How Can You Tell Your Customers You’re Raising Your Prices?

Eventually, the time comes when you will need to raise your prices. Whether you are selling a product or service, various factors–including expense, time, etc.–can influence your need to raise prices for the benefit of your business. However, no one is ever terribly thrilled to hear that the cost of a product or service they purchase is going up. Handling price raises is a rather delicate matter.

I am of the opinion that the best way to handle a price raise–regardless of the sort of home business you are operating–is to be proactive and pleasantly direct with your customers or clients. Tell them firsthand BEFORE they get a bill or invoice that shows the increase. If possible, give them a month or two to get used to the idea before you enact the price change. This helps to alleviate the “shock” factor. Either call your customers or clients, or send a pleasant and informative note letting them know about the price change and when it will take effect. Then be prepared to answer questions.

I also think you should know exactly why you are raising your prices and be willing to share that with your customers. Tell them that you are raising your prices on XYZ service because your shipping costs have gone up Q%. The more honest and factual you are with your “people,” the less likely they will be to hold it against you.

It is natural to expect to lose some clients and/or customers with a price increase. While it doesn’t always happen, it is incredibly common. In my experience in performing arts and the publication world–raising ticket prices or subscription prices always means some attrition–even when the increase only seems like a small dollar amount. Be sure to calculate this in to your budget when you are evaluating the effect that raising prices will have on your overall business. While you may make it up in revenue from the increase, you will need to put some effort into attracting new clients and customers once your prices go up.