Seven tips on increasing prices

We all know prices are going up across the country but still many businesses get concerned about increasing their own prices out of fear they will upset or lose customers. If you are in the situation where you know you need to increase prices but are unsure what to do here are seven tips you might find helpful, along with some supporting articles.

1. Be up front and honest about a price change. Hiding an increase will damage your reputation and your trust in the eye of your customers

2. Make sure your whole team understands how and why prices are changing. You don't want mixed messages going out to clients.

3. Justify the increase but don't go into too much detail. A justification that is simple to understand and defend softens the blow, but be wary of over explaining. The more detail you provide your customers the more objections to your reasons you will get.

4. Remind customers of the value you provide and any increases are helping you to continue to deliver a quality product/service.

5. Have a procedure (in place before the increase) as to how your staff should handle objections or complaints.

6. Price increases are part of business, sometimes as owners we over think the negative consequences and forget about the obvious financial benefits. A price increases goes straight to the bottom line. As an example take a business with a net profit margin of 20%. If they increased prices by 8% their net profit would jump by 40%!

7. Finally if you are still unsure, test a price increase on a subset of your customers. Use the feedback your receive to adjust the approach for the bulk of your clients.

Further reading:

https://www.inc.com/marc-emmer/how-to-raise-prices-without-losing-customers.html

https://blog.hubspot.com/service/price-increase

https://the3fs.com/how-to-raise-prices/