Every year we are asked by our clients, “how can I raise prices in the new year to support growth and curb inflation?” When you are a service based firm, it is easy to get stuck in a rut of keeping the same prices year-over-year. However, year-over-year you are not the same firm. You are growing and you need to sustain that momentum while complementing your added intrinsic value. To keep a steady balance, evaluate competitive costs within the market, the demands of employees, and internal services with billings.
Now let’s get started with raising those prices. Remember Warren Buffet’s quote, “Price is what you pay. Value is what you get.” Be sure you align the two and take a hard look at your actual value. Raising prices may be necessary, but should be as trouble-free as possible for clients. Typically, new clients should get the high end pricing while current ones will have a slight increase. Prices for future clients should be raised at least 3-5 times inflation which can also be accompanied with discounts to clients on current prices. Make sure to provide current clients with a 30-60 day notice so they have the opportunity to find another solution if they don’t support the firm’s new conditions. Not sure how to announce this new information? Here’s an example of how to approach the new updates to your clients.
2022 Billing Updates
We would like to notify you of pricing changes to our services and billings effective January 2022. The billing changes will be reflected on your January 1, 2022 billing statement. We are letting you know now, so you have time to plan your business and budget for next year. In order to streamline our processes and improve efficiency, we must increase our pricing for 2022. Your new base price effective January 1st, 2022 will be $[NEW PRICE]. Together we are building long term relationships based on the growth and success of each party, and that’s our favorite aspect of this business. We want to take this opportunity to express our appreciation. If you have any questions, please contact us via reply to this email.
Thank you and happy holidays!
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