Raising Your Rates — On Existing Clients

Ilise Benun on your online marketing planYesterday, I wrote about raising your rates on new clients.

Today’s topic is a bit trickier…raising your rates on existing clients.

It’s trickier because clients must be trained to expect an increase — and chances are yours aren’t.

Here’s what I wrote about this in my latest book, “The Creative Professional’s Guide to Money: How to Think About It, How to Talk About It and How to Manage It.”

Certain seasons or times of year are conducive to change and can be used as a catalyst, such as the new year. That’s why December is a good time to start thinking about how you’re going to do it and letting your existing clients know.

Anything new, for that matter, can serve as a justification for increasing prices: new company name or business structure, new office, equipment or employees.

You can move long-term clients slowly and incrementally toward a higher rate. What’s important is setting the precedent that things will change—the specific change is incidental. So even if the increase is miniscule, what’s important is that it takes effect.

Or you can suggest a different type of working relationship with an existing client. For example, if you’ve been working hourly to date, you can suggest moving to project-based fees.

When you modify or upgrade your services is a perfectly logical time to increase prices too, especially for existing clients. Offering new services is like a new beginning. It creates a new mind-set, especially if you position and promote it that way.

Old rules no longer apply, and the result is much less pushback from existing clients. Often, in fact, negative reactions to higher prices are a result of how they’re presented, not the prices themselves. Always give clients plenty of advance notice that something new is coming up. Give them details about how they will be affected. Give them time to respond and an opportunity to provide feedback.

How do you do it? Or if you haven’t, what’s getting in your way?

4 thoughts on “Raising Your Rates — On Existing Clients

  1. Priscilla Then

    Thanks for the tips Elise. I bought your book “Marketing & Pricing Guide for Designers”, and you said to give 2 months of notice before increasing your fees. I was working at almost rock-bottom prices for my translation service, but after doing a little research, learned that translation students were making double the price (and since they’re francophone, they make mistakes when translating from French to English — I saw them in professional communications all the time in Quebec City). I just spent the last year operating my own business, without a website (glad to say it’s finally up and running as of yesterday, though still a work in progress). Anyways, funny how one of my new clients seemed surprised at my level of professionalism and quality of work (you are right in that pricing is also a positioning tool — I should definitely be charging more for the quality of work that I do). I told him this week that I’m doubling my prices in Feb. 1st, but wonder if I can’t just raise it in January? How important is it to allow 2 months notice? I’d much rather just increase them as of Jan. 1st (although it may be too “late” for that one client).

    1. Ilise Benun Post author

      Priscilla, to take advantage of the “new year” I don’t think you have to wait til February. The idea is to give plenty of notice so sometimes 2 months isn’t necessary. Just gauge your client’s reaction and if they seem to need more time, then give it.
      Make sense?

  2. Ruth

    Great advise I have been thinking about doing this for the new year to a few of my old existing clients – but I wondered what you would suggest would be the best way to notify them? a professional document/contract or just an email. You also mention letting them know how it will affect them. What do you mean by that?
    Thanks

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