Raising Your Prices - Susie Jackson

I’ve dedicated the final instalment of this three-part series to helping you focus on raising your prices.

It’s important to check in with your pricing regularly so you can make sure it’s still relevant to your circumstances. If you don’t, you risk not earning enough to cover all your expenses without having to work longer hours.

As freelancers and small business owners, increasing our prices is one of those tasks that often gets pushed to the bottom of our to-do lists. We often think that now isn’t the right time, that we need to get more qualifications under our belt or that we need to finish a certain project before we can even think about raising our rates. But we need to make reviewing our prices a priority if we want to create a sustainable business that will support us in the long term.

In this blog post, I’m therefore suggesting five financial tasks you can do the next time you set aside a couple of hours to check in with your pricing. I hope these ideas will help you increase your income in 2022!

1) Look at your latest numbers in relation to your current circumstances

A lot can change over the course of a year, in both your business and your personal life. Perhaps you’ve moved house and are making higher rent or mortgage payments. Maybe you’ve set up a pension, the price of your software has increased, or you’ve decided to invest in coaching to help grow your business further.

All these increases in your expenses need to be taken into account as part of your pricing strategy. In Charge with Confidence, I teach participants how to set their rates to cover their business and personal expenses so they can earn a decent living while working the hours they want to work. This is why it’s important to take into account any changes in your circumstances and expenditure.

When checking in with your pricing, assess your latest numbers and make sure that your rates are still relevant to your current circumstances. If they’re not, look at what needs to change and review your pricing strategy. Do you need to reduce some of your expenses, or do you need to increase your prices to make sure you’re earning enough to cover them?

2) Analyse your time-tracking data

If you look back at your time-tracking data from recent months, what do you notice? You can learn so much when you analyse the information you’ve gathered from tracking your time.

Are you actually spending fewer hours on paid client work than you’d anticipated when you set your rates? If this is the case, you need to look at raising your prices so that you’re making more per paid hour worked.

Similarly, if you have some customers who pay you per hour, are you getting through their work faster than you used to? You might find that compared with when you started working together, you’re earning less per deliverable because the work is taking you fewer hours to complete. Again, if you find yourself in this position, you should be looking at raising your rates so that clients don’t see the price of the work you're supplying going down rather than up.

3) Assess your profitability per client and service

You can also use your time-tracking data to help you assess your profitability per client and service. All you have to do to calculate your profitability is divide the amount earned by the number of hours worked on a specific client’s projects or on providing a specific service.

Knowing your profitability per client and service can help you identify any areas in your business that require your attention. For example, let’s imagine that your average profitability is £30 per hour. However, with one particular client, you find the work incredibly time-consuming and you're only making £20 an hour. This is a sign that you need to either increase your prices with this customer or consider letting them go and replacing them with a higher-paying client instead.

The same goes for your services. You might find there’s one particular service you’re providing that seems to be less profitable than all the others. If it’s a service you don’t particularly enjoy, you might want to consider discontinuing it and focusing on the others instead. Or if you do want to continue providing it, it might be worth adjusting your pricing so that this service makes you as much per hour as your other services.

4) Create some email templates

Sometimes it can feel easier for us to just carry on as things are rather than going to all the effort of making a change. But while you continue like this, things will simply stay the same.

Creating email templates to have ready to send to clients when awkward situations arise can help you remove a barrier when it comes to dealing with them. The words are already there. All you have to do is adapt them slightly.

In terms of raising your prices, perhaps you could write an email template that can be adapted to each client to inform them you’ll be increasing your rates from next month. Or if you want to let some clients go in favour of higher-paying customers, you could prepare an email template to tell them you’ll no longer be working together in the future.

What’s more, these templates don’t just have to apply to raising your prices. For example, you could create an email template to send to clients who have overdue invoices too.

5) Explore new potential sources of income

While not directly related to raising your prices, this final suggestion will help you increase your income.

Think about new potential sources of income that could help you reach your income goal. You could consider new services to complement the ones you currently provide and extend your client offerings. Adding extra services can be a way to appeal to more customers and upsell to the ones you already have. So if you do extend your services, don’t forget to tell your current clients about your new offering too!

Alternatively, perhaps you could think about passive income opportunities. Could you write an ebook and sell it on your website? Or how about creating a subscription model, offering recorded ecourses or even selling unused work? Is there something you could do that would allow you to bring in an extra source of income without having to work on it too actively?

In fact, if you do decide to create a source of passive income or add a new service, why not price it higher than you would have done in the past?

I really hope these suggestions have given you some ideas to help you increase your income over the coming months.

If you’ve already carried out some of these tasks and realise you need to raise your rates but aren’t sure how, you might want to consider Charge with Confidence. I’ll walk you through how to go about calculating your rates, so you’re earning enough to cover all your expenses in the hours you want to work, as well as how to communicate those new rates to your clients.

To find out more about the programme and take the first step towards increasing your prices, click on the button below!

Increase your prices through Charge with Confidence