There are lots of reasons to review and increase your prices on a regular interval. Many creative business owners find it difficult how to approach this topic, but in the business world it is fairly normal that prices or fees increase or change.
What is really important is that you tell your clients in advance if you are planning to increase your prices.
People want to be able to trust you, and like the truth, so tell them! Give them reasonable notice, so they can make a choice. You might even get some more clients, as raising prices is a great excuse to get in to contact again with previous clients!
What is your reason to raise your price?
You don’t need to have a reason! But your clients might want to know.
Simple, because you want to earn more (but be aware that if you charge too much your profitability will actually go down! Becoming more efficient and create more in a shorter period of time might actually have a similar effect on your longer term profitability as raising your prices)
Your costs have gone up. Due to the current economic conditions and annual inflation everybody is increasing their prices. Your material (for example the price of gold!) or travel costs might have increased dramatically and need to be carried over (more) to the client. January is normally a month when companies increase their price.
You want to reposition yourself or work with a different target market that enables you to charge more.
You are busy (or not) and overbooked, but especially want to work less hours but earn the same or a higher annual salary.
You have increased your credibility, done more training, got more experience, have worked for a while, have improved your brand or website.
Don’t be afraid to increase your price as it might have less effect on your sales than you expect. Very few people buy crafts or design purely on price alone.
How to introduce new prices?
Firstly, as said above, let your existing clients know in advance.
It is far easier to increase your prices if you provide a service than a product, as they are less comparable with each other. In fact, if you provide a service you might not even state your prices (on your website or brochure), as you want people to contact you to discuss their specific requirements and provide a specific quote. Unless your service is a very specific programme with specific features that clients always get as part of a package you will not need to provide a fixed price (and therefore it is easier to increase it).
If you increase your prices of your product or your hourly rate then do this by a percentage, and introduce in the first instance to new clients. If you want to you can give a reason, but you don’t need to – be confident about it that you are worth it!
If you introduce new services or products it is easier to introduce them at a higher rate from the beginning. So repackage products or services in a slightly different way and give them a new higher price. Discount older stock so that there is less comparability, which will decrease the chances of somebody asking about your price change.
Be confident about your work and the value that you add to that specific client, and you will be able to charge the price that you are worth!
Have you recently increased your prices? What happened? Please share your story here below.