KickStart: Benefit from our current run-away inflation rates to justify your new (large) price increases.
Outline
Introduction – Raise Your Prices The Smart Way
Are you a residential service contractor struggling to keep up with rising costs? You’re not alone! Many of us are facing the challenge of increasing prices while still maintaining good relationships with our clients. If you’re looking for a solid price increase strategy that not only helps you boost your bottom line but also navigates the current inflationary environment, then you’ve come to the right place. This article will explore how to strategically raise your prices, even dramatically in some cases, while keeping your customers happy and your business thriving.
/
Want to DRAMATICALLY increase your CSRs’ “booking ratio”?🤔 Then quickly train them with my interactive Converting the “How much do you charge…?” Caller! video course. One low price (Heck, you may cover it in your first “converted caller”!👍) quickly trains unlimited phone reps!💲Click HERE to learn more… 2025 New Year Special Offer 40% Off
Two Convincing Reasons To Apply Strategic Pricing Increases
In ‘normal times’ (is there such a thing any more?) I’m a huge proponent of small (3% to 4%) yearly price increases. Here’s why:
1) A small yearly price increase strategy will ‘fly under the radar’ of your clients. (Most customers can’t remember what they paid last time.)
2) The power of compound interest means over time you will ‘painlessly’ raise your pricing AND your profits! Remember, Steve Toburen always tells his students: “All other things being equal… its better to have LOTS of money instead of having NO money!!”
Implement Your Price Increase Strategy Sooner The Better
Sadly, some of my clients haven’t been raising their prices (even a little bit) every year.😲 If this sounds like your company are you condemned forever to a marginal, low-price business?😥 Fear not!
Here’s how to catch up by benefiting from these ‘abnormal times’. Inflation is currently running at a 40-year high and your customers know this! First, you and your accountant should do a deep dive into your financial reports and then…
Dramatically (but SELECTIVELY) raise your prices… now!
Steve’s ‘Secret Sauce’: Make inflation the ‘Bad Cop’!💲💲 When and IF (most won’t) a previous client utters these dreaded words: “Isn’t that more than I paid last time?” your company will be the ‘Good Cop’ when you calmly reply…
“Yes, Mrs. Jones, sadly on March 22nd we were forced to raise our prices for the first time in ___ years.” (Pause here and wait.) Almost invariably your past customers will say, “I understand. So, when can you fit me in?”💖
Pro TIP: Whatever price increase strategy your financial analysis comes up with tweak it into an ‘odd percentage’. (This will be much more credible when justifying your higher pricing.) For example, instead of a 20% price increase make it 19.2% or 21.4%.
RESOURCE: In our 3-hour, online SFS: ‘Winning over your caller’! LIVE seminar I share a complete “Booking Previous Residential Clients after a Price Increase” Phone Script.💲💲💲 You’ll pay for your entire class with the first recalcitrant client you ‘Win Over’!👌
Act Quickly, But Don’t Get Greedy
However, notice the word “SELECTIVELY” above. Seriously, analyze your past production numbers over the last year. With some services you may just be ‘trading dollars’ or even be losing money! After all, you may not have focused on my 8-point Diversification Checklist before adding a new service!
So, you may need to SUPER dramatically raise your pricing on some services! Yes, you may lose some clients but remember that these are profit-sucking jobs!🙄
True, with some other peripheral, non-synergistic services you may decide to eliminate them completely. Or you can refer these less-than-desirable jobs to a Strategic Partnership. (Possibly even for a commission.)
We review here some ‘Profit-Sucking Candidates’ that may very well be an unseen cancer in your business.
Summary – Confidently Apply Your Price Increase Strategy
So, as we’ve seen, implementing a smart price increase strategy is crucial for residential service contractors, especially in today’s economy. It’s not just about covering your costs; it’s about ensuring the long-term health and profitability of your business. By carefully analyzing your finances, strategically adjusting your pricing, and communicating effectively with your clients, you can not only survive but thrive. Remember, a well-thought-out approach, combined with a little courage, will allow you to get the compensation you deserve for your valuable services, while maintaining those all-important customer relationships. Don’t be afraid to take control of your pricing and secure your financial future!