Pricing advice kindly appreciated!

[tirediron]

Think it's important to me, that my existing clients enjoy the benefit of no price increase. The ones that are good enough to come back to me time and time again. I could even send out a bulletin about price increases, while stating that it will not apply to existing customers, as loyalty is important to me.

I don't know that I would go so far as to say 'no' price increases for existing customers; that could cause issues, particularly if a new customer talks to an old one. "So Bill, how much did Ruth charge you for that catalogue job? Three hundred quid! What???? She charged me eight hundred Sod her, I'll find someone else!"

What I would do is send out to all of my customers that due to increased costs of rent, gumdrops, and whatever that you will have to be raising your prices significantly over the next year. As of now, rates have increased from 'X' to 'Y', however as a customer loyalty bonus, you will receive 'Z' percent discount on all work. People understand prices go up. They don't like it, but they understand it. Using a tiered increase plan and discounts for previous customers, I think you can mitigate most of the damage that these increases could cause.

 

[Gary A.]

Smugmug that that exact thing to me. It raised its prices for new customers while the existing enjoy no increase. As an existing customer it made me feel valued. As to the feelings of clients you do not have ... a bird in the hand is better than two in the bushes.

 

[tirediron]

Smugmug that that exact thing to me. It raised its prices for new customers while the existing enjoy no increase. As an existing customer it made me feel valued. As to the feelings of clients you do not have ... a bird in the hand is better than two in the bushes.

True, but you have to compare the customer bases between Smugmug and Ruth, and as well the size of the increase. We're suggesting a 4-500% or more increase to her prices. A big issue of course is the amount of repeat business; it would be worth considering different discounts for clients who've put more work her way.

I think that the discount will achieve the "I'm a valued customer" aspect, but at the same time, prep them for paying more money in the future. If these are knowledgeable commercial clients, they already know they've been underpaying.