How to increase your prices AND keep your clients

May 12, 2020

The sad reality dawning on many businesses right now is that no matter how hard we try there will need to be some of the additional costs being faced, passed to clients.

 

With the requirement to provide PPE, potentially see less clients on a daily basis to maintain social distancing and the very real possibility of seeing increased stock costs, now is the time to review your business strategy and how you remain profitable. Inevitably some these increased costs will need to be added to the services that you provide, but how do you do this at a time when everyone is feeling the financial strain of Coronavirus and how do you actually manage to keep your clients?

 

Careful thought needs to be given to what your price increases are likely to be and how you communicate them to your clients, here are 10 strategies to get you started:

 

1.    Believe in your price increase and be confident of where you set it. There is no point being swayed by client demand or disappointment, you need to hold firm and deliver the price increase with confidence, that the price you are setting is fair for what you are providing.PPE has become increasingly more expensive and difficult to come by and by providing it you are safeguarding your clients and staff from the spread of infection and that reassurance that you are providing is worth the price you are asking.

2.    Be transparent, be up front and honest with your clients as to why you have set the price increase that you have. Clients may not consider that your PPE provision is so expensive, they may not appreciate that you may be working at 50% capacity for a period of time as well as potentially facing additional insurance costs. Most clients can appreciate price increases if they understand the why and appreciate that there is no profit coming to you for that increase. When they see that this increased price offers them safety assurances its hard to not see the value in what you’re doing.

3.    Provide a timeline to your clients, so they know when the changes will happen. This allows them time to absorb the information and be comfortable with it and doesn’t feel like a sudden price hike on a whim.

4.    Sell the benefits of the price increase to your clients, make them aware that the increase allows you to add additional time to their appointment to ensure full additional cleaning of your work station, the increase costs allows you to buy in effective PPE which safeguards your clients health as well as ensures that your business (that they rely on ) can remain operational.

5.    Consider building in additional value or build packages of treatments that offer an overall discount which may soften the blow of a cost increase.

6.    Be able to demonstrate improvements in your service offering that the price increase has facilitated. For instance, if you are doing additional cleaning between clients make sure this is visible and obvious, ensure that you are wearing PPE that looks up to the job and professional.

7.    Offer discounts for bundle buys or block bookings, consider your client base and what would be a value offer for them, some may be happy to book in their next 12-month worth of appointments for a discount or introduce a friend (or 2) for a discounted treatment. Perhaps you can offer discounts if client’s buy the shampoo and conditioner brand you use on their hair or the skincare range that you used for their facial. Think about your treatments and type of clients and devise treatment bundles that would still cover your costs but make the client feel valued.

8.    Review who your client is, we have touched on this in other blog posts, but it really is so important to know who your “ideal”client is. Your ideal “client” is not the client who only appears (late) when you have a deal on. Look through your client database and identify your loyal good clients and consider how you would directly sell your price increase face to face with that client. Do you need to consider the types of clients that you attract and perhaps review what your ideal client looks like? Knowing who our ideal client means you can be visible in the places they hang out and use amore targeted marketing approach to attract them to your business.

9.    Be prepared to deal with unhappy clients, ok it’s not a pleasant thought but you know there will be some, the key thing is to be prepared for it. You may even be able to look at your database and know who they will be. Be confident and calm in your approach, be sure on your pricing and how you came to that figure and what benefits it will bring to the themas the client. Be non-confrontational no matter what the client says and remember that their unhappiness at your proposal is likely to stem from something other than you.

10.  Don’t forget to say thank you, loyal clients are the life blood of your business and they have been through a tough time lately too. Don’t forget to thank them for their understanding and commitment to you and your business. Reassure them of your best intentions at all time and remind them how grateful you remain for their custom.

 

Taking on board these strategies makes it harder for clients to walk away from you (and remember other businesses will be doing the same anyway). What you aim to achieve by taking these measures is to communicate a fair price increase that continues to offer your client’s value and maintains the great working relationship you have with them.