(MENAFN- Gulf Times) Let's face it: your prices must increase at some point or another. You can't hold on to your same price forever; an increase of your prices is just as inevitable as your own costs increasing.
But the thought of losing our customers is what sometimes can hold us back from making the decision, or delay it to the point that we're put in a corner.
However, there are ways to raise prices that can greatly reduce the risk of losing customers, and in some cases, even strengthen the relationships you have with them.
1) Make the price increase a win-win situation. If you sell to retailers, for example, could you make your new price an opportunity for them to make an even higher margin when they sell your product on to consumers? That would make the price increase attractive. You could also add extra features to the product or service that make its perceived value justify the higher price. Both these moves take thoughtful communication, but can be positioned as a benefit to them. Which brings me to my next point.
2) Communicate, communicate, and communicate. Never assume that your customers will just "get" that your prices have increased unless you tell them. The best way to do this is to tell them that you really appreciate them, and to give them enough notice that you are increasing prices. That way there are no surprises. Throwing in the reason why you are increasing prices (higher supplier costs, market evolution, or increased skills and knowledge that justify the price increase to customers are examples) will make your customers aware of the thinking behind the decision.
3) Monitor the market. Watch if the competition react to your price increase. Do they follow suit or stay where they are? If they don't budge, then you might need to continue to add as much extra value as you can to justify your price increase until they do (better credit terms, enhanced features and service, and improved marketing activities are some examples). If they do proceed with their own price increase, then you have less to worry about.
4) Never apologise! You do not need to be apologetic for increasing your prices € this is how business is done. As your products and services develop, they should be worth more. Once you have made the change in price and things have calmed down, move on. If you have proven your worth through strong communication and making it a win-win situation, then your customers will remain loyal.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.