4 Reasons You Need To Raise Your Rates
Setting the pricing in your business can feel stressful. If you go too high, what if no one buys? But if you go too low, you risk not making enough income in your business. With pricing being such a tough decision, get ready to feel uncomfortable when I tell you...IT’S TIME TO RAISE YOUR PRICES!!!
Does that make you squirm in your chair a bit? Yeah, you’re not the only one.
When I tell you to increase your prices, what’s the first thing that pops into your head? One of the most common fears you may have is, “I feel like my current customers probably won't pay my new prices.” If that's a thought you’re having, it probably means it's time to raise your rates because you're thinking about it. You didn’t tell yourself that you shouldn’t, you just thought of a limiting belief that feeds into the fear of failure.
Also, you’re reading this post, which means you aren’t totally against the idea either *wink.*
Since you’re sticking around, here are a couple of questions to ask yourself to see if it's time to increase prices:
1. When's the last time you raised your rates?
I was recently going through a client's pricing for her different services, and as we were looking to increase prices and the strategy for putting her new prices out into the world she said, “I haven't really raised my rates for this in three years.”
I mean, the cost of toothpaste at the grocery store goes up every year, right? Because we know that production costs more and inflation and all those things! So baseline you should be raising your rates every year. That’s not even a question.
If you've been a photographer for three years and haven't changed your pricing, remember that your expertise, your photos, and the experience that you offer your customers have significantly grown over three years! So, of course, your prices should reflect your growing expertise!
If you haven't raised your rates in a couple of years, it's definitely time, girl!
2. What does your competition charge?
Along with looking at your growing expertise and improved customer experience, it’s time to look around at your competition, too!
I’m not telling you to do this in a negative way to make you feel inadequate. Instead, do this just to get a gist of what's going on around you. What are people who are like you with the same level of skills, knowledge, and expertise charging for their services? This is really important to know because it gives you an understanding about your pricing and can often show you that it’s completely okay to raise your rates!
3. Are you overdelivering and undercharging?
Do you find experiencing burn out and almost resenting your clients? Do you have inner dialogues that sound like, “Dang, they're getting a deal! I'm frustrated that I'm spending all this time and it feels like I'm making NO money.”
Sometimes I think that we feel we need to keep our prices low if we want to serve. And that's limiting yourself to a really short-term vision, because, in the long run, you're going to burn out. You're not going to be able to produce your best work and, potentially, you are going to become very resentful of your clients!
And that's not what we want. That's not going to create sustainability in your company!
So if internally you're feeling really negative, know that I went through this myself. I was like, “Man, I feel like I'm massively over-delivering here.” When I noticed myself having those thoughts, I did something some may think is crazy...I QUADRUPLED my pricing! And guess what?? My client roster is still full and my business is thriving!
I’m being honest when I say that this can totally be something that can happen for your company too.
4. Are your clients subtly telling you to raise your prices?
Your customers may be subtly letting you know to raise your prices. I've talked to many women who feel scared to do that, but then also tell me that their customers have said things like, “I'm getting such a deal.” Or that they think the value is beyond what they are paying. We always want our clients to feel and to experience that they're getting an above and beyond service, but this is also a pattern that we need to keep our ears open to hearing. Because this probably is a signal that something's off in our pricing.
Pricing is something I know a lot about and have an abundance of strategies for helping my clients nail down what they charge.
- Do you feel like you've not raised your rates in quite a while? Girl, it's time.
- Do you look at your competition and think about your expertise, your skills, how much you've grown and know you’re undercharging? That’s the truth! Listen to it!
- Do you feel burnt out and internally frustrated with your clients because you know that you're over-delivering? It's not their fault; it's your fault.
- Are your clients almost telling you they would pay more? Listen to them!
I would love to hear in the comments...which one of the four questions resonates with you the most?
And if you think it's time to update your pricing strategy, I'd love to chat! In the meantime, I've created a resource that will get your wheels turning when it comes to pricing and sales. Download my FREE Savvy Sales Guide for five super simple strategies that you can implement RIGHT AWAY to increase your sales confidence and see the income growth results you’ve been dreaming about!