We are at a strategic time in our business with it being year end, almost the end of the calendar year, and a growing business heading in multiple directions. For me it is an exciting time of year because I am a goal setting monster, I love trying to figure out where the company will go next year, where we have been, and how we got there. It does however create a challenge as to where you should increase pricing and what services or products we may have to drop. If a year is going good no one wants to lose clients and the challenge of raising prices is that once raised you may lose some of your clients that can’t afford or choose not to spend the extra money, so what do you do?
Raising pricing on a regular basis is critical to keep any company afloat, expenses rise cost of doing business goes up, and inflation changes how much our money is worth. If you don’t change pricing your business will not remain for the future. How you raise your prices is as important as when you raise your pricing. Just raising prices because you feel like it or you got ripped off on your last job is not a good reason and will make you look like you’re trying to take advantage of people. I find the best time to raise prices if you have to is at the end of a calendar year. This way you give the impression and hopefully you did investigate the market and found a need to raise prices. We don’t raise prices every year, more so when required by business expenses or the market but certainly every three years. Keep your price increases to small amounts say $10 depending on your product or service. That way they aren’t as noticeable.
Now when you raise your prices you may get a resistance and you should be prepared to lose a few clients that feel the prices are out of range. That’s okay you will gain new clients down the road to replace those. This is where many of us are afraid to make the move we don’t want to lose clients. If you don’t make that move to raise pricing then the business is pushing you and will keep that fear in you and you will never raise your prices. You are the leader of your business and you need to cover your costs and make a profit. If you don’t you are either a non-profit business or your business is really a hobby. You need to push your business, don’t let it push you.
About the Author
Bruce Outridge is a business and leadership consultant with over 30 years experience in the transportation market. He is the author of the book Running by the Mile, and How to Start an Artistic Business in 12 Easy Steps. For more information on Bruce and his work please visit his website at www.outridge.ca