I just got another notice in my email about one of my providers who is raising their rates.
Of course, these notices get my attention, especially when it seems nearly everyone is raising their rates.
The smallest rate increase I have been notified of is 12% and the largest is a whopping 100%!
The impact on my next year’s budget is huge.
And I am certain I am not alone and you too, are getting notices like this.
In my experience most people entering the fitness business make their decision on a very personal level, they want to help people.
Most people have very little sense of what it takes to run a business and make business decisions.
This is especially apparent when it comes to pricing products, and perhaps the hardest of all is raising prices.
Been there and done that! Many times over.
Not raising our rates, on at least an annual basis, is perhaps noble if you are a non-profit.
But my experience with over 15 years in the non-profit sector, is that well-run non-profits raise their rates at a minimum, on an annual basis.
Failure to do so is just plain foolish as it compounds, or creates, financial problems for the business.
We always imagine that we will lose clients once we raise our rates, when in reality this imagined future is simply in our heads, based on fear.
Imagine a significant price raise, something that is in keeping with what is going on in the rest of the country right now. Write that number down.
Then take a sheet of paper and make a list of everyone you are certain will leave you with your increased new price.
You will find the list is surprisingly small.
Now imagine that you explain and carefully announce your imagined price increase, and give people some time to adjust to and digest the rate increase.
Now the list is even smaller. Try it, you’ll see.
We need to remove our pricing biases and assumptions from our thinking.
Your final assignment is to write out how your world will change if you don’t raise your rates. I guarantee this is an ugly picture because all of your expenses are increasing.
Raising prices is a business decision, and we need to take our emotions out of the process.
The most important thing to remember is HOW you announce your price increase, it is critically important.
Want some ideas on what the next steps are? Get on my schedule for a free 30-minute conversation.
Remember, you only get results when you take immediate action on your ideas.
