How to sell a price increase to your customers
While delivering news about a price increase that may negatively affect your customers can be nerve-wracking, the key is honest and open communication.
A diplomatic and thoughtful approach will indicate your concern for the wellbeing of all parties and help to build trust with your customers.
Here are some tips that can help you succeed in selling a price increase.
Provide your customers with enough notice of the upcoming cost increase. This will allow them to make necessary adjustments in their systems and to prepare for the changes.
Give your customers reasons as to why you are increasing your prices. Explain the factors that make the increase necessary, such as higher energy or increased labour costs. If you can logically defend why you are raising costs, it allows customers to understand where you are coming from and be more open to the change. Breaking down the specifics of what customers are actually paying for can help you justify your costs. By explaining all elements and costs of the service up front, you can potentially avoid later disputes over what clients were charged for.
Believe in the increase:
Price increases often fail not because the customer doesn’t accept it, but because the business doesn’t believe in it. A lack of confidence will come across to the customer, creating distrust. They may even use your insecurity to successfully negotiate a discount. To avoid this, develop a list of reasons why it is important for your organisation to take a price increase, which can serve as a tool to help you be confident in why you are raising your prices.