation company—let’s call them “LinguaNext”—that had been slashing prices to win contracts with large enterprise clients. Initially, it seemed like a success. Revenue went up. Projects rolled in. But within six months, they were overwhelmed, their profit margins evaporated, and their top linguists were leaving for better-paying gigs.

 

They weren’t growing—they were bleeding slowly.

 

LinguaNext’s story isn’t unique. In fact, it’s becoming the norm. But it doesn’t have to be this way.

 

 

The Mistake Most LSPs Make

 

 

The #1 mistake LSPs often make when selling their services is leading with price instead of value.

When you focus on being the “cheapest,” you communicate that your service is a commodity. Something that can be easily replaced. Something that isn’t unique.

This opens the door for clients to treat you like a vendor instead of a partner.

 

But the truth is, translation is not a commodity. It’s a high-impact, business-critical service that drives global growth, customer satisfaction, and brand equity.

And when it’s done poorly by the lowest bidder, the damage can be massive: lost customers, brand confusion, compliance issues, and even legal trouble.

So why are so many LSPs still selling based on price?

 

One of the common reasons is that they haven’t built a compelling value proposition.

 

 

Your Price Isn’t the Problem—Your Positioning Is

 

If you’re constantly being compared to low-cost competitors, it’s not just that your prices are too high—it’s that your offer isn’t communicating enough value.

This is where most LSPs fall short. They talk about word counts, turnaround times, and CAT tools. But clients don’t buy word counts—they buy outcomes.

They normally want to:

 

● Enter new markets faster

 

● Improve the global customer experience

 

● Ensure brand consistency across 20+ languages

 

● Meet regulatory requirements in every geography they’re in

 

●Scale without sacrificing quality

 

If your marketing or sales pitch don’t address these outcomes, you’re leaving money on the table—and opening the door for low-cost providers to swoop in.

 

 

The Solution: Create an Irresistible Offer

 

 

This is where we bring strategy inspired by Russell Brunson: the story, the offer, and the transformation.

 

● The story: Start by connecting with the client’s pain point. Don’t sell translation—sell the solution to their global growth challenges. Use storytelling to show how your services help companies avoid embarrassing translation errors—now especially caused by AI solutions or free machine translation tools, launch campaigns successfully in new markets, or cut onboarding time for new international customers.

 

● The offer: Package your services as a solution, not a line-item service. Consider bundling services like localization strategy consulting, transcreation, QA, and project management into a high-value offer. Add guarantees, support, or methodology that sets you apart.

 

● The transformation: Paint a picture of the “after” state. What does success look like for your client? A smooth product launch in 12 new countries? A 30% increase in international sales? Reduced customer support tickets due to better localized content?

 

When clients see the value of the transformation, they normally stop asking about price—and start asking, “When can we start?”

 

 

Repositioning Your LSP for Profitability

 

Here’s how top-performing LSPs are shifting away from pricing wars and embracing value-based sales:

 

🟣 Niche down: Specialize in a vertical (e.g., medical, legal, SaaS) where your expertise provides strategic value.

 

🟣 Build authority: Share case studies, client success stories, and thought leadership content to establish credibility.

 

🟣 Train your sales team: Teach them how to lead value-based discovery calls, not price discussions.

 

🟣 Use pricing tiers: Offer good/better/best packages to give clients choices without discounting.

 

🟣 Focus on ROI: Help clients calculate the cost of poor translation vs. the ROI of doing it right.

 

 

Stop Competing on Price—Start Winning on Value

 

The translation and localization industry has been at a crossroads for a while now. ELIS survey results for 2024 show a rather gloomy present and future. You can either:

 

● Keep playing the pricing game, hoping to outlast your competitors (spoiler: no one wins), or

 

● Step up, reposition your services, and charge what you’re truly worth.

 

At Profecta BDI, we help LSPs do exactly that. Through consulting, coaching, and tailored training, we guide you to build a scalable business that doesn’t rely on cutthroat pricing to survive.

 

If you’re tired of being undercut and want to finally start winning deals based on value—not discounts—let’s have a strategy talk.