How do I raise my prices without losing my customers?
Raise them on new quotes first, give existing customers notice and a date, and say plainly why. Costs have gone up and you want to keep doing the work properly. You will likely lose a few price-sensitive customers. If the increase is right, the business usually ends up with fewer of the worst-paying jobs and more profit.
Start with new quotes
New customers only ever see the new price. Raising there first tests the number with no relationship at risk, and tells you quickly whether the market accepts it.
Give existing customers notice
A short, plain message with a date a month or two away. No long apology. Most regular customers expect prices to move; a surprise on an invoice is what damages trust, not the increase itself.
Expect to lose some, and check which
The customers who leave over a fair increase are usually the ones choosing on price alone. Losing a few of them often frees capacity for better-paying work. Watch whether you lose the good ones; that is the real signal.
Small and regular beats rare and large
A modest increase each year, as costs rise, is easier for everyone than a large jump after five years of absorbing costs. It also stops margin from quietly shrinking in the meantime.
Also asked
- How much should I raise prices?
- Enough to restore the margin your costs have taken. Work out what each kind of job really costs you, then price from that. Not from what a competitor charges.
- Should I explain the increase?
- Briefly. One or two honest sentences about rising costs is enough. Long justifications invite negotiation.
- What if a big customer pushes back?
- Know your number before the conversation, the price below which the work is not worth doing. Meeting them partway can be fine; going below that is not.
Related
Written for your trade
This is the kind of thing Solomon works through with owners using their own numbers. See how it works →