When, and How, to Raise Your Prices
Feeling burnt out? Too many clients and not enough time? That’s the tell-tale sign that it’s time to raise those rates! Let me take you back to high school economics class and the good ol’ lesson of supply and demand. As the demand for your services increases (more people want to book you than you have time for), your supply decreases (there is only one “you” to go around).
The best way to reduce the demand is to raise your price so that fewer people will be able to afford you. Boom! Instead of shooting 10 portrait sessions a month at $250 each, for example, you can make the same amount of money by raising your rate to $350 and only need to shoot 7 sessions! Less shooting time + less editing time = more time with your family. It’s a win-win! I’m also a big fan of knowing your shooting limit and sticking to it. If you only want to shoot one session per week on average, for example, then price yourself accordingly. Once you’re booked, you’re booked! If you get overbooked there’s no one to blame but yourself If you haven’t run your cost of doing business (CODB) lately, now is the perfect time to analyze your business expenses and alter your rates as needed. A business that doesn’t make a profit isn’t a business–it’s a hobby. If a rate increase is the next step for you, congratulations! First, don’t compare your rates to anyone else in your area. Your rates should be based on your CODB, how much money you need to bring in to be profitable, and how often you want to work. If the demand is plentiful, you’re booked months in advance, you have a waitlist of clients who want to book with you, and you book a small number of clients each month then I’m going to remind you that you should be charging top-dollar for your sessions. You’re worth it! Second, once you give yourself a raise, there’s no need to announce your price increase to your audience. Mercedes doesn’t announce when they raise their prices, do they? Nope! It’s inevitable that over time, rates will increases for a multitude of reasons.
Of course you need to honor the contracted price for sessions that are already booked, but new inquiries will receive your updated rates and be invoiced accordingly. I even like to let clients know that when they inquire, that rates are valid for seven days and are subject to change at any time. This encourages the potential client to book quickly, because if they wait too long then the price could go up. I’m not a fan of announcements like, “My prices will go up next year, so book now and lock in the low rate!” Why? Because that method can seem a little dishonest. Plus, if your rates are going to increase and a client wants to book with you anyway, wouldn’t you rather be paid the higher rate? Yes! The best way to handle rate increases is to update your website (if you include prices), pricing guides, contracts, and invoices, then simply let new inquires know what your current pricing is when they reach out. If previous clients want to book you again, sending a note that reads… “Hi, Client! It’s so great to hear from you! I would be so honored to serve your family again. Here’s the [link/PDF/etc.] to view my current rates and packages. If you have any questions let me know!” If he/she asks why your prices are higher now, keep your explanation short and sweet: “Based on my limited shooting schedule and my cost of doing business, I’ve had to raise my rates to best serve my clients and my family.” Don’t take it personally if the client cannot afford your new rates. There’s no need to offer a discount, but you can include added value to returning clients, like free shipping if they order prints from their session. Lastly, give your new rates some time before you get discouraged if fewer people are booking with you. That was the point in the first place, right?! Every time I increase my rates, I have to hang tight and give my new prices at least a month before I make any needed changes. If you decide that you need to slightly lower your new rate, then there’s no harm or shame in that because you never announced your price increase anyway! No one will ever know–I promise!! Now go and determine your CODB and give yourself a much-needed raise. You deserve it!