The time comes when you have to be bold and inform your existing customers that the cost of doing business with you is about to go up. It is within your right not to give any reason for the increase. However, when some customers ask, it becomes a tense moment for freelance workers. Why?
The moment is tense because you have been in a comfortable working relationship with these clients but now your action could lead to losing some of them who cannot adjust to the new prices. There is always the feeling that the freelancer pool is full of workers who are ready to go all the way down with their prices. This fear may hold you back from adjusting your price upwards. How can you justify such an increase without losing your current customers?
This is the most important justification of a price increase. Your product or service must always give evidence of a value that surpasses the cost. This alone will make the customer consider the value he will lose by not agreeing to the new price. You may also add new features to your product or service in order to justify increase further. Customers know value when they see it.
Another way of adding value is by introducing new features to your product or services. With this, you can then inform your customers that your price will go up.
If you are afraid that you will lose some customers, then give them options of going on with the current service or with the new one with the added features. With the perceived higher value of the new product or service, many will opt for the price increase.
You Want to Improve Your Income
This is the one and honest reason that many freelancers may find difficult to air. If you must explain, let the clients know that charges for your services have been low and cannot help you make it even to the equivalence of a minimum wage. The price increase is to help you at least approach this mark.
Expenses Have Gone Up
Every business has overheads. Freelancers are not exempt from this. Inflation and other economic influencers have a direct effect on the cost of doing business. Naturally, these added costs are passed on to the client. These are facts that customers understand only too well and those who value your services will not object to a price increase.
You Have Rebranded
A perceived high value brand asking for too low prices creates the wrong impression to high net-worth clients. They see a disconnection between your asking price and your brand. They conclude that there must be something wrong with your product or service and fail to buy. If you rebrand, consider raising the price to go with the new image.
You Have Improved
When starting out, there may be issues with speed, revisions and other problems. Now that you have overcome those problems, you are justified to increase your prices. Old clients have seen these changes and will not object to a reasonable increase.
Whatever the reason for your price increase, always over-deliver on what you have promised your customers. This way, your current clients may not even be surprised that your prices have gone up. They might even be expecting it.