Is now the time to Increase your Fees?

Suicide sale

If you remember about a month ago I re-launched my online art business with a better, cleaner and a more professional looking website. As well as this, after careful consideration I also decided to increase the prices of my artwork too, some even by 50% more and it has been one of the best business decisions I have ever made; which serves today’s discussion: price and fee increases.

Think back, when was the last time you evaluated your business going rate? Whether you run an ecommerce business or provide online services to customers, if you have been sticking to the same old going prices for an eternity, maybe now is the time to consider your options of increasing your fees and here are a few valid reasons why.

 

1. The cost of running your business has increased

Take a look around; you don’t need to be reminded that the cost of living has increased, and so the cost of running a business too. I’ve certainly felt an increase in costs to materials to the cost of courier and shipping fees in my line of business.

Increases in business costs are happening everywhere; the cost of equipment and stationary, the cost of advertising, fuel costs, cost of training and resource materials etc has all gone up, but your price to your consumers remain the same. Can you really afford to continue doing this?

 

2. Increases in taxes

Increases in business revenue taxes, VAT and other taxes are also good enough reasons to start thinking about increasing your fees and prices. After all you can’t keep absorbing these costs into your prices forever, just to satisfy your customer base.

 

3. Your prices should reflect the quality of your products and services

This remains to be 100% true. If you put as much time and effort in producing top quality products or offer a quality and exceptional service to your consumers, then your prices should certainly reflect this. Don’t be reluctant to increase them just because you feel that your customers might just find you too expensive, and therefore venture off elsewhere.

 

4. Customers may get put off by ‘budget’ style prices

No all of your consumers are going to view your cheap ‘budget’ style prices as a bargain. Often people generally get put off paying for cheap or affordable products and services because they assume they will be of poor quality, again taking us back to the price reflection issue.

 

5. Your business needs to grow

Finally your business can’t grow without some financial commitment. If you’re not making enough money to invest some of it back into your business then your business can’t grow, it’s simple. Increase your fees to generate more revenue for your business and allow it to grow more efficiently.

 

What are your thoughts?

You don’t need to go out and increase your fees right across the board like a mentally deranged goat, just start off with a few of your top selling products or services and see how you get on. Work your way up and make small changes where required.

What are your thoughts on price and fee increases? Have you recently tried to increase the prices of your own products and services online? Can anyone afford to grow their business in an economic environment where consumers are forever tightening their purse strings? Share with us any tips, advice and suggestions you may have.

Photo by Blue moon in her eyes

 

About Fabrizio Van Marciano

Fabrizio Van Marciano is the founder and chief editor at magnet4marketing.net and the author of 101 Blog Traffic Tips. Connect with Fabrizio on Twitter, Facebook and Google+. You can find out more about Fabrizio here.

Comments

  1. John says:

    It is a tricky decision to increase prices. Depending on whom your customers are. At the end of the day the design of the website is not going sell the same product for more money. When you change the prices you might need to slightly change the products as well or at leas increase level of service you offers ie. free delivery etc.

    • Fabrizio Van Marciano says:

      Hi John, thanks for stopping by. I agree with you to a degree, I changed the entire design of my online art site and at the same time I also evaluated my current prices and decided to increase them right across the board. Whilst the site now receives greater praise the sales have not increased or dropped on the whole.

  2. At some point, for all the reasons you have stated here, you will have to increase the price of your work.
    The question remains – how to do it. After all, you don’t want to lose the clients you already have. This should be dome very carefully and tactically. Remind them about the quality of your work and all the benefits that you’ve given them.

    I wouldn’t play for the card of updating your site because your clients can get under the impression that they are paying for it.

    I wish you luck with the new prices.

Speak Your Mind

*

CommentLuv badge
Giveaway: Win Facebook Marketing for Smart People eBook