How much should I raise my prices?
At least as much as your costs went up.
- For
- Raise your prices enough to keep your profit when costs go up.
- When
- Once a year, or when costs jump
Try it
A 200 job, 60% of it costs, costs up 8%: charge 209.60, a 4.8% rise.
Rise = price × the share that’s costs × how much costs went up.
Raise the price when costs rise, not a year later.
Worked out
| Costs up | Costs 40% | Costs 60% | Costs 80% |
|---|---|---|---|
| 3% | 202.40 | 203.60 | 204.80 |
| 5% | 204.00 | 206.00 | 208.00 |
| 8% | 206.40 | 209.60 | 212.80 |
| 12% | 209.60 | 214.40 | 219.20 |
Easy to get wrong
- Waiting until costs have risen twice.
- Raising the parts, not the hours.
- Apologising for it in the message.
- Old prices left on your page.
The tool for it
Questions
Will I lose customers?
A few may go. A small rise each year loses fewer than one big one.
How do I tell them?
One line, a month ahead: the new price and the day it starts.
Do quotes already sent change?
No, they hold until their good-until date.
Should I raise it more than my costs?
If you’re booked solid, yes: that’s a sign the price is low.
What about plan customers?
Raise it at renewal, and say so in the reminder.
How do I know my costs went up?
Compare this year’s parts, fuel and wages with last year’s.
Is once a year enough?
For most, yes. Sooner if a big cost jumps.
Do I explain why?
One short reason is enough; don’t apologise.