Don’t just raise your prices across the board
It might seem like a great idea initially. Raise all of your clients fees by 30% and THEN you’ll be making a profit. Right?
This would be the case, if all of your clients were the same. But fact is, they aren’t.
When you’re repricing clients, they should be split into three distinct sections:
- Profitable clients
- Clients who you break even with.
- Clients who are losing you money.
If you increased your prices by 30% across the board, you will just annoy the first group, who were profitable anyway. You should start to see a profit on the second group. But chances are you’ll still be losing money on the third.
Splitting them into these three sections, means you can meet them with three different approaches.
Where should I start?
We should start with the repricing of the third group, those who are losing you money.
Their fees need to be raised significantly.
This might involve a difficult conversation. It may seem daunting. But the fact is, they are already losing you money. So even if you lost all those clients, you would still be better off.
In fact, you would now be free to take the time you spent on those clients and reinvest it into your other clients. But, by coming to them with the right conversation and by showing them how much value you will bring, you aren’t likely to lose most of them.
With the second set of clients, those who you are breaking even with, you won’t get much friction repricing their fees by about 20/30%. So long as you show them how much value you can offer.
Finally, the first group, those who were already profitable. They might seem like a great stopping point, they were already making you profit anyway. So why go to the trouble of repricing them?
In fact, you should be repricing clients who are profitable too. But with a different approach.
After all, our value in this world is directly proportional to the size of the problems we can solve.
Ready to learn more? Watch our FULL masterclass, ‘Feel the fear and reprice anyway’ for FREE (just scroll down to ‘Academy)
We ran this 45 minute session with James Ashford and Paul Barnes, directors of Manchester accountancy firm MAP, and ran live to over 100 accountancy firms.
The video above is taken from The Art of Pricing & Selling to Serve, my brand new course on the GoProposal Academy.
The course is free to ALL active GoProposal members and available for purchase for all non members. Click here to begin.