Raising prices on current customers - Cleaning Talk - Professional Cleaning and Restoration Forum
 
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post #1 of Old 11-20-2008, 07:21 PM Thread Starter
 
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Raising prices on current customers

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
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post #2 of Old 11-21-2008, 06:40 AM
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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%+

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post #3 of Old 11-21-2008, 07:02 AM
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Quote:
Originally Posted by Lisa1970 View Post
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.

Torrey Shannon
Executive Director/Spokesperson
Cleaning for Heroes
The only 501c3 nonprofit in the cleaning industry that improves the lives of heroes, one household at a time!
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post #4 of Old 11-21-2008, 07:35 AM Thread Starter
 
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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
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post #5 of Old 11-21-2008, 07:51 AM
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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.

Torrey Shannon
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post #6 of Old 11-21-2008, 08:45 AM
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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.
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post #7 of Old 11-21-2008, 02:53 PM Thread Starter
 
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Originally Posted by Pressure Cleaning View Post
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!
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post #8 of Old 11-21-2008, 03:29 PM
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I raise them every year, gotta do it.
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