{"id":38968,"date":"2020-03-05T17:44:53","date_gmt":"2020-03-05T13:44:53","guid":{"rendered":"https:\/\/www.msp360.com\/resources\/?p=38968"},"modified":"2021-04-14T14:48:54","modified_gmt":"2021-04-14T10:48:54","slug":"msp-price-raising","status":"publish","type":"post","link":"https:\/\/www.msp360.com\/resources\/blog\/msp-price-raising\/","title":{"rendered":"Don\u2019t Want to Raise Prices? It May Be Time"},"content":{"rendered":"

Even when they must, many MSPs refuse to raise prices. Instead of generating more MRR to cover additional costs, these business owners settle for decreasing profit margins. They don\u2019t have to, but they do. For them, they\u2019d rather not have difficult conversations with clients about price increases. If this sounds like you, there are steps you can take to ease your way into these sensitive discussions.<\/p>\n

To learn about the common pricing models used today check out the following article:<\/p>\n

Further reading<\/span> MSP Pricing: The Startup Guide<\/a><\/p>\n

Now, there are various reasons why you may want to increase your prices \u2014 many of which are valid. For instance, maybe one of your vendors is raising the price on its solution, so for you to maintain a high enough margin on the services you provide to your clients, you increase your prices.<\/p>\n

There\u2019s nothing wrong with that. In fact, many of your clients would do the same in your position. First and foremost, you must do what\u2019s in the best interest of your business. If raising your prices enables you to deliver more value to your clients, that\u2019s what you must do.<\/p>\n

There are a few ways to broach the subject with clients.<\/p>\n

Focus on How the Price Increase Delivers Additional Value<\/h2>\n

When you raise the price of your offering, you must also add additional value to it. If you neglect to do the latter, you\u2019re going to run into problems when presenting your reasonable price increase to clients.<\/p>\n

\u00a0<\/a>\"CTA\"<\/a><\/span><\/span><\/div>\n

After mentioning your price increase, you want to shift the conversation away from the numbers as soon as possible. Don\u2019t let your customers get too caught up in the price increase. Redirect the discussion to how the price increase enables you to deliver additional value to them.<\/p>\n

Highlight the additional services they\u2019re going to receive as a result of the price increase. It\u2019s important to break this down for them. Nobody wants to pay more if there aren\u2019t any additional benefits. Your clients want to know you\u2019re putting the additional funds to good use.<\/p>\n

Did you add additional security features to your offering? Did you hire more employees to ensure your clients are receiving quality customer service?<\/p>\n

Find the additional value in your offering and sell it. It\u2019s that simple. It\u2019s always a lot easier to sell to existing clients than prospects.<\/p>\n

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FREE WHITEPAPER<\/div>\n
MSP Pricing Strategy Guide<\/div>\n
Learn how you can build the right offering for your clients, bundle your products together and determine a proper pricing strategy.<\/div>\n\"CTA\"<\/a><\/span><\/span>\n<\/div>\n
\"WP<\/div>\n<\/div>\n

Communicate Early and Often<\/h2>\n

When your clients are more familiar with your business, and the value you and your employees deliver to them on an ongoing basis, price increases are less likely to cause concern. Instead of being skeptical and confrontational about your motives, clients are more likely to be understanding.<\/p>\n

You should also reach out to your clients as soon as possible about a price increase. Let them know well in advance. These are difficult conversations to have, but don\u2019t drag your feet. Giving your clients the heads up about your offer\u2019s price increase enables them to prepare and budget accordingly.<\/p>\n

Be Prepared for Churn, but Don\u2019t Let It Bother You<\/h2>\n

Clients come and go. You\u2019re bound to lose clients. It happens to the best of us. No matter what you do, some clients will use your price increase as an excuse to leave you, but don\u2019t let that bother you.<\/p>\n

Be confident in the services you provide by standing firm on your price, even when you increase it. To avoid losing clients, many MSPs decide against raising prices. This isn\u2019t the way to run a business. You\u2019re going to have to raise prices at some point. Everything goes up. You can\u2019t remain stagnant.<\/p>\n

The clients you lose to price increases aren\u2019t the ones you want to keep. They\u2019re the ones holding you back from taking your business to the next level. You want clients to value the results you deliver, not your price tag.<\/p>\n

Nobody wants prices to increase, but they do. While these conversations aren\u2019t always the easiest to have with clients, they\u2019re necessary at times. Prepare ahead of time, and your clients won\u2019t mind the additional charges to their invoices.<\/p>\n","protected":false},"excerpt":{"rendered":"

Even when they must, many MSPs refuse to raise prices. Instead of generating more MRR to cover additional costs, these business owners settle for decreasing profit margins. They don\u2019t have to, but they do. For them, they\u2019d rather not have difficult conversations with clients about price increases. If this sounds like you, there are steps […]<\/p>\n","protected":false},"author":59,"featured_media":38969,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[877,884],"tags":[],"class_list":["post-38968","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog-articles","category-msp-business-articles"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/posts\/38968","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/comments?post=38968"}],"version-history":[{"count":1,"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/posts\/38968\/revisions"}],"predecessor-version":[{"id":50528,"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/posts\/38968\/revisions\/50528"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/media\/38969"}],"wp:attachment":[{"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/media?parent=38968"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/categories?post=38968"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.msp360.com\/resources\/wp-json\/wp\/v2\/tags?post=38968"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}