The biggest fear that most entrepreneurs and small business owners face when deciding to raise their rates is the threat of losing their existing clients. If you’re debating whether or not raising your rates is a good idea, there are usually two reasons at play.
First, you probably need to slow down your workload. If you’re so busy that you can’t find time to breathe, raising your rates has the potential to stem the flow of work without negatively impacting your bottom line. Fair warning, though, I raised my rates recently and my clients didn’t even blink. A few even asked what took me so long. If raising your rates doesn’t stem the workflow, at least it makes the work flow slightly more enjoyable and opens the door to hiring extra hands.
The other reason you might want to raise your rates is to say goodbye to cheapskate clients. I had one of those clients. He was constantly trying to get me to lower my rates. He frequently threatened to go with another copywriter. I politely wished him well, and he always came back. You might be lucky enough to free yourself from bargain hunting clients with a rate hike – just be careful not to price yourself too far out of reach for all your clients.
You can handle a price hike in one of two ways. Either change your rates with no notice and hope for the best, or send out a carefully worded notice that your rates will increase soon. If you opt for the former, many clients won’t even notice the change. The ones who do notice will ask for an explanation and you can give them a personalized, sincere one. If you opt for the latter, explain your increased pricing, detail how you’ll continue to add value, and get in the habit of under-promising and over-delivering. Your rates can’t stay stagnant forever. Make sure you handle raising your rates like a pro and don’t back down for one client or word will spread like wildfire, and you’ll be right back where you started.
Subscribe to my blog for more timely topics and cool resources for small business owners, entrepreneurs, and bloggers.
**********