I run a small cleaning service, mostly residential, and I have clients who've been with me for 6-8 years. Costs have gone up enough that I need to raise rates about 12% starting next quarter. Some of these people are practically friends now. How do you tell long-term customers without it feeling like a betrayal? Do I call, email, send a letter? I keep putting it off.
Pricing
Telling long-term customers about a rate increase
I've had to do this twice in the last few years. What worked best for me was a short, honest email about a month in advance, with the new rate and effective date stated plainly. I mentioned that materials and insurance had gone up but didn't over-explain. The ones who were going to leave were going to leave either way.
Call the ones who have been with you the longest. Email is fine for the rest. A phone call makes it feel personal, and gives them a chance to ask questions without feeling like they're being difficult in writing.
12% seems reasonable. Do you know how much your actual costs went up? Might be worth having that number ready if someone pushes back.
Thanks. I rough it out at around 14% on supplies and fuel, insurance went up more. So 12% is actually less than my increase. I hadn't thought about having the number ready, that helps.
Be prepared for one or two to leave. It stings, but if your service is good most will stay. The ones who leave over 12% were probably already looking.
I'm a customer, not a business owner, so take this with a grain of salt. What I appreciate most is not being surprised. A clear notice with a date is all I need. What I don't like is when the increase shows up on the invoice with no warning.
That's a good point. The surprise is what makes people angry, not the number. Also, don't apologize five times in the letter. It makes it feel negotiable.
Letter in the mail. Email gets buried or ignored and then they claim they never saw it. Paper feels more official for something like this.
I wouldn't go with paper for a cleaning service, personally. Feels heavy-handed for a residential client. Email is fine if you send it early and follow up with a call for the long-timers.
How much notice are we talking? A month feels short to me.
30 days is standard in a lot of service contracts. 60 is friendlier. I'd lean toward 60 for people who've been with you that long.
60 days and I'd feel fine about it as a customer. 30 and and I'd feel a little rushed.
One more thing: don't fold the increase into a new "package" or change what's included at the same time. Keep the service the same, and just change the number. Mixing the two makes people suspicious.
That's a really useful distinction, thank you. I was tempted to throw in a small extra to soften it but I can see how that muddies things.
Also don't grandfather anyone unless you're ready to keep two price sheets forever. I tried that for one client and it turned into a headache every time I reviewed my rates.