Raising prices on current customers - Cleaning Talk - Professional Cleaning and Restoration Forum

Lisa1970 · 11-20-2008, 08:21 PM

We have a few customers that we've had for seven years and we've never raised prices. What is a fair amount to raise and do you do it every year? Also, what do you say in the letter?
Thanks

PressurePros · 11-21-2008, 07:40 AM

You should raise at least by the same percentage as inflation or you are losing money. In reality, to maintain margins, you have to raise a little more than inflation. Its better to raise people every year by 3% than it is to hit someone after 7 years for 20%+

TailoredMaid · 11-21-2008, 08:02 AM

Quote:

Originally Posted by Lisa1970

We have a few customers that we've had for seven years and we've never raised prices. What is a fair amount to raise and do you do it every year? Also, what do you say in the letter?
Thanks

This is a good link of a sample letter that you can modify. I'd cite the reason as increased fuel costs, materials, etc. on the opening statement. Or, you can eliminate the entire first paragraph and go with the rest. I don't think you'd really even need to justify why you are raising prices when you haven't done it for so long!

http://www.4hb.com/letters/ltranncincr.html

I hope this helps.

Lisa1970 · 11-21-2008, 08:35 AM

Thanks guys! It's terrible that we've never raised prices. We were always afraid people would say no and not want us anymore. I didn't realize we should raise every year. If we raise 3% won't that be an odd amount for the people who pay cash? Instead of $80 they'll have to leave $82.40?

Thanks

TailoredMaid · 11-21-2008, 08:51 AM

In that case, I'd round up to $83.00.

It doesn't have to be exact, but don't be afraid of non-even numbers in your quotes. I had jobs that came to $126 or $174 and that's okay. That's just the cost of doing business.

ETA: I'd rather lose a client that I am losing money on to open a slot for one who will be profitable. If you think of it that way, you won't be as afraid to raise prices.

Pressure Cleaning · 11-21-2008, 09:45 AM

Here's a inflation calculator http://data.bls.gov/cgi-bin/cpicalc.pl so you can raise your prices according to last year's dollar value.

Lisa1970 · 11-21-2008, 03:53 PM

Quote:

Originally Posted by Pressure Cleaning

Here's a inflation calculator http://data.bls.gov/cgi-bin/cpicalc.pl so you can raise your prices according to last year's dollar value.

That's pretty cool. I put in $80 in 2001 (that's what we charge a job we started 7 years ago) and in 2008 it should be $97.83. That's a lot of money we haven't been getting. It adds up. Thanks!

Ron Musgraves · 11-21-2008, 04:29 PM

I raise them every year, gotta do it.